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ISSN No. 2321-2705 | DOI: 10.51244/IJRSI | Volume XII Issue VIII August 2025
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An Impact of Organisational Climate on Employees’ Performance
with Select Private Insurance Companies
Dr. V. S. Rajakrishnan, *P. Aruldevi
Bharathidasan University, Karaikal, Tamil Nadu, India
DOI: https://doi.org/10.51244/IJRSI.2025.120800150
Received: 22 August 2025; Accepted: 31 August 2025; Published: 16 September 2025
INTRODUCTION OF THE STUDY
Organizational Climate is comprised of a mixture of norms, values, expectations, policies and procedures that
influence work motivation, commitment and ultimately individual or work unit performance. Climate can be
defined as the perceived attributes of an organization and its subsystems, as reflected in the way an organization
deals with its members, groups and issues. The Emphasis is on perceived attributes and the working of
subsystems. Positive Climate encourages, while negative climate inhibits discretionary effort. ‘Organizational
Climate’ refers to the quality of working environment. If people feel that they are valued and respected within
the organization, they are more likely to contribute positively to the achievement of business outcomes. Creating
a ‘healthy’ organizational climate requires attention to the factors which influence employees’ perceptions,
including the quality of leadership, the way in which decisions are made and whether the efforts of employees
are recognized. Organisational climate influences to a great extent the performance of the employees because it
has a major impact on motivation and job satisfaction of individual employees. Organisational climate
determines the work environment in which the employee feels satisfied or dissatisfied. Since satisfaction
determines or influences the efficiency of the employees, we can say that organisational climate is directly
related to the efficiency and performance of the employees.
REVIEW OF LITERATURE
Many research studies have been conducted on the subject of organizational climate and job satisfaction in
respective areas. These studies have revealed that certain variables are consistently correlated with
organizational climate and job satisfaction in private insurance sector. This segment presents a brief review of
earlier literature relevant to the study of “An Impact of Organisational Climate on Employees’ Performance with
Select Private Insurance Companies”. The collection of reviews has been made from various studies undertaken
by academic journals, magazines, publication, working papers, books and the like.
*Associate Professor in Commerce, E.G.S. Pillay Arts & Science College, (Autonomous), Affiliated to
Bharathidasan University, Nagapattinam 611 002, Tamil Nadu, India.
** Ref. No. 16023/Ph.D K6/Commerce/Part-time/Oct 2017, Research Scholar, Department of Commerce, Don
Bosco College (Arts & Science), Thamanangudy, Ambagarathur, Karaikal 600 601, Puducherry (U.T)
Vijayakumar, Nishad Nawaz and et.al (2020), stated that the “HRD Practices Impact on Organizational Climate
of Insurance Sector, The study aims to understand the impact of HRD practices towards the organizational
climate in Life Insurance Sector. The data collected by using both methods primary & secondary data, the study
conducted in the Chennai city & circulated 400 questionnaires distribution, 371 filled questionnaires returned in
that 189 samples from the public sector insurers, i.e., LIC and 188 samples collected from the select private
sector life insurers, i.e., ICICI prudential, HDFC, and SBI Life from sales employees namely, development
officer, marketing executives, executive sales managers, assistant managers, and sales manager in sales. This
study used statistical tools namely percentage analysis, independent t-test and Regression analysis. The study
results also identified that there is a significant impact of HRD practices towards the organizational climate in
the insurance sector in the study region. The study was conducted in the area of Chennai city and data collected
INTERNATIONAL JOURNAL OF RESEARCH AND SCIENTIFIC INNOVATION (IJRSI)
ISSN No. 2321-2705 | DOI: 10.51244/IJRSI | Volume XII Issue VIII August 2025
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from selected organizations. The study can be extended by taking more sample size, other similar organizations
within the Chennai and the same study can be possible in whole Tamil Nadu. The researchers can extend the
study in other states of India, it also possible to conduct comparative study in between the organizations, states
of India and similar studies can be possible in other countries as well.
Toopalli Sirisha and Y.P. Sai Lakshmi (2022), stated that “A Study on Organisational Climate and Its Impact on
Employees Performance in Tamil Nadu”, This article aim is to study the climate of the organisation and its
impact on employee’s performance. The employee performance is mostly depending upon the environment that
prevailed in each organisation for instance positive encouragement and motivation at organisation leads to
positive performance at organisation, negative climate leads to slow performance at organisation level. The
satisfaction with organizational climate positively affects the performance and has negative relationship with
turnover and deviant behaviour of the employees at work. This article intended to assess the organizational
climate and its impact on employee’s performance. This study also investigated the level of climate which
influences the employee’s performance. Positive or Negative climate prevailing in the organization are predicted
and analysis are carried out. To achieve this defined objective questionnaire is prepared. The prepared
questionnaire is used to get the direct responses from eighty employees. The responses given by the employees
are analyzed and interpreted using the different type of statistical tools like Correlation, Chi-square and ANOVA.
