A recent report from McKinsey & Co indicates that diversity in a company’s leadership is not just nice to have, but has a strong relationship to better financial performance. The report finds that companies in the top quartile of gender diversity were 15 percent more likely to have financial returns above the industry average, and companies in the top quartile of racial/ethnic diversity were 30 percent more likely to have such returns. On the other side of the spectrum, the least diverse companies were statistically less likely to perform above the industry average, meaning diverse companies are proving more profitable.
Why does gender diversity seem to have less of an impact? McKinsey’s report suggests that the earlier-begun work to increase women’s participation in the top level of business has already demonstrated some positive results. Whereas, according to this report, racial diversity has not been as strong of a focus for as long, and it is now starting to yield results for the companies who are focused on it.
The issue of diverse workplaces is an important topic for CDFIs, including OBDC (you can watch part of the discussion held at Opportunity Finance Network’s 2014 conference on the topic). To truly be a community lender, OBDC believes it is important that our staff and board have strong cultural competencies and reflect the demographics of our community and clients. We are proud to be leading in this area, with a highly diverse, talented team that can meet the needs of our communities.
What can you do if your company or organization is in need of a transformation? This report suggests that two critical steps. One, have a visible commitment from your leadership team about inclusion and diversity, and, two, address unconscious bias in an articulated transformation program.
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