Research shows that appointing women and people of color to senior positions leads to greater innovation, higher profits and better governance.Â
For more than a decade, we have examined the impact of representation among senior leaders — on the board and in the C-suite — on organizational performance. How does appointing white women as well as men and women of color to senior leadership roles change how organizations do business? Â
We define performance expansively to include a range of outcomes that stakeholders care about: innovation, product strength, community relations, equity and diversity records, environmental sustainability and governance.Â
Our findings are clear: more inclusive organizations are more innovative, more profitable, more equitable, more sustainable, better governed and enjoy stronger relationships with their communities and suppliers. Â
By contrast, firms that fail to prioritize inclusion and equity pay a high cost. They suffer from lower job…