Employees are the main asset of organizations for delivering services. A work environment should be created
where employees feel appreciated for their efforts.
Problem That Has Been Focused on the Study
In the present study, the researcher wants to know whether select insurance companies to properly maintain the
HRM practices under organizational climate, such as Preparation of HR Plans, Developing HR Policies, HR
development system, appraisal system, integrating people with the organization, maintaining employee welfare
and social programs etc., By conducting this study, the researcher will be able to provide better insight into how
the private insurance companies are improving their HRM practices and services for better organizational
climate maintenance. With this backdrop the researcher has made an attempt to analyze the “An Impact of
Organisational Climate on Employees’ Performance with Select Private Insurance Companies”. Hence, the
researcher wants to know the answers for the following research questions:
What is the impact of Organisational Climate on Employees’ Performance to the select insurance companies in
the Karaikal district?
Research Objectives
To analyse the impact of Organisational Climate on Employees’ Performance to the select insurance companies
in the Karaikal district.
To offer implications and conclusion of the study
Research Hypothesis
H
01
= There is no relationship of Organisational Climate on Employees’ Performance to the select insurance
companies in the Karaikal district.
H
02
= There is no impact of Organisational Climate on Employees Performance to the select insurance
companies in the Karaikal district.
METHODOLOGY AND TOOLS
Sources of data
The study is based on the primary. The primary data was collected for the period of 3months from 1
st
August,
2023 to 30
th
August, 2023 on interview schedule method. In addition, other required data was collected from
various journals, magazines, newspapers, website, unpublished thesis work and reports.
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Techniques of Analysis
The collected data have been used for analysis with the help of statistical tools. The statistical techniques
Correlation and Regression analysis.
Sampling Design
The primary data for the study has been collected from a sample population of 117 respondents based on
purposive sampling method, using a well-structured interview schedule. The data have been collected from the
employee’s working in different private insurance sectors/companies in Karaikal district. The sample size of 117
is determined by the total population of the Karaikal district.
Table 1 Sampling Insurance Companies Consider for the Study
S. No
Insurance Companies
Sample Size
1
Aditya Birla Sun life Insurance Co. Ltd.
30
2
Bajaj Allianz Life Insurance Co. Ltd.
30
3
HDFC Life Insurance Co. Ltd
30
4
ICICI Prudential Life Insurance Co. Ltd
30
5
SBI Life Insurance Co. Ltd.
30
Total
150
Source: https://financialservices.gov.in/life-insurance-companies
Table 2 exhibits the correlation analysis of Gender and Employees’ Performance to the select insurance
companies in the Karaikal district.
Ho
1
(a): There is no relationship of Organisational Climate on Employees’ Performance
to the select insurance companies in the Karaikal district
Table 2 Correlation Analysis of Gender and Employees’ Performance to The Select Insurance Companies in
The Karaikal District
LP
RW
OS
WE
RG
DM
LP
1
RW
.936
**
1
OS
.304
.539
1
WE
-.654
*
-.856
**
-.722
*
1
RG
.470
.188
-.426
.249
1
DM
-.322
-.586
-.640
*
.807
**
.359
1
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Note: Leadership (LP), Rewards (RW), Organisational Structure (OS), Working Environment (WE),
Recognition (RG) and Decision making (DM)
*. Correlation is significant at the 0.05 level (2-tailed). **. Correlation is significant at the 0.01 level (2-tailed).
Table 2 reveals the Correlation Analysis of Gender and Employees’ Performance to the select insurance
companies in the Karaikal district. The positive correlation was observed between the leadership and rewards
(.936), working environment and decision-making (.807) are significant at 1 per cent level. The negative
correlation was observed between leadership and working environment (.654), rewards (.722) is significant at 1
per cent level. The rewards and working environment (.856) are significant at 5 per cent level.
Table 5.7 exhibits the Regression and ANOVA analysis of Gender and Employees’ Performance to the select
insurance companies in the Karaikal district.
