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Diversity Identity Management: An Organizational Perspective
Brooklyn M. Cole • Manjula S. Salimath
Received: 23 February 2012 / Accepted: 18 August 2012 / Published online: 29 August 2012
� Springer Science+Business Media B.V. 2012
Abstract Organizations are faced with the challenge of
responding to increasing pressures to promote diversity in
various ways. We draw attention to one possible proactive
organizational response—the incorporation of diversity in
organizational identity. This initial response necessarily
evokes subsequent tasks of managing the changed identity.
Therefore, this article also addresses the management of
diversity identity within organizations, and relevant orga-
nizational outcomes. Our theoretical model is grounded in
institutional theory, and we propose that the management
of diversity identity can impact both perceptions of legit-
imacy as well as diversity identity. Adequate, inadequate,
and optimal management of diversity identity have dif-
ferential effects on legitimacy and diversity identity. We
contribute to the literature by a) unbundling initial and later
firm responses to promoting diversity at the organizational
level, and b) offering a more nuanced understanding of the
complexities of managing diversity identity within
organizations.
Keywords Diversity identity � Institutional theory �Legitimacy � Backlash � Identification
Introduction
Diversity issues have received increased attention in the
last 30 years as our societal demography has begun to
change. For example, the Bureau of Labor Statistics (2008)
reports that the United States workforce is represented by
over 50 % females and minorities. Approximately, 34 % of
the employed individuals in the private sector are catego-
rized as belonging to one of the minority race groups (U.S.
Equal Employment Opportunity Commission 2009), and
this number is continuing to rise. While a number of def-
initions of diversity exist, in its most narrow form, surface
level diversity or demography is focused on visible dif-
ferences between individuals based on gender, race, eth-
nicity, and disabilities (Gilbert and Stead 1999; Point and
Singh 2003). Surface level diversity is, therefore, harder to
conceal than other forms of diversity, because of its visible
nature.
In response to increasing demographic diversity in the
workplace, various formal and informal mechanisms have
evolved in many societies that tend to expect organizations
to incorporate and promote diversity. These mechanisms
range from informal norms, practices, and ethical guide-
lines to respect diversity, as well as formal rules, laws, and
institutions that require organizational compliance to avoid
penalties. Stakeholders create the informal pressures that
induce formal organizational diversity policies and prac-
tices. Informal pressures by groups advancing their inter-
ests (though originating as unsanctioned by formal
authority) later become integrated (Mintzberg 1983). In
addition, formal institutions such as the legal system deli-
ver mandates that require compliance. Thus, diversity
issues are at the forefront of the business–society debate.
As scholars have suggested, ‘‘To manage the growing
diversity of the workforce, organizations may need to
B. M. Cole (&)
University of North Texas, 1305 W. Highland, Room 304F,
1155 Union Circle #305429 (USPS), Denton, TX 76201, USA
e-mail: [email protected]
M. S. Salimath
University of North Texas, 1305 W. Highland, Room 325D,
1155 Union Circle #305429 (USPS), Denton, TX 76201, USA
e-mail: [email protected]
123
J Bus Ethics (2013) 116:151–161
DOI 10.1007/s10551-012-1466-4
implement systems and practices so that the potential
advantages of diversity are maximized and the potential
disadvantages are minimized’’ (Cox 1994; McMillan-
Capehart et al. 2009). Hence, diversity management
becomes an important organizational task that requires an
organizational perspective for its full understanding.
No doubt, expectations (to incorporate diversity) are
ethically, socially, politically, and economically pertinent
to the well-being of organizations. Yet, firm responses to
such diversity-related demands can vary. For example,
organizations can choose to be reactive or proactive in their
response to diversity issues. Among the many proactive
responses, organizations may decide to actively include
diversity as a component of their identity. Such inclusion is
possible because organizational identity is malleable to
societal ‘‘issues’’ and expectations (Dutton and Dukerich
1991). ‘‘An organization’s identity reflects its central and
distinguishing attributes, including its core values, organi-
zational culture, modes of performance, and products’’
(Elsbach and Kramer 1996: 442). Hence, incorporating
diversity in an organization’s identity reflects the adoption
of a favorable societal value.
However, including societal values may not always
translate to economic benefits for the organization. Inter-
estingly, prior diversity research is inconsistent as to the
benefits and drawbacks of diversity identity incorporation,
contending it is a ‘‘double-edged sword’’ (Trefry 2006).
Conflicting results were reported about diversity’s direct
influence on positive organizational outcomes (Gilbert and
Stead 1999; Gonzalez and DeNisi 2009; Hamdani and
Buckley 2011). In particular, those organizations focusing
solely on economic gain derived from diversity have been
disappointed with negative results (Pless and Maak 2004).
Consequently, researchers have explored alternate out-
comes that organizations may experience from incorpo-
rating diversity, such as increased legitimacy (Martin,
Johnson, and French 2011; Hamdani and Buckley 2011;
Harris and Wicks 2010).
