Managing diversity at work: Does psychological

safety hold the key to racial differences in

employee performance?
Barjinder Singh1*, Doan E. Winkel2 and T. T. Selvarajan1
1School of Business Administration, University of Houston-Victoria, Texas, USA
2College of Business, Illinois State University, Normal, Illinois, USA

ABSTRACT

Previous diversity research has neglected the role of psychological mechanisms that
underlie the relationship between diversity climate and employee performance. Drawing
on social and racial identity theories, we hypothesized that psychological safety mediates
the relationship between diversity climate and employee performance. Furthermore, we
proposed that race moderates both stages of the mediation, whereby the relationships
between diversity climate and psychological safety and between psychological safety and
performance are stronger for minorities than for Whites. Results, based on a survey of
employees and their colleagues, revealed that the relationship between diversity climate
and employee performance was mediated by psychological safety. We also found that
the diversity climate–psychological safety and psychological safety–extra-role performance
relationships were moderated by race, such that these relationships were
stronger for minorities than for Whites. Further, the indirect effects of diversity climate
on extra-role behaviours via psychological safety were also moderated by race, such that
these relationships were stronger for minorities than for Whites. For efficient
management of diversity in organizations, research and practical implications are also
discussed.

Practitioner Points

_ In the midst of increasing workforce diversity, the study highlights the importance of a
psychologically safe work environment where employees feel confident in expressing
their true selves without fear of being judged as inferior or incompetent.
_ By necessitating the creation of psychologically safe work environments, the study
establishes psychological safety as a principal motivator of employee performance
behaviours in a racially diverse work setting.
*Correspondence should be addressed to Barjinder Singh, School of Business Administration, University of Houston –
Victoria,
14000 University Blvd., Sugar Land, TX 77479, USA (e-mail: singhb9@uhv.edu).
DOI:10.1111/joop.12015
242
_ The study cautions organizational practitioners that when dealingwith racial diversity,
one size does not fit all. Rather, positive organizational contexts (such as diversity
climate and psychological safety) hold a greater significance for minorities and are more
effective in shaping their performance behaviours.
Today’sworkforce is fairly heterogeneous in age, gender, race, and ethnicity (Fullerton &
Toossi, 2001). Current trends suggest that workforce diversity will continue to rise in the
future (Buttner, Lowe, & Billings-Harris, 2009). Although researchers have highlighted
numerous benefits of workplace diversity, such as better problem-solving, creative
decision-making, and enhanced organizational image, diversity management is fraught
with many challenges (Avery & McKay, 2010; Williams & O’Reilly, 1998). Rising
demographic diversity brings greater workplace discrimination, diminishing work
attitudes, and organizational inabilities to retain minority employees (Avery & McKay,
2010). Collectively, these highlight the need for efficient management of diversity at work.
Diversity is not a new construct, but increasing globalization, changing workforce
demographics and societal pressures towards equality and integration have made
diversity management more challenging. Traditional views on diversity management
were restricted to fewer forms and smaller presence of diversity and, consequently, are
ineffective in harnessing the benefits of diversity today (Avery & McKay, 2010; Kaplan,
Wiley, & Maertz, 2011). To effectively manage diversity, diversity climate has become an
emerging area of scholarly research (Gonzalez & DeNisi, 2009; Lauring & Selmer, 2011;
Pugh, Brief, Dietz, & Wiley, 2008). Diversity climate is employees’ perceptions regarding
the extent towhich an organization values and integrates diversity and supports it through
fair employment practices (Kaplan et al., 2011; Mor-Barak, Cherin, & Berkman, 1998).
Diversity climate influences employee behaviours such as turnover intentions and
performance (e.g., Lauring & Selmer, 2012; McKay et al., 2007). While it is important for
organizations to understand individual behaviours influenced by diversity climate, it is
equally important to understand the underlying psychological processes influencing such
behaviours, which has been a major limitation of diversity research (McKay, Avery, &
Morris, 2009). According to Van Knippenberg and Schippers (2007), and Joshi, Liao, and
Roh (2011), direct examination of the diversity climate–work behaviours relationship is
problematic, with inconclusive findings. This calls for the examination of factors that are
more proximal to diversity climate, such as psychological processes. Similarly, Avery and
McKay (2010) suggest that in the examination of the diversity climate–employee outcome
relationship, researchers need to delve into the ‘black box’ of the human mind to identify
the psychological processes that make the above relationship possible. Therefore, to gain
a better understanding of the impact of diversity climate on employee performance, our
study examines the role of psychological safety as an important mediating mechanism.
Psychological safety is perceived freedom in the expression of true self, that is,
whether an individual feels confident in expressing his/her ideas and beliefs without fear
of negative consequences to self-image or career prospects (Chrobot-Mason&Aramovich,
2004). It is the ability to ‘show and employ one’s self ’ without fearing rejection or
punishment by colleagues (Kahn, 1990, p. 708). In general, how people feel in a given
situation influences their behaviour (Kahn, 1990). In a demographically diverse
environment, due to individual differences, employees likely feel more apprehensive in
freely expressing themselves, which further illustrates the importance of psychological
safety in such settings. Therefore, we position psychological safety as an intervening
mechanism in the diversity climate–performance relationship. This is an important
extension of diversity management literature because it invokes the concept of
Managing diversity at work 243
expression of true individual self, which is fundamental to individual identity and is a
necessity in a demographically diverse workplace (Chrobot-Mason & Aramovich, 2004;
Kahn, 1990).
