An Examination of the Impact of Diversity Management and Inclusive Leadership on Retention and Performance in the Banking Sector of Rural Sindh

Abstract

This study empirically investigates the impact of structured diversity management and inclusive leadership on employee retention and team performance in the banking sector of rural Sindh which is highly dominated by tribal culture, lacks women work force (16.3%), and contends with challenges stemming from geographical isolation. Employing quantitative data on 350 employees (in 6 districts i.e. Jacobabad, Kashmore, Shikarpur, Ghotki, Khairpur, Sanghar), regression models became applicable to understand the effects of structured diversity efforts (e.g. fair hiring, ERGs created through a digital platform) on turnover intention (β = 0.756, p < 0.001) and team performance (β = 0.806, p < 0.001), explaining 76% and 65% Complementary yet smaller effects were shown when it came to inclusive leadership (retention: 0.262; performance: 0.193). There was almost a perfect relation between performance and retention (r = 0.876) proving the fact that employee stability is the basis of operational efficiency. Results show that within exclusionary environments, diversity programs are proving to have exponential returns and inclusive leadership is a cultural enricher. Study calls on hyper-localized policy (e.g., Sindhi-language training, gender-norm-sensitive interventions), and digital solution to fill the gaps in implementation. Such limitations are sampling restrictions and cross-sectional design.