While some criticize this inclusion (alluding that the
incorporation of diversity in the organization’s identity is
merely a ‘‘window dressing’’ conveyed to satisfy societal
pressures), evidence of increased external legitimacy per-
ceptions have been found, indicating that the organization
is indeed receiving a benefit (Bartkus and Glassman 2008).
This supports the firm’s proactive rather than reactive
efforts to promote diversity identity to external stakehold-
ers. Still, this does not necessarily predict either the internal
adoption of practice, or the outcome of perceived legiti-
macy (Dobbin et al. 2011). Organizations that promote a
diverse identity but fall short in its actual practice will lose
perceived legitimacy; therefore, it is necessary to actively
manage diversity identity. Further, we believe that incon-
sistent results from prior research may likely be due to
variations in the extent to which diversity identity is
effectively managed within organizations.
The internal practice, or management, of diversity iden-
tity varies between organizations. We define diversity
identity management as including but not limited to the
voluntary communication of diversity beliefs to stakehold-
ers as well as the implementation of internal diversity pro-
grams and policies. We argue that the management of
diversity identity is broader than that of diversity manage-
ment alone, which is focused predominately on the internal
actions and policies of the organization (Ivancevich and
Gilbert 2000). Hence, management of diversity identity
includes the organization’s promotion of diversity as a core
value to society through strategically designed statements
(Point and Singh 2003). Richard et al. (2007) found that
organizations benefit from the promotion and strong (rather
than weak) management of diversity. While this makes sense
intuitively, it must be noted that identity is a dynamic and
multiplex construct and consists of various other elements
(e.g., other identities such as professional identity, role
identity, etc.). It is likely that as the promotion of diversity
identity increases, it is at a cost to various other identities that
employees may associate with. While the perceptions of an
organization’s diversity identity by the minority group/
women as well as white males have been evaluated (Mollica
2003; Dobbin et al. 2011; Thomas and Wise 1999), it is
surprising that perceptions of the rest or full spectrum of
employees has not yet been assessed. In addition, the
majority of prior research has focused on individual level
outcomes, ignoring organizational consequences. Thus, we
take an organizational perspective to address diversity
identity management. To the best of our knowledge, there is
no discussion either on the balance between promotion/
reduction of one identity aspect such as diversity versus
another identity aspect such as professional identity, on
relevant organizational outcomes such as legitimacy.
The primary purpose of this article, therefore, is to
contribute to the literature by unbundling initial and later
firm responses to promoting diversity at the organizational
level (see Fig. 1). We consider organizational responses to
stakeholder pressures to incorporate diversity as well as the
consequences of such action at the organizational level.
Initial proactive responses may include the creation of a
diversity identity. This response is sufficient to ensure
legitimacy and diversity identity to external stakeholders.
Later responses may include efforts to actively manage the
diversity identity to minimize threats to legitimacy. This
later response is necessary to ensure legitimacy and diver-
sity identity internally to employees and organizational
members. We examine differential effects of diversity
identity management and their impact on organizational
outcomes such as legitimacy. We contend that although
unnecessary in the external environment, the active
152 B. M. Cole, M. S. Salimath
123
management of diversity identity is critical internally for
minimizing threats to legitimacy. Throughout, we ground
our explanations in institutional theory.
The rest of this article is organized as follows. We begin
by discussing the societal pressures for diversity adoption
and the influence on organizational outcomes of legitimacy
and identity. Next, we discuss the incorporation of diver-
sity in the organization’s identity, and the management of
diversity identity. The theoretical model, illustrative fig-
ures, and propositions are provided as well as implications
and future directions for research (Fig. 2).
Propositions
Stakeholder Pressures to Promote Diversity
in Organizations and Institutional Theory
Institutional theory (Selznick 1949; Meyer and Rowan
1977; DiMaggio and Powell 1983) examines the way in
which structures are formed by society and become
ingrained. Examples of structures include rules, norms, and
other established criteria for social behavior. Institutional-
ization is important as it can impact an individual’s per-
ception of legitimacy of an organization. By utilizing
visible symbolic cues, such as diversity management pro-
grams or diversity statements, organizations construct
perceptions of legitimacy among key stakeholders. Such
cues are additionally signaled by—compliance with legal
requirements, accreditations, professional association
membership, and media (MacLean and Behnam 2010). To
trace the formal incorporation of diversity in the organi-
zation’s identity, we can look at the informal drivers that
have led to the evolution of diversity statements and
management as a result of coercive, normative, and
mimetic isomorphic pressures (DiMaggio and Powell
1983, 1991; McKinley et al. 1995) on the organization.