In organizational research, employee performance is an important outcome that
influences organizational effectiveness. Even in social identity literature, in a given
organizational climate, the impact of identification on individual task performance has
been studied, but much of this research is confined to laboratory studies (e.g., James &
Greenberg, 1989; Van Knippenberg, 2001). Social identity researchers argue that
hospitable climates invoke a sense of oneness with workplace, making individuals takeup
activities that benefit their organization, irrespective of whether these activities are
part of their work profile (Van Knippenberg, 2001).
Thus, our focus on employee performance as an outcome of diversity climate is highly
relevant and also supports the business case for diversity (Chrobot-Mason & Aramovich,
2004; McKay et al., 2009). Few studies have examined the diversity climate–employee
performance relationship (e.g., Lauring & Selmer, 2011; McKay, Avery, & Morris, 2008).
We extend previous research by examining in-role and extra-role behaviours as outcomes
of diversity climate. Extra-role behaviours go above and beyond role prescriptions and, by
acting as ‘lubricants’, help in the smooth functioning of the social machinery of the
organization (Bateman & Organ, 1983; Organ, 1997).
In diverse work environments, race influences employees’ organizational experiences,
which may have a differential impact on their attitudes and behaviours (Jeanquart-
Barone, 1996; McKay et al., 2007; Simons, Friedman, Liu, & McLean Parks, 2007).
Although diversity management is important for all employees, minority employees may
react differently to diversity climate and the ensuing psychological safety. Minorities,who
file more complaints of discrimination and hostile working conditions than Whites, are
more likely to have stronger reactions to working conditions related to diversity (McKay
et al., 2007; Simons et al., 2007). Therefore, we investigate the moderating influence of
race on perceptions of psychological safety and subsequent employee performance. We
extend diversity research (e.g., McKay et al., 2007) by highlighting racial differences not
just in employee performance but also with respect to individual psychological reactions
to firm’s diversity climate.
Using a matched-pair sample of 165 employees and co-workers from a manufacturing
organization in the Midwestern United States, our study contributes to diversity
management literature in two ways. First, by highlighting the role of individual identity
expression as a mediator of diversity climate–performance relationship, our study
broadens the theoretical lens used in examination of the impact of diversity on workrelated
outcomes. Freedom to express one’s true self is important for most individuals
(Edmondson, 1999; Kahn, 1990). Within the realm of social identity literature, the ability
to act in concert with one’s self-concept has been regarded as fundamental to individual
identification (Ashforth, Harrison, & Corley, 2008). Therefore, in the modelling of
employee performance in a racially diverse work setting, our study positions
psychological safety as an important underlying phenomenon and informs diversity
scholars of the importance that individuals attribute to the protection and expression of
their true self.
Our second contribution is the attention to the role played by race in differentially
impacting diversity climate–psychological safety and psychological safety–performance
relationships. In their quest to promote employee performance, especially minority
performance, organizations often feel stymied (Foley, Kidder, & Powell, 2002). By
providing a glimpse into the psyche of employees, our study offers new insights to
244 Barjinder Singh et al.
organizational practitioners by reiterating that in a racially diverse work environment,
‘one size does not fit all’.
Theoretical framework and hypotheses
The theoretical model for this research is presented in Figure 1. We propose that
employees’ appraisal of organizational diversity climate influences their psychological
safety, which in turn shapes their performance, and these relationships are moderated by
individual race.
Our proposed model is based on social identity theory (SIT; Ashforth & Mael, 1989;
Stryker, 1968; Tajfel & Turner, 1986), which states that individuals classify themselves
into social groups based on certain salient characteristics (e.g., race, age, gender) to
pursue positive self-concept. Self-concept, which is an individual’s perception of self, is
derived from that individual’s knowledge about his/her membership in a social group and
the importance ascribed to that membership (Tajfel, 1978). Thus, identification with a
social group helps strengthen and reaffirm individual self-concept and ensures the
expression of that self-concept in concert with the salient individual identity (Ellemers,
1993; McKay et al., 2007).
Ashforth et al. (2008) assert that identification is the process by which people define
themselves and communicate that definition to others without any fear or inhibitions,
which is akin to our definition of psychological safety. Expression of an individual’s true
self without any fear is fundamental to the process of identification and fulfils a basic
human need (Ashforth et al., 2008). Supportive organizational contexts (e.g., supportive
diversity climate) positively influence the formation and expression of true individual
identity at work (Ashforth & Mael, 1989; Carmeli, Brueller, & Dutton, 2009). On the
contrary, unsupportive organizational climates pose a threat to individual identity, curtail
individual confidence, and jeopardize individual self-expression (Foley et al., 2002;
McKay et al., 2007).
In addition, symbolic interactions are critical to the development of social identification
(Ashforth & Mael, 1989). On the basis of symbolic interactions, individuals are able
to make sense of situations and get a true understanding of their identity (Ashforth, 1985;
Stryker, 1980). Based on symbolic interactions, individuals are able to resolve ambiguity
and ‘impose an informational framework or schema on organizational experience’ and
by doing so, gain awareness about the status they enjoy within their social group
Diversity climate
Employee performance
OCBO
OCBI
In-role behaviours
Race
Psychological
safety
Figure 1. Theoretical framework of employee performance.
Note. OCBO, organizational citizenship behaviours-organizational; OCBI, organizational citizenship
behaviours-interpersonal.
Managing diversity at work 245
(Ashforth & Mael, 1989, p. 27). For a certain category of individuals, based on their racial
affiliations, these social interactions and ambient climates hold greater significance.
