Equity in Action: Leveraging Diversity and Leader – Member Dynamics for Organization Justice

Stephen Deepak and Syed Khalid Perwez

International Journal of Finance, Insurance and Risk Management, 2024, vol. 14, issue 3, 3-14

Abstract: Purpose: This study hypothesizes that diversity management positively influences perceptions of organizational justice, while Leader-Member Exchange (LMX) positively impacts both diversity management and organizational justice. Furthermore, it posits that LMX effectively mediates the relationship between diversity management and organizational justice. Design/Methodology/Approach: Drawing from diverse literature on diversity, justice, and LMX, this study underscores the significance of leaders in fostering a climate of diversity management and organizational justice within work units, thereby enhancing organizational effectiveness. Findings: Research indicates that leaders and supervisors play a pivotal role in shaping organizational justice perceptions, particularly concerning distributive and procedural outcomes. Leaders influence these aspects through their opinions, feedback, and involvement in decision-making processes. Moreover, in work units, leaders not only manage diversity but also promote justice through high-quality Leader-Member Exchange (LMX) interactions. Practical Implications: To effectively navigate this diverse workforce and ensure organizational success, it is imperative for organizations to establish a climate of diversity management rooted in clear principles and practices. Central to the notion of organizational success is the concept of organizational justice, wherein any deviation from promised standards, rules, or principles, whether by leaders or the organization itself, is perceived as unfair and unjust. Originality/Value: This study delves into the intersection of diversity management and organizational justice, seeking to understand how the former can foster the latter.

Keywords: Diversity Management; Organization Justice; Leader Member Exchange. (search for similar items in EconPapers)
JEL-codes: D63 J71 M12 M14 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:ers:ijfirm:v:14:y:2024:i:3:p:3-14

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