Right answer lies in diplomacy and conduct (8)
I believe the answer is:
transact
'conduct' is the definition.
(thesaurus)
'right answer lies in diplomacy' is the wordplay.
'right' becomes 'r' (common abbreviation).
'answer' becomes 'ans' (abbreviation for answer).
'lies in' indicates putting letters inside.
'diplomacy' becomes 'tact' (tact can mean diplomacy or sensitivity).
'r'+'ans'='rans'
'rans' going within 'tact' is 'TRANSACT'.
'and' is the link.
(Other definitions for transact that I've seen before include "Conduct business, negotiate" , "Buy or sell" , "Manage" , "Carry out, like business" , "handle" .)