LINKING SUSTAINABLE HRM WITH ORGANIZATIONAL PERFORMANCE: A STRATEGIC PERSPECTIVE FROM HYDERABAD’S PHARMA SECTOR

Abstract

The increasing focus on sustainability and its implication for HRM, has turned HRM from an administrative practice to a strategic weapon which contributes to the competitive advantage of the organization. In this paper, we explore the association between SHRM practices and organizational performance in the pharmaceutical industry in the “Pharma Capital” of the India, i.e., Hyderabad. Utilizing the Resource Based View (RBV), Institutional Theory, as well as the Ability-Motivation-Opportunity (AMO) framework, the theoretical paper explores how the dimensions of SHRM, such as green HRM, ethical HRM, employee well-being, diversity and inclusion, and work–life balance, lead to financial and non-financial outcomes. Based on a quantitative cross-sectional research design, data were gathered in the form of a structured questionnaire from 300 employees and HR managers from big pharmaceutical companies. The reliability and validity tests (Cronbach’s Alpha, KMO, Bartlett’s Test) assured the measures’ scales as good ones. Analytical methods like descriptive statistics, correlation, regression analysis, and mediation modeling were used to test the hypothesis. The findings indicate that SHRM has a strong influence on the organizational performance, and employee welfare and ethical HRM were the strongest predictors. Green HRM had noticeably higher impact on innovation outcomes, however the influences of diversity and work–life balance were relatively less. Introduction Mediation analysis indicated that employee engagement acted as a partial mediator in the relationship between SHRM and performance, signifying employee engagement as a central mechanism by which sustainable HR strategies have an impact on tangible organization-level outputs. In addition, differences based on tenure show that perceptions of SHRM adoption strengthen with the length of organizational experience.