The Reds squad made the gesture ahead of their goalless draw at Wigan Athletic in December 2011 after Suárez was banned for eight games by the FA for racially abusing Manchester United’s Patrice Evra.
“I didn’t send them out in the t-shirts,” Dalglish told talkSPORT.
“The boys decided that themselves. You can’t tell me they wouldn’t have done that if they didn’t believe in him and didn’t have respect for him.
“It might not have been right, but it wasn’t me that decided it.
“A lot of things are misinterpreted and misrepresented. I was brought up to be respectful and tell the truth, and what I believed to be the truth is what I said. I can’t be any different in that.”
Liverpool came in for criticism after issuing their own strongly-worded statement in response to the ban, with the players also making their own declaration in support of the Uruguay international.
And Dalglish admitted that if the situation presented itself again, he would handle things differently.
“I would do things differently,” he added. “I would be less helpful and less forthcoming and that’s sad. There’s no place for racism in football in any way, shape or form.”
With the issue of racism in football currently in the spotlight, Dalglish believes the FA and the justice system must adopt the same laws if the sport is to eradicate the problem.
“The FA have got a responsibility to try to clear it up [racism]. It [this country] is as good as any country in the world, and probably better than most, and there is fantastic support here to get it cleared up.
“But if they want to clear it up they’ve got to get closer to the laws of the land. You can’t go to an FA tribunal where you are judged on the basis of probability and then go to a court of the land and you are judged beyond reasonable doubt.
“They’ve got to be closer to the law of the land and make sure the tribunal is independent and that you don’t get different degrees of punishment simply because there are different people with different interpretations. Why not have the same panel?”
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