Human Resource Practices and Organizational Performance in Libyan Oil Companies: The Mediating Effect of an Inclusive Work Environment

Abstract

This study investigates the relationship between human resource practices and organizational performance in Libyan oil companies, with a specific focus on the mediating role of an inclusive work environment. Operating in a complex and resource-intensive sector, oil companies increasingly rely on effective human resource systems to enhance performance while managing workforce diversity and organizational challenges. Using a quantitative, cross-sectional research design, data were collected through a structured questionnaire administered to employees in Libyan oil companies, yielding 380 valid responses. Partial least squares structural equation modeling was employed to evaluate the measurement model, assess structural relationships, and test the proposed mediation framework. The findings reveal that human resource practices have a positive and significant effect on organizational performance and strongly influence the development of an inclusive work environment. The results further demonstrate that an inclusive work environment positively affects organizational performance and partially mediates the relationship between human resource practices and performance outcomes. These findings highlight the importance of embedding inclusive principles within human resource systems to maximize their performance impact. The study contributes to the human resource management and organizational performance literature by providing empirical evidence from the oil and gas sector in a developing country context. From a practical perspective, the results emphasize the need for managers in Libyan oil companies to design and implement human resource practices that promote inclusion as a strategic mechanism for achieving sustainable organizational performance.