Coercive pressures occur when there is a threat of adverse
consequences if the organization does not adopt standard
practices or obey laws and regulations. The 1960s marked the
beginning of employment reform with the Civil Rights
Movement. During this period, strong action was taken by
government to legally address injustice against the African
American race. The initial push originated in 1961, by Pres-
ident Kennedy when he first introduced the term affirmative
action. Affirmative action (AA) was imposed upon federal
contractors initially to ensure that ‘‘race, creed, color, or
national origin’’ would not bias employment (Kelly and
Dobbin 1998). This major legal action was followed by the
1964 Civil Rights Act in which Title XII made employment
discrimination illegal (Kelly and Dobbin 1998). In 1965,
President Johnson’s modification of Kennedy’s original AA
Order, included the addition of sex as well as mandated public
and government organizations to include a prewritten state-
ment constructed to promote equality and fair hiring practices
(Wilkins 2004). Although the legal mandate became a legit-
imizing factor for organizations, the enforcement and mea-
surement remained ambiguous (Kelly and Dobbin 1998). To
combat the increased lawsuits that arose from noncompliance,
organizations began the practice of hiring equal employment
opportunity (EEO) and AA specialists (Wilkins 2004; Kelly
and Dobbin 1998).
Normative pressures are predominately unspoken and
include assumptions about standard operating procedures.
Normative pressures are communicated through peers and
employees of an organization. The initial shift to diversity
management within organizations occurred in the early
1980s. The shift has largely been associated with the
election of President Reagan who campaigned on the ini-
tiative of reducing the ‘‘bureaucratic control’’ found in such
Federal implemented policies as EEO and AA (Kelly and
Dobbin 1998). With cuts to these programs there emerged a
resistance by human resources, EEO, and AA specialists.
With a desire to maintain their role in the organization,
they began to reframe the existing reason for its inclusion.
Selznick (1949) discussed how certain institutionalized
processes, instead of being deinstitutionalized, become
repurposed and a new purpose for the existing formal
procedure is developed (Kelly and Dobbin 1998). When
the decline in governmental acceptance of the legally
mandated EEO and AA positions emerged, a reframed
purpose for it was developed through societal pressures and
organization interdependence (Yang and Konrad 2011).
The implementation of diversity practices allowed for more
objective recruitment, hiring, and promotion (Kelly and
Dobbin 1998). With the change in meaning also came a
change in wording. No longer was diversity management a
legal policy but a beneficial program, and having a diver-
sity statement became a norm.
Initial Response
Incorporation of Diversity in Identity External Legitimacy and Diversity Identity
Later Response
Management of Diversity in Identity Internal Legitimacy and Diversity Identity
Fig. 1 Unbundling proactive firm responses to promote diversity
P2 P3 a, b, c
1P
Fig. 2 Theoretical model of proactive firm responses to diversity
issues
Diversity Identity Management 153
123
Mimetic effects are caused when isomorphic pressures
promote similar formal structures among organizations
within the same field (DiMaggio and Powell 1991;
McKinley et al. 1995). Mimetic processes occur when an
organization copies, or mimics, aspects of other similar
organizations. Organizations tend to mimic others’ diver-
sity management practices especially when they promote
legitimacy perceptions. The acquisition of legitimacy (even
via mimicry) is important as it helps to enhance the sur-
vival rates of organizations (DiMaggio and Powell 1991).
When an anticipated component is absent—in this case the
incorporation of diversity in identity—the organization
runs the risk of losing legitimacy by not incorporating what
has been informally demanded by stakeholders and inte-
grated by others as formal practice.
By demonstrating conformity with societal issues,
through the formal incorporation of diversity policies,
(Nemetz and Christensen 1996), organizations gain legiti-
macy (Yang and Konrad 2011). As new entrants join the
population or competition heightens in an industry, insti-
tutional theory predicts that an organization’s pursuit of
legitimacy increases isomorphic pressure on the organiza-
tion and leads to homogeneity among organizations in an
industry. This pursuit of legitimacy causes organizations to
adopt socially desired practices that interest groups con-
sider important and other organizations currently support.
The implementation of practices and standards of legiti-
mate organizations are both economic and noneconomic in
nature (Harris and Wicks 2010). The pressure to adopt
diversity is informally pushed even though it may have no
bearing on the organization’s bottom line (Hamdani and
Buckley 2011). Coercive, normative, and mimetic institu-
tional pressures to incorporate diversity impact organiza-
tions. Those that reflect stakeholder expectations are likely
to be perceived by stakeholders to have external legitimacy
and diversity identity, while those that do not reflect
stakeholder expectations tend to experience external threats
to legitimacy and diversity identity. Therefore:
Proposition 1 Stakeholder expectations of diversity cre-
ate institutional pressures that affect external legitimacy
and diversity identity of organizations.
Incorporation of Diversity in Identity
Organizations have a range of responses that they may
choose from to face the issues of diversity inclusiveness.
