September 29, 2011 — Study after study has shown how gender diversity on top correlates to greater company profits, but this isn't the only argument for why organizations should advance women to senior ranks. It pays to diversify for an array of other reasons too. Here are my Top 5:
#1: More diversity, more innovation. Using a sample of Fortune 500 firms, researchers found a positive relationship between board gender diversity and innovation. They also observed a positive correlation between board racial diversity and both firm reputation and innovation.
#2: More women, fewer problems. Analyzing 201 Norwegian firms, Sabina Nielsen and Catalyzing guest-blogger Morten Huse found that the ratio of women board directors was positively correlated with a decreased level of conflict.
#3: More women, stronger corporate ethics. Every year, Ethisphere recognizes companies that demonstrate "real and sustained ethical leadership within their industries." A study of the companies that make the coveted list found that they had an important factor in common: boards of directors with a high percentage of women.
#4: More women, more effective problem-solving. A study by researchers from MIT, Carnegie Mellon University and Union College found that the number of women in a group of people significantly predicted the ability of the group overall to effectively solve problems.
#5: More women on top, more women in pipeline. Studies by the RAND Corporation and Catalyst, among others, show a clear and positive correlation between the percentage of women board directors in a company’s past and the percentage of women top executives in its future. This suggests that one way to cultivate a healthy pipeline of women is to ensure that gender diversity starts on the top. The more women there—the more women everywhere!