Published on: April 22, 2026 at 1:43 pm
The value of diversity within an executive team goes far beyond quarterly earnings. Research by Academy of Management Scholar Sekou Bermiss of the University of North Carolina’s Kenan-Flagler Business School has found no reliable evidence that financial performance is predicted by differences in ethnic diversity in top leadership.
“Differences in diversity at the very top of these large organizations are not predictive of financial performance,” Bermiss said. “What it also means is diversity at the very top of these organizations does not hinder performance in any negligible way as well.”
Bermiss offered organizations and leaders some tips on how to interpret this insight. For one, organizations should not stop their diversity efforts. He said to start by recognizing that “diversity doesn’t matter in the way that I think people think it matters. It matters in the margins and micro levels and decision-making in small groups.”
“The business case for diversity needs to be altered,” Bermiss said. “It needs to be changed from less of a purely revenue perspective and profit-driven argument for diversity and more to a moral argument and values-based discussion.”
According to Bermiss, when organizations are discussing how to implement diversity and representation, they should ask themselves, “Do we care about representation? Is that important to us from a values perspective and not that it will make us more money, or will customers like us more?” He added that organizations should carefully consider their decisions by asking, “Does that matter? Do we think that’s representative of anything?”
“Diversity doesn’t matter in the way that sometimes people are talking about it,” Bermiss said. “Diversity is nuanced and contingent.”