Although management researchers claim that supportive work climates are equally
significant for all employees, SIT asserts that supportive climates and positive social
interactions hold a greater significance for racial minorities (McKay et al., 2007; Singh &
Winkel, 2012). Racial minorities report more incidents of racial discrimination and
identify more with their race than Whites (Clark, Anderson, Clark, & Williams, 1999).
Consequently, in the expression of their identities and enactment of their work
behaviours, racial minorities react more strongly to organizational contexts (McKay et al.,
2007).
From diversity climate to psychological safety
In determining antecedents of psychological safety, researchers have focused on
supportive climates (Dollard & Bakker, 2010; Edmondson, 1999). In a hostile diversity
climate where minorities are degraded, even Whites find it hard to feel comfortable
(Buttner et al., 2009). In organizations where diversity is not valued, employees fear
negative evaluations, which undermine employees’ confidence and force them to limit
their behaviours and restrict self-expression (Foley et al., 2002; Ilgen & Youtz, 1986).
Such a climate can also make employees suspicious of being watched and judged by
superiors, which enhances doubts about employers’ intentions (Federal Glass Ceiling
Commission Report, 1995).
On the contrary, organizational appreciation for diversity conveys a positive message
to all employees, which encourages self-expression and interpersonal risk-taking
(Edmondson, 1999; Kahn, 1990). Organizational contexts replete with positive social
interactions encourage interpersonal liking, promote proximity, minimize threat, and
facilitate individual categorization into social groups, paving the way for formation and
expression of individual identities (Ashforth & Mael, 1989; Ashforth et al., 2008).
Similarly, we propose that efficient management of diversity makes employees comfortable
in expressing their self-concept. A supportive diversity climate is thus an essential
organizational context that inspires psychological safety among employees.
Empirical research shows that positive organizational climates are instrumental in
shaping employees’ organizational identification (Singh & Winkel, 2012). Additionally, a
supportive diversity climate elicits positive employee reactions towards their workplace,
such as satisfaction and feelings of oneness with the organization (Lauring&Selmer, 2011;
McKay et al., 2007). Research also shows that contexts favouring employee inclusiveness
contribute significantly to psychological safety (Nembhard & Edmondson, 2006).
Therefore, efficient management of diversity at work influences individual psychological
reactions, whereby employees feel safe in expressing their salient identities.
Hypothesis 1: A supportive diversity climate is positively associated with employees’
psychological safety.
From perceived psychological safety to employee performance
Appraisal of situational factors forms the basis of individual action (Deci & Ryan, 2008;
Walumbwa, Wang, Wang, Schaubroeck, & Avolio, 2010). In a psychologically safe work
environment, employees feel comfortable in freely expressing their concerns and doubts,
which in turn influences individual actions (Edmondson, 1999; Hirak, Peng, Carmeli, &
246 Barjinder Singh et al.
Schaubroeck, 2012). Psychological safety is also a catalyst behind the organizational
change process as it inspires employee confidence in decision-making, which in turn puts
the organization on a better course of action (Schein&Bennis, 1965). Psychological safety
has been reported to influence a host of individual outcomes, such as employee
engagement, creativity, commitment, and learning behaviours (Carmeli et al., 2009; Kark
& Carmeli, 2009; May, Gilson, & Harter, 2004).
Although psychological safety has been linked to various outcomes, the relationship
between psychological safety and employee performance has been scarcely examined
(e.g., Brown & Leigh, 1996). Previous research suggests that employee performance is
multi-dimensional and consists of in-role and extra-role behaviours (Williams &Anderson,
1991). In-role behaviours (IRBs) relate to employee actions that have a direct bearing on
their task performance as specified in their formal job description. Extra-role behaviours,
or organizational citizenship behaviours (OCBs), are behaviours that are not part of an
employee’s job description but promote organizational effectiveness and are categorized
as helping behaviours towards the organization (OCBO) and other individuals (OCBI;
Williams & Anderson, 1991).
We propose that psychological safety will be related to IRBs and extra-role behaviours.
In an environment characterized by low levels of psychological safety, employees are
afraid to speak honestly and may feel reluctant to engage in task-related behaviours, such
as asking for resources for completing a task, asking questions, seeking feedback, and
reporting a problem or a mistake (Kark & Carmeli, 2009). Moreover, the fear and
uncertainty that may be present in psychologically unsafe environments may distract
employees from focusing on their tasks.
If employees perceive that their organizational environment is psychologically safe,
they may reciprocate by engaging in citizenship behaviours directed at the organization
(OCBO). Although organizations may set policies, employees set the tone for a
psychologically safe work environment with their day-to-day interactions. Therefore,
upon feeling psychologically safe, employees are more likely to help their co-workers (i.e.,
OCBI). Thus, we expect that psychological safety will engender positive feelings towards
tasks, the organization, and co-workers.
Hypothesis 2: Psychological safety is positively associated with (1) OCBO, (2) OCBI,
and (3) IRBs.
Psychological safety as a mediator
A central tenet of SIT is that identification mediates the relationship between social
experiences and individual behaviours (Ashforth et al., 2008; Singh & Winkel, 2012). An
individual’s evaluation of organizational climate facilitates individual categorization into
social groups, which affirms social identity and facilitates identity expression and,
consequently, paves the way for individual behaviours (Singh & Winkel, 2012). Research
shows positive workplace conditions do not directly translate into individual performance
unless the individual feels comfortable in such environments (Luthans, Norman,
Avolio, & Avey, 2008). We propose that psychological safety mediates the relationship
between an individual’s assessment of diversity climate and performance behaviours.
