DefinePK

Abstract

This study investigates how four elements of formal performance appraisal—perceived fairness, rating accuracy, relationship quality with peers and supervisors, and overall appraisal satisfaction—affect employee performance in Pakistan’s banking sector. Survey data from 293 bankers (34 % women) were analysed using ordinary-least-squares regression. Perceived fairness, accuracy, and satisfaction each showed positive, significant effects on performance, whereas relationship quality did not when the other factors were controlled. These findings highlight that transparent, accurate, and satisfying appraisal systems drive superior performance more than interpersonal rapport alone. For practice, HR managers should prioritise rater-training that embeds procedural justice, data-based accuracy checks, and clear reward communication. Theoretically, the results suggest relationship variables may influence performance only indirectly when robust appraisal mechanisms are in place, warranting longitudinal research with objective metrics to clarify causal pathways.