It usually results in better ideas. Everyone should understand why final decisions are made. It allows employees to trust management intentions, even if their ideas are rejected. Once a decision is made, managers must state the new rules of the game. When people understand what is expected of them, company politics are minimized.
Employees can focus on the job at hand.
Notice that none of these rules sets out to win company harmony or bring peace and justice to the world. It is the merit of ideas, not who comes up with them, which rules. Nor is it democracy in the work place. Fair process pursues the best ideas from whatever the source. And it works.