AI-Based Recruitment Tools and Workforce Diversity in the Banking Sector

This study investigates the impact of AI-based recruitment tools on workforce diversity in the banking sector, with ethical guidelines as a moderating variable. A quantitative approach was adopted, employing Structural Equation Modeling (SEM) through SmartPLS to analyze data collected from 211 professionals working in various banking institutions across Karachi, Pakistan. The findings reveal a significant positive relationship between the adoption of AI-based recruitment tools and workforce diversity, highlighting the transformative potential of technology in enhancing inclusive hiring practices. Moreover, ethical guidelines were found to significantly moderate this relationship, reinforcing the need for transparent and fair AI systems in HR processes. The study contributes to the growing literature on AI in Human Resource Management (HRM), providing empirical evidence from a developing country context. It further offers practical implications for HR professionals and policymakers aiming to integrate ethical AI into recruitment systems to foster diversity and inclusion.