Incorporation of diversity in an organization’s identity
requires significant commitment and effort on the part of
the organization, as it reflects a greater commitment than
surface level or image based diversity initiatives. For
example, on the low end of diversity incorporation, an
organization will rely on affirmative action or equal
employment opportunity statements. These are considered
‘‘remedial’’ (Kidder et al. 2004), as they are government
mandated and have become considered an expected prac-
tice. As the organization’s goal shifts from compliance to
awareness and acceptance, they should engage in diversity
training programs and events (Valentine and Page 2006).
Finally, organizations that truly drive home diversity ini-
tiatives, beyond that of compliance or awareness, will
begin to incorporate diversity as a key component in
strategy and mission formulation. This high level form of
diversity inclusion cascades from the top down and is
recognized as a substantial driver for organizational
success.
Many organizations are arranged by bureaucratic
methods (DiMaggio and Powell 1991); however, as dis-
cussed earlier, pressures from both internal and external
stakeholders informally influence identity formation
(Martin et al. 2011; Nemetz and Christensen 1996). Iden-
tity is the internal assembly of cues that reflect what
members believe to be central to the organization (Chris-
tensen and Askegaard 2001; Gatewood et al. 1993; Nguyen
and LeBlanc 1998). ‘‘Identity means the sum of all the
ways a company chooses to identify itself to all its pub-
lics—the community, customers, employees, the press,
present and potential stockholders, security analysts, and
investment bankers’’ (Margulies 1977: 66).
Organizations strive for continuous identity, meaning
that the overall identity is fluid in its interpretations as each
individual puts more weight on different issues thus pro-
ducing various views (Gioia et al. 2000; Holzinger and
Dhalla 2007). With the development of a more reflexive
and interactive identity comes the notion of multiple
identities (Gioia et al. 2000) in which organizations try to
portray different identities to relate to stakeholders. The
communication of certain identities will resonate more
with one particular group of individuals than others
(Nguyen and LeBlanc 1998; Riordan et al. 1997).
The benefit from an identity that resonates with the
values of its key stakeholders (Dutton and Dukerich 1991),
with regards to diversity, has been explored. For example,
Thomas and Wise (1999) found that diversity policies were
significant to people seeking employment. Likewise, Wil-
liams and Bauer (1994) show that the firm’s adoption of a
diversity management program and having a formal state-
ment/stance will aid in enhancing perceptions of the
organization.
As organizational identity is malleable to societal issues
such as diversity, firms may choose to respond to institu-
tional pressures created by stakeholders by proactively
incorporating diversity in their identity. Extant research
(discussed above) has been established that organizational
identity is not monolithic, but is multiplex and dynamic,
consisting of varied components. Further, organizational
154 B. M. Cole, M. S. Salimath
123
identity is evolving and adaptive to external demands.
Hence, inclusion of diversity in an organization’s identity
is plausible and constitutes a proactive, formal response to
stakeholder pressures. Therefore:
Proposition 2 Proactive responses to stakeholder pres-
sures for diversity lead to the formal incorporation of
diversity in an organization’s identity.
Diversity Identity Management and Organizational
Outcomes
After addressing the early responses (incorporating diver-
sity in identity), we next examine later-stage firm responses
to promoting diversity in organizations (management of
diversity identity). It is likely that organizations may pro-
vide the initial response to stakeholder pressures by
incorporating diversity in their organizational identity to
generate positive perceptions of external legitimacy and
diversity identity. By responding in such a proactive
manner, organizations can avoid threats to their perceived
legitimacy and diversity identity from stakeholders.
However, if organizations stop with this initial response,
and do not make efforts to manage the newly formed
diversity identity, it can cause detrimental outcomes in the
form of internal threats to perceived legitimacy and
diversity identity. That is, a poorly managed diversity
identity can create doubts about the authenticity of the
newly formed identity, which threatens internal legitimacy
and diversity identity among its employees and members.
Organizations often do stop with the initial response for
a variety of reasons. For example, in the organization’s
struggle to compete with other organizational identities, the
organization may communicate how they desire their
company to be perceived (Daft and Lengel 1986) with
partial or overly optimistic truths of the organization’s
identity (Christensen and Askegaard 2001; Cable and
Graham 2000). This identity portrayal, when compared
with reality, threatens the organization’s internal legiti-
macy. Decoupling (or the separation or gap between a
corporation’s depiction of itself and reality) influences both
internal and external legitimacy perceptions and behaviors
(MacLean and Behnam 2010; Meyer and Rowan 1977).
Institutional theory suggests that decoupling is a routine
response that may benefit organizations. ‘‘Decoupling
enables organizations to maintain standardized, legitimat-
ing, formal structures while their activities vary in response
to practical considerations’’ (Meyer and Rowan 1977: 357).
While the general incorporation of diversity in the orga-
nization’s identity gains external legitimacy, we argue that
the degree to which an internal program is enforced and
managed will influence the organization’s internal legiti-
macy and internal diversity identity. Thus, the later stage
response to stakeholder pressures (managing diversity
identity) is crucial for establishing both internal legitimacy
and removing threats to diversity identity. As we will later
discuss, these organizational outcomes are moderated by
the extent to which diversity identity is managed.