Supportive work climates enhance self-confidence and make it easy for individuals to
discharge any insecurities and anxieties they might have, which enables them to
undertake behaviours that benefit the organization (Edmondson, 1999; Kahn, 2001;
Nembhard & Edmondson, 2006). Previous research supports the mediating role of
Managing diversity at work 247
psychological safety in the supportive work environment–employee outcome relationship.
For example, psychological safety has been reported to mediate the relationship
between leader inclusiveness and employee engagement (Nembhard & Edmondson,
2006). May et al. (2004) verified psychological safety as a mediator between co-worker
norms and employee engagement. Edmondson (1999) found psychological safety
mediated supportive leadership and team learning behaviours. We expect psychological
safety to mediate the relationship between diversity climate and performance outcomes.
Hypothesis 3: Psychological safety mediates the relationship between a firm’s diversity
climate and (1) OCBO, (2) OCBI, and (3) IRBs.
The moderating role of race
In addition to explaining the antecedents and outcomes of formation and expression of
individual identity, SIT highlights the importance of individual differences that, in a given
organizational climate, engender differential impact on individuals’ identity expression
and subsequent behaviours. As articulated above, salient characteristics, such as race and
gender, are the basis of individual categorization into social groups (Tajfel & Turner,
1986). The choice of a social group is driven by how individuals define their identities
(Stets & Burke, 2000), and consequently, they seek memberships in social groups that
coalesce their identity with that of the group. It is not only the identification with a social
group that matters but also the expression of salient identity, and together, they shape
groupmembers’ perceptions about their group and promote behaviours that favour group
interests (Hogg & Terry, 2000; Singh & Winkel, 2012). Although positive work climates in
general influence the identification and behaviours of all employees, they hold an even
greater significance for racial minorities (McKay et al., 2007; Singh & Winkel, 2012).
Racial minorities report greater discriminatory incidents at work (Bell, Harrison, &
McLaughlin, 1997; Utsey, Chae, Brown, & Kelly, 2002), and due to negative stereotypes
and acts of racial discrimination, they often succumb to a subordinate status at work
(Feagin, 1991; Heilman, Block, & Lucas, 1992). Living with the disappointment that their
identities are not consistent with the requirements of their workplace, racial minorities
find it hard to express their true self and, consequently, limit their work behaviours (Foley
et al., 2002). Research has shownthat minority employees find pro-diversity work climate
as more affirming of their social identity, which makes them feel psychologically safe and
motivates them to contribute towards organizational objectives by way of better in-role
and extra-role performance behaviours (McKay et al., 2008). According to Ely and
Thomas (2001), in a supportive diversity climate, minority employees feel valued and
appreciated and, consequently, show more commitment towards the achievement of
organizational goals and are willing to go above and beyond their role prescriptions. On
the contrary, poor racial conditions have a double-negative impact on minorities: first,
they undermine minority perceptions regarding their workplace, and second, they induce
poor minority behavioural response (McKay et al., 2007; Singh & Winkel, 2012).
Racial identity theory (RIT) further provides a fine-grained analysis of the importance
racial minorities place on positive organizational contexts (McKay et al., 2007; Phinney,
1992). According to RIT, racial minorities tend to identify more with their race than
Whites and react more strongly to discrimination and prejudice at work (Merritt, Ryan,
Mack, Leeds, & Schmitt, 2010). Minority employees may feel more psychologically unsafe
in reaction to a diversity climate where they are not included and valued by the
organization. Further, when minority employees feel more unsafe in expressing
248 Barjinder Singh et al.
themselves (compared with Whites), it may more strongly inhibit their in-role
performance and prohibit themfrom going an extra step for the sake of their organization.
Therefore, if organizations can create a supportive diversity climate, racial minorities are
more likely to respond with greater perceived psychological safety and performance
behaviours. Conversely, for Whites, a positive diversity climate and psychological safety
hold less value than for racial minorities (Merritt et al., 2010).
Diversity researchers have shown that respectful climates are more important for
individuals who occupy peripheral status within organization, and consequently, they are
more likely to respond with behaviours that favour their organization (De Cremer, 2002;
Tyler & Lind, 1992). McKay et al. (2007) found that diversity climate is more salient for
racial minorities in curbing their tendencies to turnover. Singh and Winkel (2012)
reported that in the determination of organizational identification and subsequent helping
behaviours, racial minorities responded more positively to workplace relational climate
than their Caucasian counterparts. Minority–majority racial differences have also been
reported with respect to employee absenteeism (a performance criterion), whereby in
pro-diversity organizations, these differences have been reported to be smaller (McKay
et al. 2007). Therefore:
Hypothesis 4: The positive relationship between a supportive diversity climate and
psychological safety is moderated by employees’ race, such that this
relationship is stronger for racial minorities than for Whites.
Hypothesis 5: The positive relationships between psychological safety and (1) OCBO,
(2) OCBI, and (3) IRBs will be moderated by employees’ race, such that
these relationships are stronger for racial minorities than for Whites.
We further propose that race will moderate the mediating effect of psychological
safety on the relationship between diversity climate and performance outcomes. Building
on social and racial identity theories, we expect the mediating effect of psychological
safety will be more salient for racial minorities than Whites.
Hypothesis 6: The mediating influence of psychological safety on the relationship
between diversity climate and (1) OCBO, (2) OCBI, and (3) IRBs will be
moderated by race, such that the mediating effect will be stronger for
racial minorities than for Whites.
