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  1. Blog
  2. Quick Hits
  3. February 13, 2019

A Country’s Opinion on Gender Diversity Impacts Company Performance

By InHerSight

There’s a lot of research out there suggesting that gender diversity is one of the best things a company can do to increase performance—but there’s also research that shows the opposite. To find out once and for all how diversity impacts firms, Harvard Business School Professor Letian (LT) Zhang conducted a study to look at the context. The study found that the relationship between a company's market value or revenue and its stance on gender diversity is more complicated than the public narrative suggests.

The study, which looked at 1,069 of the top firms in 35 countries across 24 industries,  found that gender diversity leads to more productive companies only when gender diversity is regarded as an important priority. Essentially, a successful company is one whose diversity policy reflects its environment's status quo.

Take Western Europe and Japan for example. Since Western Europe has historically stressed the importance of diversity, it shows in performance—the percentage of women in telecommunication companies is significantly related to a company’s market value. On the other hand, Japan has historically held very patriarchal customs in the workplace, so companies there don’t benefit as much from diversity.

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