Organizational outcomes of formal diversity programs
are difficult to assess because the goals of the programs are
frequently unspecified (Nemetz and Christensen 1996). In
addition, the organizational outcomes are impacted based
on individual interpretations. The degree to which an
individual identifies with diversity plays a role in their
perception of need for a diversity program (Nemetz and
Christensen 1996). The complexity of the individuals’
interpretation of diversity identity management makes it
imperative for organizations to effectively manage their
diversity identities such that it is in congruence or balanced
with other identity components.
Individuals will perceive a policy as legitimate to the extent
that they understand that others see it as appropriate, and it
aligns with their social identity (Tost 2011) or other identity
components. Organizations that convey diversity as a com-
ponent of identity are more susceptible to positive image
creation by individuals that perceive identity congruency
(Williams and Bauer 1994; Cox and Blake 1991). Identifi-
cation congruency is assessed by the similarity between the
individual and the organization (Grice et al. 2002). It is
important because the organization’s success is tied to indi-
viduals’ identification with the organization (Fuller et al.
2003). As a person starts to perceive similar core attributes or
characteristics by which they categorize themselves, they
begin to identify with the organization (Gonzalez and DeNisi
2009). For example, when an individual perceives a large part
of their self-identity to be female, then their perceptions of
policies affecting women within the organization will influ-
ence perceptions of the organization’s identity, and conse-
quently, internal legitimacy.
In a similar vein, Highhouse et al. (1999) found that
African-Americans were more likely to apply for a job when
the organization was considered identity-conscious (affir-
mative action) versus identity-blind (equal employment).
Goldberg and Allen (2008), found that race moderated the
relationship between diversity statements and engagement,
such that there was a significant positive relationship for
African Americans but not for Caucasians. In other words,
African Americans respond favorably to diversity state-
ments, while white males showed no significance. Dobbin
et al. (2011) found that in organizations with few white
women in management, diversity practice adoption was
more prevalent, making it more attractive to females.
Lack of congruence likewise leads to potential negative
organizational outcomes. When there are changes or actions
that are perceived to be inconsistent with the organization’s
identity, then employees will begin to question and doubt
Diversity Identity Management 155
123
what the company stands for (Dutton et al. 1994). For
instance, employees, recruited under a false assumption of
the organization’s identity, will perceive a psychological
contract breach if the organization’s internal actions differ
from its external persona (Pratt 2000; Cropanzano and
Mitchell 2005). When there is a perceived breach by the
organization, internal legitimacy perceptions will decline,
thus creating a threat to the organization’s legitimacy
(Eisenberger et al. 1986).
Bartkus and Glassman (2008) conclude incorporating
stakeholder issues, e.g., diversity, in mission statements,
made people of the minority group ‘‘feel better’’; however,
similar to decoupling discussed earlier, they found no
connection between mission statements and practice of
policies. The organization may tout diversity and rely on
propaganda instead of an actual diversity program (Cox
and Blake 1991; Nemetz and Christensen 1996). As the
organization’s facade begins to fade, and the lack of
diversity management is seen, a misalignment will be
perceived. ‘‘As a consequence of the mismatch between
formal and informal organization practices and values,
target individuals may become cynical about formal
diversity programs’’ (Nemetz and Christensen 1996: 451).
Colorblindness and low minority representation is threat-
ening to minorities (Purdie-Vaughns et al. 2008) and thus
threatens the organization’s legitimacy. Therefore, the
ideal combination occurs when diversity is incorporated in
identity and practice.
Apart from practicing diversity inclusion within the
organization, it is important to note that effective diversity
identity management is equally critical. As organizational
identity is composed of multiplex components, emphasizing
one to the detriment of other identities can be problematic.
This is illustrated by the finding that though the implemen-
tation of a diversity management program was found to
produce a more attractive and professional environment for
minority employees to succeed (Gilbert and Stead 1999),
other employees had different views on the inclusion of
diversity in the organization’s identity. Further, white males
were found to perceive layoffs of other white males as less
fair when the organization had an active diversity policy in
place (Mollica 2003). This relates to the discussion above on
emphasizing one identity component to the detriment of
other aspects of organizational identity. As the same indi-
vidual may identify with multiple identities (e.g., as a
member of a minority, a role, a professional category, etc.), it
is necessary to manage diversity identity so that they do not
override or are overridden by other identity elements. When
managed effectively, diversity identity can coexist and
support other identity elements within the organization and
reduce threats to diversity identity and legitimacy.
Overall, it is important for the organization to cultivate a
sense of support for diversity that is neither excessive nor
inadequate. Perceived organizational support (POS)
‘‘strengthens the effects of equal opportunity attitudes…as
well as individuals’ sensitivity to organizational poli-
tics…’’ (Cropanzano and Mitchell 2005: 877). Yet too
much of a good thing can be problematic. By excessively
promoting diversity identity, the organization is ignoring
other employee identities, which may lead to perceptions
of unequal and unfair support.
