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Introduction
In this paper, we study the relationship between demographic diversity on boards and a dimension of employer/employee relationship (EER) that focuses on human resource management (HRM). In recent years, many studies have been conducted on demographic diversity (e.g. Heckel et al., 2017; Leonard and Levine, 2006; Syed and Kramar, 2009; Verbeek and Groeneveld, 2012; Giuliano and Ransom, 2013; Li et al., 2017). However, the effect of demographic diversity on boards on EER has not been sufficiently studied. On the one hand, it remains unclear whether and how demographic diversity on boards may influence EER. On the other hand, it is not clear either whether there is any contextual factor that may moderate the relationship between the diversity and EER. Our study contributes to the diversity and EER literature by addressing these research gaps.
According to research (e.g. Li et al., 1999, 2017; Richard, 2000), demographic diversity can be defined as the extent to which a group or organization is heterogeneous with respect to certain demographic characters of its members, such as gender and race. While demographic diversity consists of many different dimensions, such as gender diversity, education diversity, and ethnic diversity, research on this diversity has focused mainly on two of the most visible dimensions, i.e. gender dimension and ethnic one. Consistent with this tendency, our current study focuses on the effects of gender and ethnic diversities when considering the relationship between demographic diversity and EER.
Researchers have defined EER from different perspectives (Countouris, 2016), such as economic and legal perspective (e.g. Countouris, 2016; Flammer and Luo, 2017), leadership perspective (e.g. Einarsen et al., 2016; Wang et al., 2005), and HRM perspective (e.g. Abdullah, 2017; Luo et al., 2014). In this paper, we study EER from a HRM perspective. According to prior research, EER from the HRM perspective can be defined as “how well firms take care of and build long-term relationships with internal stakeholders of employee” (Luo et al., 2014, p. 499). Based on this definition, we further define EER as an important dimension of HRM performance that can affect the mutual understanding and cooperation between a firm’s management and its employees. The main reason to adopt a perspective of HRM to define EER is that...