Our ground-breaking Diversity Matters report shows a significant link between corporate performance and the gender and ethnic diversity of company leadership. Fittingly, the team behind the study—London-based partners Vivian Hunt and Dennis Layton, and Atlanta-based partner Sara Prince—brought an incredibly diverse set of personal experiences and professional interests to the research.
Recalls Sara: "When I first started work, as a 20-something year old on a Wall Street trading floor, I was the only person who looked like me." The experience sparked an interest in organizational dynamics that later led her to McKinsey. "As a black female in America, I fundamentally believe in equal opportunity, at an inherently moral level. But I started to really question what is the business value of diversity and how do you actually achieve it?"
These are the questions that Diversity Matters starts to address.
A sociologist by training (and former military cryptographer), Dennis leads our Organization work in London and has a deep interest in how management practices effect organizational performance. Among his previous research interests: contributing to an international study of the impact of hospital management practices on clinical outcomes. Bringing that same level of cross-border, fact-based rigor to questions of management diversity was a natural fit.
Dennis, who is also a leader of Equal at McKinsey, our LGBTQ affinity group, points to some intriguing details among the data. For example, in the US the impact on financial performance of increasing racial diversity was stronger than the impact of increasing gender diversity, whereas the inverse was true in the UK. "Hopefully we will get people to reflect on what is going in terms of how the dynamics are playing out in their countries. The performance numbers are really a proxy for decision biases and blind spots," he says.
For Vivian, the research was a chance to further shape the diversity debate, building on the impact of our ongoing Women Matter research, which focuses on gender. As the leader of our London office, she also understands the need to "walk the walk" on diversity, keeping a check on her own biases. "The challenge," says Vivian, "is to manage bias by making the unconscious conscious. Similar to the adage that you can't manage what you don't measure, you can't change what you don't acknowledge."
She adds: "The single most important thing we want people to take away from this report is that greater diversity on boards and top executive teams helps deliver positive economic performance and organizational health. This is a great breakthrough. For a long time—too long, perhaps—the debate around diversity has lacked economic weight. Hopefully, we've started to reshape the discussion in a meaningful and global way."
Many companies are eager to start the process. Says Sara: "One of the things that has been interesting to me in this journey is that while the clients that we talked to at the beginning were excited to understand if there was a relationship between diversity and performance, they were even more hungry to understand how to actually achieve it."
The team is already planning additional research exploring the impact of other types of diversity, in more areas around the world—and the best ways for companies to achieve diversity in a meaningful way.