Method
Data collection and survey administration
Respondents were employees and supervisors of a Midwestern US mid-size production
organization. Employees provided contact information of a supervisor or co-worker who
was familiar with their work roles. Individualized emails with survey links were sent to
employees’ colleagues to collect information about employees’ performance. We
received 81 responses from supervisors and 84 from co-workers. Between the supervisory
and co-worker groups, we computed the difference in means for all three performance
variables, which were found to be non-significant. Therefore, we combined supervisory
and co-worker ratings to generate peer-evaluated performance ratings. Of the 500
employees, 165 matched-pair responses were returned, providing an overall response
rate of 33%.
Managing diversity at work 249
Sample characteristics
Employee racial composition was 100 Whites (61%), 48 Hispanics (29%), and the
remaining 17 belonged to other racial minority categories (Blacks [7], Asian [4], multiracial
[2], and other minorities [4]). The focal employees’ average age was 41 years, 72%
were men, and 66% were married. The average organizational tenure for the focal
employees was 8.6 years. Supervisors/co-workers were, on average, 42 years of age and
had known the focal employee for an average of 6.6 years. The average organizational
tenure for supervisors/co-workers was 8.5 years.
Measures
All measures were taken from previously validated studies and used a 5-point Likert scale
(1 = ‘Strongly Disagree’ and 5 = ‘Strongly Agree’).
Diversity climate was measured using McKay et al.’s (2008) 4-item scale. Sample
items were ‘I trust this organization to treat me fairly’ and ‘This organization maintains a
diversity friendly work environment’.
Employees’ psychological safety was measured using 3-item scale by Chrobot-Mason
and Aramovich (2004). Items were ‘I feel that I can fit-in at work without having to change
who I am’ and ‘When at work, I feel free to express my ideas even if they differ from others
within the company’.
Race was self-reported. Extant research on race and racial differences has reported that
reactions of different racial minority groups tend to be fairly similar to organizational
practices (e.g., Singh & Winkel, 2012). Therefore, we combined all racial minorities into
one category. Race was coded as Whites = 0 and racial minorities = 1.
Employee performance was measured by asking supervisors and co-workers to rate
the focal employee on OCBs and IRBs.
We used the scale developed by Williams and Anderson (1991) to measure OCBOrganizational
(OCBO) and OCB-Interpersonal (OCBI), with both having seven items
each. A sample OCBO item is ‘Gives advance notice when unable to come to work’. A
sample OCBI item is ‘Helps others who were absent’.
To measure IRBs, we used the 5-item Williams and Anderson’s (1991) scale. Sample
items were ‘Adequately completes assigned duties’ and ‘Fulfills responsibilities specified
in job description’.
Control variables
Researchers suggest that demographic variables, such as gender, age, and organizational
tenure, influence employee performance (Sekiguchi, Burton, & Sablynski, 2008;
Walumbwa & Hartnell, 2011) and supervisory ratings of employee performance and
OCBs (Sekiguchi et al., 2008).We therefore controlled for these variables in our analyses.
Gender was coded as male = 0 and female = 1. Age was measured in years, and
organizational tenure was measured in months.
Results
Table 1 presents means, standard deviations, correlations, and coefficient alphas for study
variables. Alphas for all the measures were satisfactory (>.70; Tabachnick & Fidell, 2007).
To establish the construct validity of psychological safety and diversity climate, we
conducted a confirmatory factor analysis and found a two-factor model fitted data better
250 Barjinder Singh et al.
[v2 = 66.73 (df = 13), CFI = 0.95 NFI = 0.93, and SRMR = 0.06] than a one-factor model
[v2 = 220.51 (df = 14), CFI = 0.75, NFI = 0.74 and SRMR = 0.14].
To test the hypotheses,weran the basic mediational model and amoderated mediation
model using procedures described by Preacher and colleagues (Preacher & Hayes, 2004;
Preacher, Rucker, & Hayes, 2007). As suggested (Preacher et al., 2007),we regressed the
mediator on the independent variable and controls and then regressed the dependent
variables on the independent variable, mediator, and controls. Table 2 presents these
results.
To test for the significance of the mediational effects, Preacher et al. (2007) prescribed
a non-parametric bootstrapping procedure. Table 3 presents these results.
As suggested by Preacher et al. (2007), analysis of the moderated mediation model also
had two steps. First, we regressed the mediator on the controls, independent variable,
moderator, and the interaction between the independent variable and moderator.
Second, we regressed the dependent variables on the controls, independent variable,
moderator, mediator, and interaction between mediator and moderator. These two steps
correspond to the first and second stage of the moderated mediational model described by
Edwards and Lambert (2007). Table 4 presents the results. The conditional indirect
effects at the two levels of the moderator based on bootstrapping procedure are presented
in Table 5. As outlined by Edwards and Lambert (2007), we used the bootstrapping
procedure with bias-corrected confidence interval for calculating the significance of the
difference in indirect effects, and these results are presented in Table 5.
As evident from Table 2, Hypothesis 1, which proposed a positive relationship
between diversity climate and psychological safety, was supported (B = 0.86, t = 9.24,
p < .01). The effect size for this relationship was 0.47. Hypothesis 2 predicted a positive
psychological safety–employee performance relationship. As shown in Table 2, psychological
safety was significantly associated with OCBO (B = 0.17, t = 3.16, p < .01), OCBI
(B = 0.20, t = 3.15, p < .01), and IRBs (B = 0.12, t = 1.89, p < .10), thus supporting
Hypotheses 2a, 2b, and 2c. The corresponding effect sizes for these relationships are
0.17, 0.09, and 0.06, respectively.
