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  • 2019
  • Article
  • Harvard Business Review (website)

When Gender Diversity Makes Firms More Productive

By: Stephen Turban, Dan Wu and Letian Zhang
  • Format:Electronic
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Abstract

Does diversity make a company more productive? Many say yes—some researchers argue that gender diversity leads to more innovative thinking and signals to investors that a company is competently run. Others say no—conflicting research indicates that gender diversity can disrupt social cohesion, making people less likely to collaborate. Most of this research, however, has looked at the question within a single country or industry. Could the conflicting research be due to differences in context? Region and industry might affect people’s opinions of gender diversity, and this might then affect whether or not diversity leads to stronger outcomes. In a recent study of 1069 leading firms across 35 countries and 24 industries, researchers found that gender diversity relates to more productive companies, as measured by market value and revenue, only in contexts where gender diversity is viewed as “normatively” accepted. By normative acceptance, they mean a widespread cultural belief that gender diversity is important. In other words, beliefs about gender diversity create a self-fulfilling cycle. Countries and industries that view gender diversity as important capture benefits from it. While those that don’t, don’t. The researchers outline three main reasons why opinions about the value of diversity matter so much to the actual value it brings. And these may provide lessons for managers who wish to capture the benefits of gender diversity.

Keywords

Gender; Diversity; Performance; Performance Productivity

Citation

Turban, Stephen, Dan Wu, and Letian Zhang. "When Gender Diversity Makes Firms More Productive." Harvard Business Review (website) (February 11, 2019).
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About The Author

Letian Zhang

Organizational Behavior
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More from the Authors
  • Regulatory Spillover and Workplace Racial Inequality By: Letian Zhang
  • Values and Inequality: Prosocial Jobs and the College Wage Premium By: Nathan Wilmers and Letian Zhang
  • A Framework for Understanding Racial Disadvantage within Organizations By: Alexandra C. Feldberg, Letian Zhang and Anthony J. Mayo
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