Investing in Diversity Climate Can Help Organizations Retain High Performers and Promote Meritocracy

Abstract: Critics of organizational diversity initiatives often argue that such efforts undermine meritocracy. We challenge this view by examining whether investments in diversity climate can, in fact, support meritocratic outcomes by helping organizations retain their highest-performing employees. Prior research demonstrates a strong association between positive diversity climate perceptions and lower employee turnover intentions. Building on this work, we test whether this relationship is especially pronounced among top performers—those employees organizations should most seek to retain. Across a field study (N=12,865 employees) and a preregistered online vignette experiment (N=600), we find that perceptions of a positive diversity climate are associated with stronger intentions to remain with an organization. Importantly, this effect is significantly stronger for the highest-performing employees. These findings suggest that diversity investments may yield positive spillover effects by enhancing retention of top talent, thereby strengthening rather than weakening meritocratic outcomes within organizations.

Keywords: diversity climate, meritocracy, turnover, retention, high performance