Hypothesis 3 predicted the mediating influence of psychological safety on the
relationship between diversity climate and performance variables. Results (see Table 3)
suggest that the indirect effects of diversity climate on OCBO and OCBI are significant
(effect sizes being 0.15 and 0.17, respectively) at 95% confidence interval as the
confidence intervals for these variables [0.06, 0.23 and 0.08, 0.29, respectively] do not
include zero, thus supporting Hypotheses 3a and 3b. The indirect effect for IRB was
significant at 90% confidence interval [0.008, 0.21; effect size = 0.11], thus supporting
Hypothesis 3c.
Hypothesis 4 proposed race-moderated diversity climate–psychological safety
relationship. Results suggest that the interaction term between race and diversity climate
is significant (see Table 4; B = 0.83, SE = 0.14, p < .01; effect size = 0.14). Slopes for
both race conditions, Whites (B = 0.54, t = 5.88, p < .01) and minorities (B = 1.65,
t = 11.41, p < .01), were also significant. Following Aiken and West’s (1991) recommendations,
we plotted the interaction in Figure 2, which shows that the relationship
between diversity climate and psychological safety is stronger for minorities (than
Whites), supporting Hypothesis 4a.
Hypothesis 5 stated race-moderated relationship between psychological safety and
performance outcomes. Results in Table 4 indicate that the interaction between
psychological safety and race was significant for OCBI (B = 0.28, SE = 0.10, p < .01;
effect size = 0.07), but not for OCBO (B = 0.01, SE = 0.09, p > .05) or IRB (B = _0.14,
Managing diversity at work 251
Table 1. Means, standard deviations, correlations, and scale reliabilities
Variables 1 2 3 4 5 6 7 8 9
1. Gender – – – – – – – – –
2. Age _.10 – – – – – – – –
3. Tenure _.28** .64** – – – – – – –
4. Race _.23** _.14 .11 – – – – – –
5. Diversity
climate
_.21** .29** .32** .24** (.86) – – – –
6. Psychological
safety
_.09 .19** .27** .08 .60** (.92) – – –
7. OCBO .03 .16* .17* .06 .21** .33** (.80) – –
8. OCBI .04 .20** .23** .02 .40** .44** .58** (.87) –
9. IRB .03 .05 .18* .34** .25** .29** .63** .50** (.93)
N 163 163 165 165 165 165 165 165 165
M 0.28 42 102.56 0.39 4.10 4.04 4.31 4.03 4.45
SD 0.45 12.41 104.18 0.49 0.74 1.00 0.56 0.71 0.69
Note. Race (0 = Whites, 1 = minorities), gender (0 = males, 1 = females). OCBO, organizational citizenship behaviours-
organizational; OCBI, organizational
citizenship behaviours-interpersonal; IRB, in-role behaviours. *p < .05; **p < .01.
252 Barjinder Singh et al.
Table 2. Results of basic mediation model
Variables
Model 1: DV = Psychological
safety
Model 2: DV = performance outcomes
OCBO OCBI IRB
B SE t B SE t B SE t B SE t
Age _0.01 0.01 _0.95 0.00 0.01 0.75 0.00 0.01 0.14 _0.01 0.01 _1.63
Gender 0.18 0.15 1.25 0.08 0.09 0.80 0.23 0.12 1.99* 0.17 0.12 1.40
Organisational tenure 0.00 0.00 1.70 0.00 0.00 0.53 0.00 0.00 1.25 0.00 0.00 2.107*
Diversity climate 0.86 0.09 9.24** _0.01 0.08 _0.19 0.21 0.09 2.34* 0.12 0.09 1.25
Psychological safety – – – 0.17 0.05 3.16** 0.20 0.06 3.15** 0.12 0.07 1.89†
Model R2 0.39** 0.12** 0.24** 0.11**
Note. Race (0 = Whites, 1 = minorities), gender (0 = males, 1 = females). OCBO, organizational citizenship behaviours-
organizational; OCBI, organizational
citizenship behaviours-interpersonal; IRB, in-role behaviours. *p < .05; **p < .01; †p < .10.
Managing diversity at work 253
SE = 0.09, p > .05). Thus, Hypothesis 5b was supported, but not Hypotheses 5a and 5c.
For the significant interaction, the slopes for Whites (B = 0.036, t = 0.43, p > .05) and
minorities (B = 0.31, t = 4.16, p < .01) were also calculated. To better understand the
significant interaction, we plotted it in Figure 3, which indicates that the relationship
between psychological safety and OCBI was stronger for minorities than Whites.
Hypothesis 6 proposed race-moderated indirect effect of diversity climate on
performance outcomes via psychological safety. Using the procedures outlined by
Preacher and Hayes (2004),we tested the moderated mediation model. Further, based on
the procedures suggested by Edwards and Lambert (2007), we calculated the biascorrected
confidence interval using the bootstrapping procedure for the difference in
indirect effect at the two levels of race. As presented in Table 5, the results for OCBO as
the criterion indicate that the difference in indirect effect (of the magnitude 0.15) at 95%
confidence interval for Whites and minorities excluded zero [0.03, 0.26]. Thus,
supporting Hypothesis 6a, the indirect effect of diversity climate on OCBO through
psychological safety was stronger for minorities than Whites, and this difference is shown
in Figure 4.
Results (see Table 5) suggest that for OCBI as the outcome variable, at 95% confidence
interval, the difference in indirect effect (of the magnitude 0.38) between Whites and
minorities excluded zero [0.20, 0.40], which indicates that the indirect effect of diversity
climate on OCBI via psychological safety was stronger for minorities than Whites (see
Figure 5). This supports Hypothesis 6b.
