A McKinsey Report: Delivering through Diversity
McKinsey, the consulting company, just published its latest study of diversity in the workplace, Delivering through diversity. The report reaffirms the global relevance of the link between diversity—defined as a greater proportion of women and a more mixed ethnic and cultural composition in the leadership of large companies—and company financial outperformance.
The new analysis expands on the company’s 2015 report, Why diversity matters. The 2018 report draws on an enlarged data set of more than 1,000 companies covering 12 countries, measuring profitability (in terms of earnings before interest and taxes, or EBIT) and longer-term value creation (or economic profit).
The report also explores diversity at different levels of the organization, considering a broader understanding of diversity (beyond gender and ethnicity), and providing insight into best practices.
Gender diversity is correlated with both profitability and value creation.
Executive teams of outperforming companies have more women in line roles versus staff roles.
Top-team ethnic and cultural diversity is correlated with profitability.
McKinsey discovered through its research that the companies in its survey all developed inclusion and diversity (I&D) strategies that reflected their business ethos and priorities, ones that they were strongly committed to. Four imperatives emerged as being crucial:
Articulate and cascade CEO commitment to galvanize the organization.
Define inclusion and diversity priorities that are based on the drivers of the business-growth strategy.
Craft a targeted portfolio of inclusion and diversity initiatives to transform the organization.
Tailor the strategy to maximize local impact.
Download the full report: Delivering through diversity.