Adding Women to the C-Suite Changes how companies think

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Dr. Post and colleagues write for the Harvard Business Review summarizing recent research pointing that gender diversity adds value beyond perspectives. 

It’s well known that firms with greater gender diversity among senior leadership perform better. But what’s less clear is why exactly that is. What are the specific mechanisms that drive the positive business outcomes associated with increasing the number of women in the C-suite? In this piece, the authors share new research that explores exactly how the addition of female executives shifts companies’ strategic approach to innovation. Based on an analysis of more than 150 companies, the authors find that after women join the top management team, firms become more open to change and less open to risk, and they tend to shift from an M&A-focused strategy to more investment into internal R&D. In other words, when women join the C-suite, they don’t just bring new perspectives — they actually shift how the C-suite thinks about innovation, ultimately enabling these firms to consider a wider variety of strategies for creating value.