The role of psychological safety, communication climate, and employee engagement in preventing formal industrial disputes
DOI:
https://doi.org/10.66635/mgnfb585Keywords:
Sustainable Entrepreneurship, SMEs in Emerging Economies, Psychological Safety, Employee Engagement, Organizational SustainabilityAbstract
This study examines how workplace-level organizational dynamics contribute to sustainable entrepreneurship and enterprise resilience in emerging economies, with specific focus on Indian manufacturing SMEs. Drawing on theories of psychological safety, employee engagement, and communication climate, the research explores how these internal factors influence the escalation of workplace grievances into formal industrial disputes and, in turn, affect long-term organizational sustainability. Adopting a mixed-methods approach, qualitative insights from interviews and focus groups with employees, supervisors, and union representatives informed the development of context-specific measures, which were subsequently tested through a survey of manufacturing employees. The findings reveal that psychological safety and a supportive communication climate significantly enhance employee engagement and reduce the likelihood of conflict escalation. Importantly, these workplace conditions foster trust, collaboration, and efficient conflict resolution, thereby strengthening firm-level stability, productivity, and sustainable growth. By positioning workplace climate as a strategic organizational capability, this study contributes to the literature on sustainable entrepreneurship by demonstrating how internal relational dynamics support resilience and value creation in SME contexts. The results also highlight the importance of inclusive and participatory management practices in shaping sustainable enterprise outcomes in Asia’s emerging economies. The study offers practical implications for entrepreneurs, managers, and policymakers seeking to promote sustainable, inclusive, and conflict-resilient business environments.
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