In today’s competitive and dynamic organizational environment, human capital plays a pivotal role in ensuring sustainable performance and growth. This study investigates the impact of Human Resources (HR) audits and employee engagement on employee performance within corporate organizations. HR audits, when systematically executed, ensure that HR policies, practices, and strategies align with organizational goals and legal compliance, creating an enabling environment for performance enhancement. Simultaneously, employee engagement—reflecting the emotional commitment and involvement of employees—has been widely acknowledged as a key driver of individual and organizational productivity. The research adopts a mixed-methods approach combining structured questionnaires and semi-structured interviews, targeting employees and HR professionals across various sectors. Quantitative data were analyzed using regression and path analysis techniques, while qualitative insights supplemented contextual understanding. Findings reveal that both HR audits and employee engagement significantly and positively influence employee performance, with engagement serving as a partial mediator in the relationship between HR audits and performance outcomes. The study underscores the necessity of institutionalizing regular HR audits alongside cultivating a culture of engagement to foster optimal employee outcomes. Practical implications for HR managers, policymakers, and organizational leaders are discussed, along with directions for future research in this domain.