The difference in indirect effect of diversity climate (of the magnitude 0.02) on IRBs
through psychological safety for the two racial categories was not significant, as the
confidence interval [_0.14, 0.11] included zero, therefore not supporting Hypothesis 6c.
Discussion
We investigated individual reactions to a firm’s diversity climate, how these reactions
shape individual performance, and how race influences these relationships. Using social
and racial identity theories,wefound that in a supportive diversity climate, employees feel
psychologically safe expressing their identities, which influences their in-role and extrarole
performance. This underscores the importance of psychological safety as a critical
mechanism in the enactment of individual performance behaviours. Our study also found
that, in a given diversity climate, an individual’s race influences how they choose to
behave. Particularly, we found that diversity climate–psychological safety and psychological
safety–OCBI relationships were stronger for racial minorities than Whites.We also
found that the indirect effects of diversity climate on OCBO and OCBI, via psychological
safety, were stronger for racial minorities than Whites.
Table 3. Bootstrapping results for the basic mediation model
Outcome variable Indirect effect Boot SE Boot LLCI Boot ULCI
OCBO 0.15 0.04 0.06 0.23
OCBI 0.17 0.05 0.08 0.29
IRB 0.11 0.05 0.008 0.21
Note. Indirect effect for IRB based on 90% confidence interval; indirect effect forOCBO and OCBI based
on 95% confidence interval; OCBO, organizational citizenship behaviours-organizational; OCBI,
organizational citizenship behaviours-interpersonal; IRB, in-role behaviours.
254 Barjinder Singh et al.
Table 4. Results of moderated mediation model
Variables
Model 1: DV = psychological
safety
Model 2: DV = outcomes
OCBO OCBI IRB
B SE t B SE t B SE t B SE t
Age _0.16 0.08 _2.03* 0.05 0.06 0.96 0.00 0.06 _0.02 _0.02 0.06 _0.35
Gender 0.03 0.06 0.33 0.05 0.05 0.87 0.08 0.05 1.32 0.12 0.05 2.39*
Organisational tenure 0.11 0.08 1.45 0.02 0.06 0.36 0.08 0.06 1.17 0.10 0.06 1.45
DC 0.42 0.08 5.88** _0.03 0.05 _0.36 0.16 0.06 2.45* 0.01 0.06 0.26
PS 0.17 0.07 2.3* 0.04 0.08 0.43 0.23 0.08 2.70**
Race _0.33 0.12 _2.63** 0.07 0.09 0.82 _0.07 0.10 _0.64 0.48 0.10 4.51**
DC 9 Race 0.83 0.14 6.3** – – – – – – – – –
PS 9 Race – – – 0.01 0.09 0.06 0.28 0.10 2.76** _0.14 0.09 _1.40
Model R2 .53** .12** .28** .23**
Note. Race (0 = Whites, 1 = minorities), gender (0 = males, 1 = females). OCBO, organizational citizenship behaviours-
organizational; OCBI, organizational
citizenship behaviours-interpersonal; IRB, in-role behaviours; DC, diversity climate; PS, psychological safety. *p < .05; **p
< .01.
Managing diversity at work 255
A few hypotheses were not supported, particularly race-moderated effect of
psychological safety on OCBO and IRBs and race-moderated indirect effect of diversity
climate on IRBs, via psychological safety. One explanation could be the kind of outlook
minority employees develop while working in a given organization. Due to their
peripheral status, most minority employees feel insecure at work and the burden of
working in a psychologically unsafe environment can enhance their insecurities. Even in
the absence of psychological safety, out of the fear of losing their jobs, minority employees
might struggle to compromise in-role and extra-role behaviours directed towards their
organization. Future research should examine the conditions under which psychological
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
Low High
Psychological safety
Diversity climate
White
Minorities
Figure 2. Moderating effect of employee race on diversity climate and psychological safety relationship.
Table 5. Bootstrapping effects for the moderated mediation model with psychological safety as the
mediator
Variable Indirect effect Boot SE Boot LLCI Boot ULCI
Outcome: OCBO
Moderator level: White 0.07 0.03 0.01 0.14
Moderator level: minorities 0.22 0.07 0.09 0.36
Difference 0.15 0.005 0.03 0.26
Outcome: OCBI
Moderator level: White 0.01 0.03 _0.04 0.06
Moderator level: minorities 0.39 0.09 0.22 0.58
Difference 0.38 0.008 0.2 0.4
Outcome: IRB
Moderator level: White 0.09 0.03 0.02 0.18
Moderator level: minorities 0.11 0.09 _0.06 0.27
Difference 0.02 0.008 _0.14 0.11
Note. OCBO, organizational citizenship behaviours-organizational; OCBI, organizational citizenship
behaviours-interpersonal; IRB, in-role behaviours.
256 Barjinder Singh et al.
mechanisms relate to IRBs and OCBO. With newer insights into efficient diversity
management, our study should stimulate future research and practice in making ‘diversity
at work’ work.
3
3.2
3.4
3.6
3.8
4
4.2
4.4
4.6
4.8
5
Low High
OCBI
Psychological safety
White
Minorities
Figure 3. Moderating effect of employee race on perceived psychological safety and employee
organizational citizenship behaviours-interpersonal (OCBI) relationship.
3.8
3.9
4
4.1
4.2
4.3
4.4
4.5
4.6
Low High
OCBO Diversity climate
White
Minorities
Figure 4. Moderating effect of employee race on the indirect effect of diversity climate-organizational
citizenship behaviours-organizational (OCBO) relationship via psychological safety.
