• Fri. Mar 1st, 2024

Uncovering the Truth: Separating Fact from Fiction in Studies of Diversity and Company Performance

ByEditor

Feb 11, 2024
Does diversity truly benefit business?

In many cases, it is possible to manipulate studies to present a more favorable outcome. While some research has found a correlation between diversity and company performance, it is important to note that these correlations are often not definitive. A McKinsey report claimed a strong link between diversity and earnings before interest and tax (EBIT) using a specific methodology. However, a more accurate measure of performance for investors is total shareholder return (TSR), as this is what they ultimately receive from investing in a company. It’s crucial to approach claims of diversity with critical thinking and not blindly accept them without thoroughly examining the evidence.

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