The Impact of Socially Responsible HRM Practices on Performance with Mediating Role of Intellectual Capital in Pharmaceutical Industry of Pakistan

Abstract

There is a crucial impact of socially responsible human resource management (SRHRM) practices on the behavior of employees and corporate social responsibility (CSR). The impact of SRHRM on the innovation performance (IP) is pivotal and HRM managers hire those talented employees which can bring the innovations with their new ideas, critical thinking, analytical approach etc. for the social responsivity factors. The impact of SRHRM on the organisational performance (OP) is manifold and human resource management (HRM) team hires those staff which has the capability to enhance the organisational overall performance. For this research, the researcher has obtained a sample of 269 managers and employees from different companies operating in the pharmaceutical sector of Pakistan. This study analysed the significance and impact of SRHRM practices on IP and OP in pharmaceutical industry of Pakistan with the mediating role of intellectual capital (IC). Correlation analysis showed that SHRM practices establish a strong and positive association with IP and moderate association with OP and IC. The effect of SRHRM practices on the IP and OP of a company has been found to be positive and significant via regression analysis. Direct and indirect relationship between SRHRM, IC, IP and OP also verified through AMOS analysis. This study determined the mediating role of IC in the relation between SRHRM practices and IP as well as OP. After the entire analysis, it has been concluded that practices of SRHRM are most important for the IP and OP of the pharmaceutical industry of Pakistan.