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> Profitability is, of course, necessary to keep any business alive, and studies show that racial, ethnic, and gender diversity contribute to business success.

> Profitability is, of course, necessary to keep any business alive, and studies show that racial, ethnic, and gender diversity contribute to business success. A McKinsey & Company study of 366 companies revealed a statistically significant connection between diversity and financial performance. The companies in the top quartile for gender diversity were 15% more likely to have financial returns that were above their national industry median, and the companies in the top quartile for racial/ethnic diversity were 35% more likely to have financial returns above their national industry median. https://www.nspe.org/resources/pe-magazine/july-2020/why-should-i-care-about-diversity-engineering https://www.nspe.org/resources/pe-magazine/july-2020/why-sho...

t-3 5y ago
Cynically, couldn't these results be due to lower average wages offered to women and minorities?
rurp 5y ago
Are there any studies demonstrating causality? I can think of plenty of reasons diversity would correlate with success. For example, being based in a large city will have a lot of advantages for many businesses, along with having a more diverse hiring pool available that will naturally lead to a more diverse staff. But this doesn't suggest to me that adding a diversity quota or similar policy, all else being equal, will help a company succeed.
jlawson 5y ago
Confounded by the fact that succesful companies are located in growing areas (or move there), which is where immigrants also want to go. E.g. San Francisco. I want to see this with some serious attempt to reduce the confounding. Also it doesn't demonstrate cause and effect as stated in the quote. It's perfectly possible in this data that diversity makes companies less successful - but being successful in the first place is what creates the 'slack' that leads to a company pursuing diversity policies. They only go diversity when they can afford the cost incurred.
bradleyjg 5y ago
Would the study have been published if it came out the other way? If not, you have a form of inadvertent p hacking.

t-3 5y ago

Cynically, couldn't these results be due to lower average wages offered to women and minorities?

rurp 5y ago

Are there any studies demonstrating causality? I can think of plenty of reasons diversity would correlate with success. For example, being based in a large city will have a lot of advantages for many businesses, along with having a more diverse hiring pool available that will naturally lead to a more diverse staff. But this doesn't suggest to me that adding a diversity quota or similar policy, all else being equal, will help a company succeed.

jlawson 5y ago

Confounded by the fact that succesful companies are located in growing areas (or move there), which is where immigrants also want to go. E.g. San Francisco. I want to see this with some serious attempt to reduce the confounding. Also it doesn't demonstrate cause and effect as stated in the quote. It's perfectly possible in this data that diversity makes companies less successful - but being successful in the first place is what creates the 'slack' that leads to a company pursuing diversity policies. They only go diversity when they can afford the cost incurred.

bradleyjg 5y ago

Would the study have been published if it came out the other way? If not, you have a form of inadvertent p hacking.