Hence, we argue that inadequate diversity identity
management threatens organizational legitimacy as per-
ceived by the minority group, while excessive diversity
identity threatens legitimacy perceptions of other employee
identities. Organizations should be cognizant of this limbo
of diversity identity promotion (over and under emphasis).
Hence, we introduce the notion of extent of diversity
identity management, and initiate discussion of a more
refined and nuanced understanding of this concept. Orga-
nizations need to give pause and consider how exactly
diversity identity can fit with the other identity compo-
nents, so that desired goals can be achieved in a harmo-
nious and inclusive fashion. A failure to do so may quickly
propel the organization to either over or under emphasize
diversity identity (relative to other identities), and lead to
resistance, discontent, and threats to legitimacy and
diversity identity. On the other hand, a balanced and
optimal emphasis on diversity identity (relative to other
identity components) will reduce threats to its diversity
identity and internal legitimacy among all employee
identities within the organization. As shown in Figs. 3 and
4, we predict a U-shaped relationship between diversity
identity management and threats to both internal legitimacy
and diversity identity. Therefore:
Proposition 3 Incorporation of diversity in the organi-
zation’s identity influences organization’s internal legiti-
macy and diversity identity to the extent that the
organization actively manages their diversity identity.
a. Inadequate diversity identity management results in a
threat to organization’s diversity identity and negative
legitimacy perceptions.
b. Excessive diversity identity management results in a
threat to organization’s diversity identity and negative
legitimacy perceptions.
c. Optimal diversity identity management creates positive
organizational diversity identity and also minimizes/
eliminates diversity identity threat.
Discussion
Exponential increases of diverse individuals within the
American population have resulted in concentrated
research on diversity issues. Over the past 30 years, the
156 B. M. Cole, M. S. Salimath
123
United States has witnessed a dramatic change in the make-
up of the workforce. It appears the melting-pot mentality
with emphasis on a homogenized workforce is giving way
to a more multicultural perspective in which diversity is not
only respected but desired (Ivancevich and Gilbert 2000).
Though diversity issues have attracted much attention, we
posit that most of this is directed toward initial diversity
inclusion, with hardly any efforts being made to understand
its implementation and management in tandem with other
identity components within the organization. This article
fills this gap by addressing both early and later firm
responses to diversity identity. It has been argued that
whether organizations desire diversity or not, they are
pressured by stakeholders to portray and incorporate it into
their identity to maintain legitimacy. We contend that the
formal management of diversity is not in and of itself bad,
however; at the same time, it cannot simply be assumed to
be always positive. We consider the diversity identity of
organizations to be one of several components, and stress
that its inclusion should necessarily consider the other
elements of employee identity. Thus, a simplistic approach
to include diversity identity and increase its relevance
without paying attention to how it fits and integrates with
other elements would be detrimental to organizational well
being.
We have highlighted studies that showcase the positive
outcomes of multicultural representation from the minority
group (Hamdani and Buckley 2011; Perkins et al. 2000) as
well as those that have discussed its flaws (Purdie-Vaughns
et al. 2008; Nemetz and Christensen 1996; Mollica 2003).
Part of the motivation behind this article came from the
underwhelming lack of research on organizational conse-
quences of continually increasing diversity identity and
practice. We shed light on the potential for internal threats
to legitimacy due to the constant promotion of one identity
at the cost of other identities that employees may belong to.
At the same time, we also address the problems that may
arise from an under emphasis of diversity identity within
the organization.
While the internal management and incorporation of
diversity into the organization’s identity can create bene-
fits, such as creativity (Hamdani and Buckley 2011),
approval (Bartkus and Glassman 2008; Nemetz and
Christensen 1996), and legitimacy (Tost 2011; Hamdani
and Buckley 2011), we caution that it cannot be done
without an adequate assessment of its inclusion, relative to
other identity components and employees. Negative
responses to increased diversity identity practice can lead
to group isolation, hostility, or resentment (Nemetz and
Christensen 1996; Mollica 2003) by other employees.
Hence, while managing the organization’s diversity iden-
tity, managers should simultaneously take care to ensure
inclusion, fairness, and equality of all employee identities.
Yet this is easier said than done. It has been noted that
organizations have not been very successful in managing
diversity (Cox and Blake 1991). While there is an adequate
amount of information out on diversity policies and dis-
crimination, employees’ perceptions and reactions to such
policies are scarcer (Roberson and Stevens 2006; Friedman
and Davidson 2001). Diversity management is a complex
and nuanced phenomenon, which can generate organiza-
tional consequences that may be beneficial, ambivalent, or
detrimental.
According to Friedman and Davidson (2001), discrimi-
nation is a first-order conflict that disproportionately affects
the subordinate level members (composed predominately
of women and minorities), and is easily identifiable.