Ho
2
(a): There is no impact of Organisational Climate on Employees’ Performance to the
select insurance companies in the Karaikal district
Table 3 Regression Analysis of Organisational Climate on Employees’ Performance to the select insurance
companies in the Karaikal district
Model Summary
b
Model
R
R
Square
Adjusted R
Square
Std. Error of
the Estimate
Durbin-
Watson
1
.902
a
.813
.579
66.44469
2.481
Predictors: (Constant), Leadership (LP), Rewards (RW), Organisational Structure (OS), Working
Environment (WE), Recognition (RG) and Decision making (DM) Dependent Variable: Gender
Table 3 represents the multiple regression analysis of Gender and Employees
Performance to the select insurance companies in the Karaikal district. The R
2
value at .813 states that all the six
independent variables that is Leadership (LP), Rewards (RW), Organisational Structure (OS), Working
Environment (WE), Recognition (RG) and Decision making (DM) have 81 per cent influence on the dependent
variable. Hence there is a significant impact on Gender and Organisational climate factors among the Employees
Performance to the select insurance companies in the Karaikal district. The Durban-Watson statistics value of
2.481 indicates the negative autocorrelation among the independent variables.
Table 5.9 exhibits the correlation analysis of Powerica Ltd. during the study period from 2011-2012 to 2020-
2021. Ho
1
(b): There is no significant relationship between the liquidity ratios and capital
among the Powerica Ltd
Table 5.9 Correlation Analysis of Powerica Ltd
CR
LR
ITR
DTR
WTR
CAP
CR
Pearson
Correlation
1
LR
Pearson
Correlation
.924
**
1
ITR
Pearson
Correlation
-.130
.048
1
DTR
Pearson
Correlation
.563
.300
-.348
1
INTERNATIONAL JOURNAL OF RESEARCH AND SCIENTIFIC INNOVATION (IJRSI)
ISSN No. 2321-2705 | DOI: 10.51244/IJRSI | Volume XII Issue VIII August 2025
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WTR
Pearson
Correlation
-.501
-.433
.121
-.102
1
CAP
Pearson
Correlation
-.369
-.242
.687
*
-.547
.276
1
*. Correlation is significant at the 0.05 level (2-tailed).
**. Correlation is significant at the 0.01 level (2-tailed).
Table 5.9 shows the Correlation Analysis of Powerica Ltd from 2011-2012 to 20202021. The positive correlation
was observed between the liquidity ratio and current ratio (.924) are significant at 1 per cent level. The capital
and inventory turnover ratio (.687) are significant at 5 per cent level.
Table 5.10 exhibits the Regression and ANOVA analysis of Powerica Ltd. during the study period from 2011-
2012 to 2020-2021.
Ho
2
(b): There is no significant impact on capital and liquidity ratios among the
Powerica Ltd
Table 5.10 Regression Analysis of Powerica Ltd
Model Summary
b
Model
R
R
Square
Adjusted R
Square
Std. Error of
the Estimate
Durbin-
Watson
1
.830
a
.688
.299
4.04167
1.645
Predictors: (Constant), Current Ratio, Liquid Ratio, Inventory Turnover Ratio, Debtors Turnover Ratio and
Working Capital Turnover Ratio Dependent Variable: Capital
Table 5.10 revels the multiple regression analysis of Powerica Ltd. The R
2
value at .688 states that all the five
independent variables that is Current Ratio, Liquid Ratio, Inventory Turnover Ratio, Debtor’s Turnover Ratio,
Working Capital Turnover Ratio, Capital have 68 per cent influence on the dependent variable of Capital which
is significant at 5 per cent level. So, the null hypothesis is rejected and hence there is a significant impact on
capital and liquidity ratios among the Powerica Ltd. The Durban-Watson statistics value of 1.645 indicates the
positive autocorrelation among the independent variables.
Table 5.11 ANOVA of Powerica Ltd
Model
Sum of
Squares
df
Mean
Square
F
Sig.
1
Regression
144.397
5
28.879
1.768
.300
b
Residual
65.340
4
16.335
Total
209.737
9
Predictors: (Constant), Current Ratio, Liquid Ratio, Inventory Turnover Ratio, Debtors Turnover
Ratio and Working Capital Turnover Ratio Dependent Variable: Capital
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Table 5.11 revels that the ANOVA of Powerica Ltd. Calculated F value of the variable is 1.768 which are less
than the table value of 2.368 at 5 per cent significant level. Hence, the hypothesis is accepted. That means that
there is a significant relationship between liquidity ratios.
