Fostering Fairness and Inclusion: How Leadership Shapes Diversity Climate and Job Satisfaction in Universities

Abstract

Fairness in the workplace is crucial for employee satisfaction. This study examines the relationship between inclusive leadership, organizational justice, perceived diversity climate and job satisfaction among university faculty, drawing on Fairness Heuristic Theory as guiding framework. By employing a quantitative, cross-sectional design, data were collected from 230 faculty members across six universities in Pakistan through a structured questionnaire, anchored responses on a five-point Likert scale. To test hypothesis in structural model Partial Least Squares Structural Equation Modelling (PLS-SEM) was employed. The findings reveal that inclusive leadership positively linked to organizational justice, which in turn significantly predicts perceived diversity climate. Perception about diversity climate is associated with enhanced job satisfaction. Mediation analysis indicates that organizational justice and diversity climate sequentially mediates the relationship between inclusive leadership and job satisfaction. The study extends Fairness Heuristic Theory to the higher education context, integrating diversity climate as a key attitudinal outcome of justice perceptions. Practical implications highlight the need for transparent decision-making, equitable resource allocation, and inclusive leadership practices to foster fairness, strengthen diversity climate, and enhance faculty satisfaction. Limitations include the cross-sectional design, convenience sampling, and the context-specific focus on higher education, suggesting avenues for longitudinal and cross-sectoral research.