“Top corporate leaders, academics and policy makers have long been wondering about the real economic benefits of corporate diversity policies,” said Jing Zhao, Assistant Professor at Portland State University in Oregon, US. 

“Many didn’t see how hiring a more diverse workforce positively affected shareholder value. Now we have strong evidence that creating a more diverse workplace today results in more innovative outcomes for companies tomorrow,” Zhao added. 

The study, published in the journal Financial Management, showed firms that promote a diverse workforce and a culture of inclusion, specifically attracting and retaining minorities, women, the differently abled and LGBTQ (lesbian, gay, bisexual, and transgender and queer) employees, were more efficient in generating new products and patents. 

Diverse hiring practices increase the pool from which a firm is able to recruit talented and creative employees, it said. The wider the range of views and backgrounds, experiences and expertise the company attracted, the more innovative the company was to solve problems, Zhao said. 

The findings also showed that companies with pro-diversity policies weathered the 2008 economic downturn far better than those without them.