Table 5.12 exhibits the correlation analysis of Sudhir Power Ltd. during the study period from 2011-2012 to
2020-2021.
Ho
1
(c): There is no significant relationship between the liquidity ratios and capital among the Sudhir Power Ltd
Table 5.12 Correlation Analysis of Sudhir Power Ltd
CR
LR
ITR
DTR
WTR
CAP
CR
Pearson
Correlation
1
LR
Pearson
Correlation
.977
**
1
ITR
Pearson
Correlation
.371
.486
1
DTR
Pearson
Correlation
.121
-.065
-.233
1
WTR
Pearson
Correlation
-.208
-.395
-.375
.806
**
1
CAP
Pearson
Correlation
-.089
-.178
-.282
.633
*
.261
1
*. Correlation is significant at the 0.05 level (2-tailed).
**. Correlation is significant at the 0.01 level (2-tailed).
Table 5.12 depicts the Correlation Analysis of Sudhir Power Ltd from 2011-2012 to 2020-2021. The positive
correlation was observed between the liquid ratio and current ratio (.977), working capital turnover ratio and
debtor’s turnover ratio (.806) are significant at 1 per cent level. The capital and debtor’s turnover ratio (.633) are
significant at 5 per cent level.
Table 5.13 exhibits the correlation analysis of Sudhir Power Ltd. during the study period from 2011-2012 to
2020-2021.
Ho
1
(c): There is no significant relationship between the liquidity ratios and capital among the Sudhir Power Ltd
Table 5.13 Correlation Analysis of Sudhir Power Ltd
Model Summary
b
Model
R
R
Square
Adjusted R
Square
Std. Error of
the Estimate
Durbin-
Watson
1
.916
a
.839
.637
49.53082
2.791
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Predictors: (Constant), Current Ratio, Liquid Ratio, Inventory Turnover Ratio, Debtors Turnover Ratio and
Working Capital Turnover Ratio Dependent Variable: Capital
Table 5.13 depicts the multiple regression analysis of Sudhir Power Ltd. The R
2
value at .839 states that all the
five independent variables that is Current Ratio, Liquid Ratio, Inventory Turnover Ratio, Debtor’s Turnover
Ratio, Working Capital Turnover Ratio, Capital have 83 per cent influence on the dependent variable of Capital
which is significant at 5 per cent level. So, the null hypothesis is rejected and hence there is a significant impact
on capital and liquidity ratios among the Sudhir Power Ltd. The Durban-Watson statistics value of 1.645
indicates the negative autocorrelation among the independent variables.
Table 5.14 ANOVA of Sudhir Power Ltd
Model
Sum of
Squares
df
Mean
Square
F
Sig.
1
Regression
51003.398
5
10200.680
4.158
.096
b
Residual
9813.210
4
2453.302
Total
60816.608
9
Predictors: (Constant), Current Ratio, Liquid Ratio, Inventory Turnover Ratio, Debtors Turnover
Ratio and Working Capital Turnover Ratio Dependent Variable: Capital
Table 5.14 depicts that the ANOVA of Sudhir Power Ltd. Calculated F value of the variable is 4.158 which
are more than the table value of 2.368 at 5 per cent significant level. Hence, the hypothesis is rejected. That
means that there is a significant relationship between liquidity ratios.
Policy for Implications of the study
The following implications are outcome of the analysis Objective 4: To offer implications and conclusion of
the study
It was found with the help of percentage analysis that all the respondents had sensible knowledge about
organizational climate in job satisfaction among employees of insurance companies in Karaikal district.
Therefore, the insurance companies and IRDA are promoting the employees/workers through various monetary
and non- monetary benefits. This will help to increase the satisfaction of the employees/workers.
To increase an optimum productivity from the employees/workers the insurance companies and dealers should
ensure promotion, bonus and incentives to the employees/workers.
Frequent review of the employees/workers issues may help the management to mitigate on short-term issues.
Conclusion of the study
The climate that emerges within an organization becomes the major contributing factor of employee behaviour.
Since the climate perception influences efficiency of employees. A sound climate is a long-run scheme.
Organizational climate is becoming more important than ever before because organizations need to ensure that
those individuals who add value should stay in the organization and continue to put their efforts into their work
to benefit the organization. The few factors are positive from the study that is Gender and Age wise
employees/workers are satisfied but, in monthly income wise they are not much more satisfied. So, the insurance
companies must concentrate on bonus, increment and other monetary benefits to the employees/workers to
promote their scale of business and employable sustainability.
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