Global perspectives on gender diversity and business performance

Abstract

Purpose Based on the resource-based theory, the purpose of this study is to investigate the relationship between operational employment levels of gender diversity and business performance over a multi-year period. This study also explores if gender parity moderates this relationship and how gender diversity is directionally developed. Design/methodology/approach A cross-lagged panel design and path analysis is applied to a global data set of women employees, women managers and women senior executives – in relation to revenue, of over 6,000 companies over the six-year period from 2012 to 2017. Findings Overall results confirm a positive relationship between women managers and revenue over a multi-year period for all companies. A moderating analysis also finds a positive relationship between total women employees (as well as women managers) and revenue growth of companies headquartered in countries with medium levels of gender parity. The overall and moderating analysis do not find a positive relationship between senior women executives and revenue growth. Longitudinal analysis also finds that the multiple operational levels of gender diversity directionally develop in a mutually cyclical manner. Originality/value To the best of the authors’ knowledge, this is the first diversity and business performance study to use a global data set of multiple operational levels of women employees, managers and senior executives over a multi-year period. This study contributes new perspectives on the positive relationship between women managers and business performance. This study also confirms prior findings of a positive relationship between women employees and business performance in medium gender-parity countries. Finally, this longitudinal study introduces the concept of the gender pipeline of executive advancement along the multiple operational levels of employment and finds that gender diversity is directionally developed in a mutually cyclical, bidirectional pattern.

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