CLIMATE AS A MEDIATING CONSTRUCT IN THE HRM–PERFORMANCE EQUATION
Essi Saru, Researcher, Turku School of Economics, Finland
Maarit Viljanen, Researcher, D.Sc., Turku School of Economics, Finland

Abstract
In the HRM–performance literature it has been fairly clearly established that HRM does have an effect on company performance. However, the linking mechanisms between the two are still unclear.  Therefore, this paper aims at taking a deeper look at the human factor in the HRM–performance debate. The purpose of this study is to review the vast HRM –performance literature and to find out what is the role of HR-related factors (e.g. organisational climate, fairness, justice) in the HRM–performance equation. We conducted a literature review based on earlier studies on HRM and performance. The idea was to look for articles which explain how HRM and performance are connected. We especially looked for articles that dealt with organizational climate, fairness and justice perceptions. The main result of our review of the most recent studies on HRM and performance is that soft factors in the HRM–performance equation are strongly interrelated and intertwined and understudied as well.
Keywords:  HRM–performance, fairness perceptions, organizational climate, employee wellbeing, literature review