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    Why Diversity Matters - Odt

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    Kiby Alice
    Diversity has been shown to improve company performance financially. Research by McKinsey found that companies in the top quartile for gender and racial/ethnic diversity are more likely to have financial returns above the industry averages. Specifically, racial/ethnically diverse companies see earnings rise 0.8% for every 10% increase in diversity, while gender diverse companies see earnings rise 3.5% in the UK. However, most companies still fail to achieve demographic diversity that reflects their country's populations and workforces. Greater diversity leads to improved decision making, talent acquisition, customer orientation and employee satisfaction, creating a cycle of increasing returns.

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    Why Diversity Matters - Odt

    Uploaded by

    Kiby Alice
    43 views2 pages
    Diversity has been shown to improve company performance financially. Research by McKinsey found that companies in the top quartile for gender and racial/ethnic diversity are more likely to have financial returns above the industry averages. Specifically, racial/ethnically diverse companies see earnings rise 0.8% for every 10% increase in diversity, while gender diverse companies see earnings rise 3.5% in the UK. However, most companies still fail to achieve demographic diversity that reflects their country's populations and workforces. Greater diversity leads to improved decision making, talent acquisition, customer orientation and employee satisfaction, creating a cycle of increasing returns.

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    Diversity has been shown to improve company performance financially. Research by McKinsey found that companies in the top quartile for gender and racial/ethnic diversity are more likely to have financial returns above the industry averages. Specifically, racial/ethnically diverse companies see earnings rise 0.8% for every 10% increase in diversity, while gender diverse companies see earnings rise 3.5% in the UK. However, most companies still fail to achieve demographic diversity that reflects their country's populations and workforces. Greater diversity leads to improved decision making, talent acquisition, customer orientation and employee satisfaction, creating a cycle of increasing returns.

    Copyright:

    © All Rights Reserved
    Download as ODT, PDF, TXT or read online from Scribd
    Download as odt, pdf, or txt
    43 views2 pages

    Why Diversity Matters - Odt

    Uploaded by

    Kiby Alice
    Diversity has been shown to improve company performance financially. Research by McKinsey found that companies in the top quartile for gender and racial/ethnic diversity are more likely to have financial returns above the industry averages. Specifically, racial/ethnically diverse companies see earnings rise 0.8% for every 10% increase in diversity, while gender diverse companies see earnings rise 3.5% in the UK. However, most companies still fail to achieve demographic diversity that reflects their country's populations and workforces. Greater diversity leads to improved decision making, talent acquisition, customer orientation and employee satisfaction, creating a cycle of increasing returns.

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    © All Rights Reserved
    Download as ODT, PDF, TXT or read online from Scribd
    Download as odt, pdf, or txt
    of 2

    Why diversity matters

    January 2015
    By Dame Vivian Hunt, Dennis Layton, and Sara Prince

    “New research makes it increasingly clear that companies with more diverse workforces
    perform better financially.”
    Diversity has been one of the biggest debates in the economic sector, it is well known
    the fact that being in a group of people that come from different backgrounds is not quite
    easy, there are differences through people as well as ethic differences in each culture.
    As researches have shown, having a more diverse team of people it brings more
    financial success to companies, as well they are able to win top talent and improve customer
    orientation, employee satisfaction, decision making, all of these leading to a virtuous cycle of
    increasing returns.
    As researches have shown, having a more diverse team of people it brings more
    financial success to companies, as well they are able to win top talent and improve customer
    orientation, employee satisfaction, decision making, all of these leading to a virtuous cycle of
    increasing returns.
    Some researches of the McKinsey in the UK and US companies have shown that
    - Companies in the top quartile for racial and ethnic diversity are 35% more likely
    to have financial returns above their respective national industry medians.
    - Companies in the top quartile for gender diversity are 15% more likely to have
    financial returns above their respective national industry medians.
    - Companies in the bottom quartile both for gender and ethnicity and race are
    statistically less likely to achieve above average financial returns than the average
    companies in the data set.
    - In the US there is a linear relationship between racial and ethnic diversity and
    better financial performance: for every 10% increase in racial and ethnic diversity
    on senior executive team, the earnings before interest and taxes rise by 0.8%
    - Racial and ethnic diversity has a stronger impact on financial performance in the
    US than gender diversity perhaps because earlier efforts to increase women’s
    representation in top levels of business have already shown positive results.
    - In the UK, greater gender diversity on the senior executive team corresponded to
    the highest performance uplift in the statistics: for every 10% increase in gender
    diversity, the earnings before interest and taxes rose by 3.5%
    Having a study between UK, US and Brazil, women are more promoted in the
    executive jobs jobs by 16% in US, followed by UK with 12% and 6% in Brazil, remaining
    the underrepresented at the top of corporations globally.
    The UK has a better position in representing diversity, although at a low level, 78% of
    the companies have senior leadership teams that fail to reflect the demographic composition
    of the country’s labour force and population compared with 91% for Brazil and 97% in the
    US.
    The percentages shown by these statistics still remain a work in progress for
    companies to improve themselves, nowadays, more diverse companies and institutions are
    achieving better performance, most organizations including McKinsey must take full
    advantage of the opportunities that diverse leadership teams represent.
    While certain industries perform better on gender diversity and other industries on ethnic
    and racial diversity, no industry or company is in the top quartile on both dimensions. The
    unequal performance of companies in the same industry and the same country implies that
    diversity is a competitive differentiator shifting markets hare towards more diverse
    companies.

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