Organizations address this conflict by implementing diversity-
focused policies. Interestingly, these newly developed
remedies (affirmative action, diversity training, minority
mentoring, etc.) created to combat the first-order conflict
(discrimination) have resulted in their own, more ambiguous,
second-order conflicts. Second-order conflicts are hidden, and
Excessive Management
Inadequate Management Optimal Management
Fig. 3 Diversity identity management and threat to internal diversity
identity
Inadequate Management
Excessive Management
Optimal Management
Fig. 4 Diversity identity management and threat to internal
legitimacy
Diversity Identity Management 157
123
although they affect both upper and lower level employees,
they remain relatively un-discussed. Effective diversity identity
management would be instrumental in reducing second-order
conflicts.
The outcomes of diversity identity management can differ
among various organizational members, adding to the
complexity of this phenomenon. While the enactment of
diversity programs offer reassurance, help, and supportive
social relationships for some individuals, the same program
may be perceived by others as violating individual rights,
thereby creating perceptions of reverse discrimination. As
organizations try to find a balanced way to emphasize
diversity awareness, they may get carried away in the
implementation of complex policies and end up creating
more harm than good (Cropanzano and Byrne 2001).
Two additional streams of research support arguments
related to our last set of propositions (propositions 3a, b, c),
i.e., social exchange theory and the justice literature, and
these are briefly presented below. Both inadequate and
excessive management of diversity identity can adversely
affect the organization’s legitimacy and threaten its
diversity identity because of the processes of social
exchange and justice.
Social Exchange Theory (SET) is based on reciprocity
or a perceived obligation that action will follow an initial
move by another party. ‘‘An employee is involved in at
least two social exchange relationships at work: one with
his or her immediate supervisor and one with his or her
organization’’ (Masterson et al. 2000: p. 740). Exchange
ideology, ‘‘strengthens the effects of equal opportunity and
attitudes…as well as individuals’ sensitivity to organiza-
tional politics…’’ (Cropanzano and Mitchell 2005: p. 877).
Individuals are continually assessing the organizations’
commitment to them as well as their own commitment to
the organization. As a result, employees in exchange
relationships alter their inputs to match that of the orga-
nization (Eisenberger et al. 1986). Perceived diversity
support by an organization raises expectations of exchange.
Employees form ‘‘global beliefs’’ about the organization
and its values and then act based on whether they perceive
support. As employees develop beliefs of whether the
organization values their contributions and cares about
them to determine need for increased work effort, indi-
viduals give the organization human-like characteristics
influenced in part by the policies of the organization
(Rhoades and Eisenberger 2002). Such ‘‘personification of
the organization’’ (Levinson 1965) may apply to the
diversity management issues as well. Consequently,
excessive or inadequate diversity management would
trigger threats to diversity identity and legitimacy because
of poor social exchange mechanisms.
Reactions to an organization’s diversity initiative may
also be affected by employees’ perceptions of fairness
(McMillan-Capehart et al. 2009). Fairness is frequently
looked at as organizational justice. Organizational proce-
dures can be used to promote a sense of workplace justice
and are also necessary to protect individuals’ rights within
organizations (Cropanzano and Byrne 2001).
Organizational justice is the general fairness of policies,
practices, and rewards etc. (procedural). There are three
justice types: procedural, distributive, and interactional.
Procedural justice is the perception of the fairness of for-
mal policies and procedures that govern decisions. Inter-
actional justice is based on the fairness of the quality of
interpersonal treatment (e.g., by a manager). Distributive
justice is related to the perceived fairness of outcomes
(Colquitt et al. 2001).
Underrepresented groups are more cognizant of the
presence or absence of procedural justice (Barone 1996;
cited in Buttner et al. 2010b). Perceived discrimination will
lead to judgments of injustice (Triana and Garcia 2009).
Kossek and Zonia (1993) suggest that white employees are
less aware of the importance of diversity promises, perhaps
because of the salience perceptions of their own ethnic
identity group. In addition, women value organizations that
promote diversity more favorably than males. Likewise,
efforts to increase diversity are embraced by those who
occupy lower levels of decision making in the organization
(white women and minorities).
Justice is important in the organization because employ-
ees who feel they are unfairly treated are more likely to lose
trust or perceive a contract breach, and thus are less likely to
give back to the organization through behaviors such as
citizenship behavior or commitment (Colquitt et al. 2001).
There is variation in employees’ perceptions of justice and
the behaviors acted toward the perceived culprit of the
injustice (e.g., the organization). ‘‘That is, perceived orga-
nizational support would be influenced by the frequency,
extremity, and judged sincerity of statements of praise and
approval’’ (Blau 1964: p. 501).
Diversity initiatives that are inadequately managed have
negative effects on employees of color such as satisfaction,
commitment, and turnover (Buttner et al. 2010a), as well as
white backlash from second-order conflict (Friedman and
Davidson 2001). Backlash is a ‘‘negative response to a
decision or policy that occurs when a person thinks that
others have received underserved benefits’’ (Crosby and
Gonzalez-Intal 1984; cited in Kidder et al. 2004). The
diversity initiatives may be perceived by white males as a
threat to group identity and a challenge to their existing
power.
