Emotional Intelligence As A Mediator Of Sustainable Compensation Perceptions: A Cross-Cultural Study Anchored In Equity Theory For Environmentally Responsible Organizations

Abstract

This study investigates the complex connections among employee results, emotional intelligence (EI), and perceived sustainable remuneration in a range of demographic scenarios. Grounded in Adams' Equity Theory, which posits that perceived fairness significantly influences motivation and satisfaction, the research evaluates how compensation structures impact employee perceptions of equity and performance. Using the Wong and Law Emotional Intelligence Scale (WLEIS), the study dissects four EI dimensions—Self-Emotion Appraisal (SEA), Others’ Emotion Appraisal (OEA), Use of Emotion (UOE), and Regulation of Emotion (REO)—and their mediating roles between sustainable compensation and employee outcomes.

A sample of 152 professionals across South Asian countries and multiple industries was analyzed through correlation, chi-square, and path analysis. Results reveal a strong positive correlation (r = .800) between perceived sustainable compensation and perceived equity. Emotional intelligence significantly mediates this relationship, with OEA and SEA exhibiting the strongest positive effects, while REO shows a notable negative mediation effect. Additionally, all EI dimensions were significantly associated with demographic variables, underscoring the contextual nature of emotional capability development.

Cultural values emerged as the most powerful predictor of sustainable compensation perceptions (R² = .997), with perceived equity contributing marginally yet significantly. These findings suggest that emotional intelligence—particularly empathy and self-awareness—acts as a key conduit through which compensation fairness translates into positive organizational outcomes, reinforcing the relevance of equity theory in modern HR strategy.