How organisations perpetuate social and economic inequality

“Institutional myths” of efficiency, meritocracy and globalisation underpin inequality, says Johanna Mair in the Academy of Management Annals.

Hiring, role allocation, promotion, compensation and structuring are five key ways that organisations perpetuate social and economic inequality, find John Matthew Amis of The University of Edinburgh Business School, Johanna Mair, Hertie School Professor of Organization, Strategy and Leadership, and Kamal Munir of the University of Cambridge Judge School of Business in an article published in the Academy of Management Annals.

In “The Organizational Reproduction of Inequality”, published online on 1 November and forthcoming in print, the authors look inside organisations at how their practices support economic and social inequality, in particular as employment in organisations is the most common source of income for most people around the world.

The authors find evidence that social inequality can be traced to organisational practices such as hiring, task assignments, role allocation, promotion and compensation. They also find these practices are grounded in three “highly institutionalised myths” – efficiency, meritocracy and globalisation.

“Efficiency, meritocracy and globalisation are principles that we attribute to effective organising and effective organisations in a modern society,” Mair says. “However in reviewing the extensive body of work on organisational practices, we found these principles often remain false beliefs and in turn underpin why inequality is reproduced through these practices.”

In the paper, the authors draw on research from across the social sciences, looking at economic inequality, the influence of racial discrimination, the connection between social class and disadvantage, the significant pay gap between men and women, and the intersection of gender, class and race in determining privilege.

“In this paper we ask what, how and why inequality is reproduced by the actions of organisations, and how we take for granted their modus operandi,” she says. “This helps to better understand what can be done to break with entrenched systems that perpetuate inequality,” Mair says.

Read the paper here.

More about Johanna Mair

  • Johanna Mair , Professor of Organization, Strategy and Leadership