Managing diversity at work 257
Theoretical contributions
Our results from our premise that psychological safety mediates the diversity climate–-
employee performance relationship have important implications for organizational
literature. Although the relationship between diversity and performance has been
previously studied (e.g., Lauring&Selmer, 2011), few studies have investigated the role of
psychological reactions to a firm’s diversity climate in shaping employee performance.
Diversity scholars contend that the relationship between diversity and employee
performance is inconclusive and the mechanisms linking the two need to be clarified
(e.g., Avery & McKay, 2010). Our study contributes to this literature by illustrating
psychological safety as a mechanism throughwhich the effect of diversity climate impacts
employee performance. Our study also contributes to social identity literature as it is
through the assurance of psychological safety that individuals are able to maintain and
express their true identity and subsequent individual behaviours are made possible.
Our second contribution is examining race in differentially influencing perceptions of
psychological safety and employee performance. Our findings support extant research
and re-establish the importance of diversity climate for all employees (e.g., Hicks-Clarke&
Iles, 2000; McKay et al., 2007). They also highlight the role of race in shaping individual
psychological reactions to firms’ diversity climate. Extant research shows thatmembers of
majority and minority racial groups behave differently to a firm’s diversity climate, and
these differential effects are evident in employees’ behaviours and in their psychological
reactions to diversity climate. Building on SIT and RIT, our study reiterates that in a racially
diverse work environment, ‘one size does not fit all’.
Another contribution is the examination of in-role and extra-role performance
outcomes of diversity climate. Research on diversity climate and performance is sparse
and has been limited to the examination of in-role performance outcomes. Our study
extends diversity literature by expanding the criterion domain to include extra-role
performance outcomes. Employee performance is a multi-dimensional construct, so
including both outcomes is an important theoretical contribution as they provide a
3
3.2
3.4
3.6
3.8
4
4.2
4.4
4.6
4.8
5
Low High
OCBI
Diversity climate
White
Minorities
Figure 5. Moderating effect of employee race on indirect effect of diversity climate-organizational
citizenship behaviours-interpersonal (OCBI) relationship via psychological safety.
258 Barjinder Singh et al.
relatively complete account of employee performance in a given diversity climate.
Further, instead of using self-reported ratings for employee performance, our study uses
peer-reported ratings, which minimizes the probability of common method bias.
Additionally, our focus on diversity climate as a key predictor, as opposed to demographic
heterogeneity, is consistent with the value-in diversity paradigm articulated by diversity
scholars, whereby, to fully reap the benefits of diversity, individual differences need to be
valued and integrated (e.g., Ely & Thomas, 2001).

Practical implications Our findings have practical implications for managers.Wefound the relationship between
diversity climate, psychological safety, and performance is important for all employees
regardless of race. Managers can therefore foster psychological safety by creating a
hospitable climate for diversity. Organizations can ensure supportive diversity climate by
increasing minority representation at different levels within the organization, by
supporting diversity-related initiatives, by hiring from diverse sources, and by instituting
training and development programmes aimed at diversity management.
We also found that psychological safety is an important mechanism linking diversity
climate and employee performance. The creation of a supportive diversity climate
becomes an even greater necessity for organizations. Recent studies on psychological
safety have shown that psychological safety is a function of interpersonal factors like highquality
relationships and leadership behaviours. According to our findings, organizational
climates may also help mitigate individual fears associated with identity expression,
paving the way for individual performance. Thus, organizations need to proactively
eradicate racial intolerance and create a climate that supports diversity.
We also found that effects of diversity climate and safety are stronger for minorities.
Therefore, organizations need to be more sensitive to the needs and apprehensions of
minority employees. To make ‘diversity at work’ work, organizations cannot be
astigmatic in their approach, but need to be sensitive towards expectations of minority
employees who are more likely to respond positively towards organizational efforts
aimed at efficient diversity management. Organizational inability to manage diversitywell
can adversely affect minority psychological safety and significantly lower their performance
behaviours.

Limitations and future research Our study has limitations that must be noted. First, our research is cross-sectional, and we
cannot be sure whether the relationships would hold in long term. This is an avenue that
organizational researchers should pursue through longitudinal studies. Also, experimental
research designs could help establish causal linkages (Spencer, Zanna, & Fong, 2005).
The second limitation of our study is our research setting. We collected data from a
single manufacturing organization. To increase generalizability, future researchers should
collect data from populations in different industries and locations.
Another limitation is that in the modelling of employee performance, we only
examined the role of diversity climate from the standpoint of race and ethnicity. Within
diversity literature, there are other forms of deep-level diversity, such as diversity in
religious beliefs and diversity in sexual orientation, which we did not address. Therefore,
it will be interesting to know how organizational stand on other types of diversity would
Managing diversity at work 259
impact individual psychological processes and subsequent work behaviours. This is
something future researchers may wish to consider.
Research on diversity has shown that reactions of different racial minority groups to
organizational practices can be quite different (e.g., McKay et al., 2007). Therefore, to
promote minority representation, future researchers should consider alternative
sampling strategies to source a sizable non-White sample. Multiple minority groups
could thus be examined individually, rather than combining different racial minorities into
one group.
Conclusion
We proposed that in a given diversity climate, psychological safety perceptions shape
employee performance and that racial differences in employees’ psychological reactions
and behaviours will surface. Our results support our arguments, as we found psychological
safety mediated the path of diversity climate and employee performance, and race
moderated these relationships. In summary, in a racially diverse work environment,
perceptions of psychological safety do matter in shaping employee performance.

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