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The Impact of Human Resource Management on Financial Performance: A Systematic Review in Cooperative Enterprises

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  • Birhanu Daba Chali

    (Faculty of Economics and Business, Doctoral School of Management and Business, University of Debrecen, 4032 Debrecen, Hungary)

  • Vilmos Lakatos

    (Faculty of Economics and Business, Institute of Accounting and Finance, University of Debrecen, 4032 Debrecen, Hungary)

Abstract

This paper presents a systematic review that examines the influence of human resource management (HRM) on financial performance in cooperative enterprises, utilizing the PRISMA approach. To gather relevant resources, we formulated a search strategy using predefined keywords such as “HRM”, “Financial Performance”, and “Cooperative”. After applying the inclusion criteria (full articles, online accessibility, English language, and relevance to the topic), 26 articles were selected for review. The findings of this analysis reveal a positive relationship between HRM practices and financial performance, with HRM driving both efficiency and profitability. High-performing HRM functions enhance employee productivity while ensuring personnel welfare and improving the organizational climate. Modern HRM practices are crucial in increasing employee engagement, fostering innovative cultures, and improving operational efficiency. These practices directly affect financial performance by linking employee engagement with product quality, profitability, and retention. Based on the studies reviewed, this paper contributes significantly to the existing literature and offers key conclusions that can be drawn from the findings.

Suggested Citation

  • Birhanu Daba Chali & Vilmos Lakatos, 2024. "The Impact of Human Resource Management on Financial Performance: A Systematic Review in Cooperative Enterprises," JRFM, MDPI, vol. 17(10), pages 1-13, September.
    • Handle: RePEc:gam:jjrfmx:v:17:y:2024:i:10:p:439-:d:1489324
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    References listed on IDEAS

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    1. Ammar Ahmed & Faiz Muhammad Khuwaja & Noor Ahmed Brohi & Ismail bin Lebai Othman, 2018. "Organizational Factors and Organizational Performance: A Resource-Based view and Social Exchange Theory Viewpoint," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 8(3), pages 579-599, March.
    2. Nopadol Rompho, 2017. "HC and financial performance with two HRM strategies," International Journal of Productivity and Performance Management, Emerald Group Publishing Limited, vol. 66(4), pages 459-478, April.
    3. Mattijs Lambooij & Karin Sanders & Ferry Koster & Marieke Zwiers, 2006. "Human Resource Practices and Organisational Performance: Can the HRM-Performance Linkage be Explained by the Cooperative Behaviours of Employees?," management revue - Socio-Economic Studies, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 17(3), pages 223-240.
    4. Mattijs Lambooij & Karin Sanders & Ferry Koster & Marieke Zwiers, 2006. "Human Resource Practices and Organisational Performance: Can the HRM-Performance Linkage be Explained by the Cooperative Behaviours of Employees?," management revue. Socio-economic Studies, Rainer Hampp Verlag, vol. 17(3), pages 223-240.
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