Diversity Economics Research – “The profit impact of organisational gender Diversity programs”

Equality and Equity for all people is important to me, particularly in terms of gender diversity and women in leadership.  Women make up at least half, if not more than half, of the population in most countries. They are the back bone of support structures in most situations (some without choice), are the target of marketers of consumer products, and yet they do not have full representation at executive manager and board level in most organisations.

It is imperative that women claim their voice, as equal citizens, as company directors and policy makers to shape a future for our children that is inclusive and not exclusive.  Gender diversity is here,  and is rightfully being recognised as a way to improve economic outcomes by tapping into creativity, innovation and a thinking pattern outside the norm.   Gender diversity programs offer organisations a mechanism to reach female resources that are often hidden in supporting roles within organisations, where they support strategy instead of making strategy.

Women the world over should have the choice of inputting directly into our economic future as decision makers and leaders, and should not be restricted to indirectly impacting the economy by being consumers and supporters, or worse being seen as a ‘burden’ and an ‘economic cost’.  The roles of parenting and care are not barriers and economic burdens if we value them, but we still have issues in these areas, with the burden of childcare still falling to many women and creating perceived barriers to  their career advancement.  That means that diversity programs need to recognise the barriers to this choice and work to break them down and develop pathways that are both realistic and flexible.

My Research Proposal

August 2, 2012

Title: “The profit impact of organisational gender Diversity programs”

Executive Summary:

This study will compare Gender Diversity Program frameworks for effectiveness, and identify and evaluate linkages to organisational profitability.  It will focus on the effectiveness (or otherwise) of Gender Diversity Programs (GDPs) within organisations in an effort to explore their relationship with the recruitment and retention of women in senior leadership roles.  The aims and objectives of this research are;

  1. To establish a link between Gender Diversity Programs and profit;
  2. To develop a repeatable framework for the measurement of this effectiveness;
  3. To develop benchmarks that support the framework;
  4. To prove a link to organisational profitability as a starting point to further study into the impact of gender on economies, i.e.: Gender Economics.

This proposal is the first part of a wider study to test the theory and viability of further research into Gender Economics and Diversity Economics by first establishing a link between Gender Diversity programs and organisational profitability.  Gender Economics is an emerging field of study that builds on the theories of diversity and promotes the value of gender balance, particularly in the area of innovation and creativity.  It recognises the ‘direct input’ of women to the economy and extends the theory that the discipline of economics “could be improved by freeing itself from masculine biases” (Ferber, Nelson 1993: 24).  Diversity Economics focuses on the organisational economics of diversity programs and follows the concepts of Economic Diversity,  “as a way to achieve economic stability”. (Wagner 1993) .

The second part of the study, will take the established link between Diversity Economics and profitability further to develop quantified economic models proving the case for Gender Economics using a cost benefit analysis.

Background to the Research:

Many forward-thinking organisations are undertaking Diversity programs in a bid to attract and retain the right people, because they must harvest a diverse talent pool to stay competitive.  This talent pool includes women, ethnic groups, Gen Y and Gen X and the instigation of programs to tap into talent in the ageing population.  This study will focus directly on Gender Diversity Programs, which create an organisational culture where gender inequalities are minimised.

Value of the Research:

Apart from estimated gains in productivity and profitability linked to an increase in gender balance, few empirically tested metrics currently exist to prove the success of these programs on profitability.

The importance of the research means that;

1)      By quantifying the impact of these programs on organisational profit, it is felt that more woman will have access to decision making roles and the ability to actively forge company strategy [1];

2)      New ways of thinking can be harnessed in the areas of creativity and innovation, vital to the growth potential of many global economies [2];

3)      A greater pool of skilled resources is accessible as a direct result of proving the effectiveness of gender diversity programs [3].

4)      Organisations can measure the impact of program outcomes through understanding the business benefits of a diverse gender mix, as well as measuring the impact of the programs’ performance through earned value analysis.

Establishing metrics and financial models to monitor the progress of gender diversity programs will help substantiate their effectiveness (or otherwise) on company profit.  This study will build on current evidence to substantiate quantitative findings.  Studies by the European Commission (2005), “found that only 30% of companies have systematic measurement and evaluation processes in place for their diversity initiatives”.  These measure quotas, targets or program performance but do not provide a causal link to profit.

“The prize for employers who are willing to tackle and challenge the current status quo could be huge.  The total benefits to the UK economy of reducing the gender segregation of jobs and increasing women’s employment has been estimated as anything up to a massive £23 billion. It could raise output in the UK by an equivalent 2% of Gross Domestic Product”.




[1] Gender Equality as Smart Economics: A World Bank Group Gender Action Plan (Fiscal years 2007–10), 2006

[2] U.S Secretary of State Hilary Clinton ”tapping into the innovation and creativity of women”, and cites Boston Consulting Group survey 1“Women are indeed the world’s third largest emerging market after China and India.”  [The survey] concludes “women will control $15 trillion in global spending by the year 2014 and by 2028 will be responsible for about two-thirds of all consumer spending worldwide.”

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