February 17: The benefits of diversity

Companies with more diverse leadership teams are more likely to outperform financially.

Source: McKinsey
Published: January 2018

The benefits of diversity

Companies with more diverse leadership teams are more likely to outperform financially. A recent McKinsey study of 1,007 companies in 12 countries placed them into quartiles for gender and ethnic diversity. Companies in the 1st quartile for gender diversity were 21% more likely to outperform on profitability than those in the 4th quartile, while companies in the first quartile for ethnic diversity were 33% more likely to outperform those in the 4th.

The chart below shows the financial performance above national industry median. If diversity had no effect, all quartiles would have a 50% likelihood to outperform. 

Gender Diversity
4th Quartile (Least Diverse): 45%
1st Quartile (Most Diverse): 55%
Diversity Boost (to financial performance): +21%

Ethnic Diversity
4th Quartile (Least Diverse): 44%
1st Quartile (Most Diverse): 59%
Diversity Boost (to financial performance): +33%

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