The ESG Initiative at the Wharton School


DEI: a financial or moral imperative?

Outlet: The People Space

A recent paper argues there is no statistically strong relationship between diversity, equity and inclusion and better financial performance. Does this lessen the business case for investing in DEI or should the case instead rest on a cultural and moral imperative rather than profit? 

Hand’s and Green’s study follows a 2017 meta-analysis of peer-reviewed research on the effect of board gender diversity by the Wharton School of the University of Pennsylvania, which also found little or no positive correlation. Indeed Wharton management professor Katherine Klein went so far as to say “the relationship between board gender diversity and company performance is either non-existent (effectively zero) or very weakly positive.”