The diplomacy in RoR is almost identical to the way the diplomacy works in SW: Rebellion. A planets population reacts to events in the galaxy an within the sector. Victories and defeats, planet conversion and others push on the slowly process of convergency with one site of the conflict. Which eventually leads to the joining of the planet to you or to your enemy. Or the planet becomes independent.
There are uninhabitated and inhabited planets. Inhabited planets sympathize either with the Rebel Alliance or with the Galactic Empire or are neutral. Characters with diplomatic skills (e.g. Mon Mothma) influence the minds of the planet inhabitants. This works on neutral and own planets. To persuade enemy planets other skills are needed.