Diversity and inclusion: Evidence from corporate inventors

Inclusion is often considered a crux of diversity management. However, little is known about how board diversity affects corporate performance through organizational inclusive behavior. Using the inventor-level patenting data, we find that firms with more ethnic minority directors attract more produ...

Full description

Saved in:
Bibliographic Details
Published in:Journal of empirical finance 2021-12, Vol.64, p.295-316
Main Authors: Cao, Chunfang, Li, Xiaohui, Li, Xiaoyang, Zeng, Cheng, Zhou, Xuan
Format: Article
Language:English
Subjects:
Board diversity
Innovation
Inventor collaboration
Minority inventor
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Inclusion is often considered a crux of diversity management. However, little is known about how board diversity affects corporate performance through organizational inclusive behavior. Using the inventor-level patenting data, we find that firms with more ethnic minority directors attract more productive ethnic minority inventors and promote greater collaboration among inventors, leading to more patents and patents with greater market value. Our findings are robust to a battery of sensitivity tests. Overall, our study offers new evidence that racially diverse boards cultivate inclusive environment for inventors to succeed. •Board ethnic diversity is associated with better innovation performance.•Diverse boards foster innovation through creating an inclusive work environment.•Ethnically diverse boards tend to promote corporate diversity initiatives.
ISSN:0927-5398
1879-1727
DOI:10.1016/j.jempfin.2021.10.004