The way in which a diversity program is discussed or
‘‘justified’’ influences acceptance (Kidder et al. 2004).
Richard and Kirby (1999) found there is a significant dif-
ference in the attitudes of African-American students
regarding diversity programs based on the organization’s
158 B. M. Cole, M. S. Salimath
123
justification. Implementing diversity programs that are
unjustified results in negative attitudes and feelings direc-
ted toward the organization such as feelings of incompe-
tence, dissatisfaction, and lack of commitment. However,
when procedural justification was used to state the need for
diversity programs, the results were more favorable for the
organization and resulted in more positive attitudes in
general (Richard and Kirby 1999). As seen in other studies,
a greater backlash existed for affirmative action justifica-
tion than diversity management. Overall outcome favor-
ability impacted negative emotions. How the program was
justified had a significant impact on attitude toward the
program (Kidder et al. 2004).
Management policies (including human resources
management) influence perceptions of procedural fairness
and sends a signal about the organization as a whole (Wu
and Chaturvedi 2009). Identity conscious beliefs that are
specific (Cox and Blake 1991), and clearly set standards for
procedures and distribution (Roberson and Stevens 2006;
Wu and Chaturvedi 2009) ensure clear understanding by
all, and allows a positive diversity climate to develop
(Kidder et al. 2004). Clear communication reduces the
uncertainty of why any individual was hired or promoted in
the organization. Otherwise, ‘‘cosmetic diversity activities’’
can actually cause greater hostility and intergroup pro-
cesses (Kossek and Zonia 1993). Consequently, excessive
or inadequate diversity management would trigger threats
to diversity identity and legitimacy because of poor pro-
cedural and distributive justice mechanisms.
Conclusion, Implications, and Future Research
Organizations today strive for a continuous identity that is
adaptive and responsive to its stakeholders. This means that
the overall identity is fluid in its interpretation as each
individual puts more weight on different issues thus pro-
ducing various views (Gioia et al. 2000; Holzinger and
Dhalla 2007). Hence, with the development of a more
reflexive and interactive identity comes the notion of mul-
tiple identities (Gioia et al. 2000) in which organizations try
to portray different identities that are relevant such as those
related to diversity aspects. The shared vision among par-
ticular groups may allow for organizations to better target
groups by emphasizing similar shared visions. As the formal
incorporation of diversity in the organization’s identity
becomes the norm, organizations must not fixate on the
notion that increased focus on diversity equates to increased
organizational outcomes such as legitimacy. Our argument
has been for the balance of the multiple identities, and we
caution against organizational practices that excessively
promote diversity to the point of isolating and evoking
retaliation by employees who adhere to other identities.
Likewise, an under emphasis of diversity identity can be
threatening to minorities and result in a threat to internal
legitimacy and diversity identity within the organization. A
reasonable and genuine commitment to diversity-based
values that is mindful of others will result in organizational
practices that cause favorable organizational outcomes.
Theoretically, we relied on institutional theory, specifically
legitimacy, to construct our model and propositions. This
article makes a contribution by introducing diversity identity
as a valid topic for research in the domain of diversity man-
agement. Our novel approach suggests dangerous counter
effects of both inadequate and excessive diversity identity
management. As such, we introduce the need to balance
diversity identity with other organizational identity compo-
nents to ensure harmony, reduce threats to legitimacy, and
promote diversity identity within organizations. While mak-
ing the above argument, we introduce briefly the importance
of congruence and decoupling, as well as social exchange and
justice, thereby introducing additional mechanisms to explain
the process from a variety of perspectives.
Many issues remain, which are beyond the scope of this
article, but may still be pertinent to our understanding of
diversity identity, such as how is diversity identity formed,
changed, or eroded, what other factors affect diversity
identity, how do organizations respond to legitimacy threats,
what are the effects of time on diversity identity, etc.
Future research is needed to empirically examine the
consequences of diversity identity management. It would
be interesting to investigate other organizational conse-
quences besides perceptions of legitimacy and diversity
identity, as well as the interaction among the outcomes.
Other avenues to explore would be the informal economy
as well as specific occupations that have an unusually high
or low percentage of minority members such as the pro-
fessional sport and banking industries.
This article has implications for organizations that are in
the process of identity transformation, such as mergers, joint
ventures, and acquisitions where new identities must be
negotiated and created without threatening any employee
identity. From a managerial standpoint, this article sheds
light on the complexity of managing diversity identity within
organizations, and the varied considerations that must be
addressed to ensure positive organizational outcomes. By
unbundling firm responses to diversity, this article also ini-
tiates a more refined understanding of organizational adap-
tation to stakeholder pressures to promote diversity.
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