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Diversity messages may backfire when companies focus on diversity’s benefits for bottom line

Companies that justify their diversity efforts by saying that a diverse workforce will improve their bottom line risk alienating the diverse employees that they hope to attract, according to research published by the American Psychological Association.

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Companies that justify their diversity efforts by saying that a diverse workforce will improve their bottom line risk alienating the diverse employees that they hope to attract, according to research published by the American Psychological Association.

That’s because such “business case” justifications for diversity can backfire, by making members of underrepresented groups – such as LGBTQ professionals, women in STEM (science, technology, engineering and math) fields and Black students – feel that they will be judged based on their social identity if they join the company.

“These business-case justifications are extremely popular,” said lead author Oriane Georgeac, PhD, a professor at the Yale School of Management. “But our findings suggest that they do more harm than good.”

Many companies offer either a “business case” explanation for why they value diversity (e.g., “we value diversity because it will help us better serve our customers and improve our bottom line”), or a “fairness case” explanation (e.g., “we value diversity because it’s the right thing to do”). Georgeac and co-author Aneeta Rattan, PhD, a professor at London Business School, sought to explore how common these two justifications are and how they affect potential employees’ impressions of what it would be like to work at a given company.

First, the researchers gathered the online diversity statements of every company on the Fortune 500 list and used artificial-intelligence-based language analysis to analyze whether each statement presented primarily a business case or a fairness case for diversity. Overall, they found that about 80% of the companies offered a business-case justification for valuing diversity, while less than 5% offered a fairness-case explanation; the rest made no public diversity statements or did not offer any justification.

Next, the researchers conducted five online experiments in which they asked job seekers from three underrepresented social identities – LGBTQ professionals, female STEM-job seekers and Black students – to read business-case or fairness-case diversity statements from fictional companies and to answer questions about how much belonging they anticipated feeling there, and how much they would want to work there.

On average, the researchers found that among the LGBTQ professionals, female STEM-job seekers and Black students, reading business-case diversity statements undermined participants’ anticipated sense of belonging to the company, and in turn, their desire to join the company, compared with reading fairness-based diversity statements or diversity statements that provided no explanation.

Further analyses found that one explanation for why the business-case justifications affected these participants was that it increased participants’ “social identity threat,” or their concern that the company would see and judge them, as well as their work, in light of their social identity.

“On the surface, this rhetoric may sound positive,” Georgeac said. “However, we argue that by uniquely tying specific social identities to specific workplace contributions, business-case justifications for diversity justify the fact that organizations may attend to individuals’ social identities when forming expectations about, and evaluating, their work. In other words, business-case justifications confirm to women and underrepresented group members that they must worry about their social identities being a lens through which their contributions will be judged. And this is threatening to these groups.”

Some of the experiments in the study also compared the responses of members of underrepresented groups to those of well-represented groups. The researchers found that the business case may sometimes also threaten members of some well-represented groups.

“Men in STEM showed no differences in their responses to the different types of diversity justifications they read, but white Americans after the murder of George Floyd did appear to be threatened by the business case, relative to the fairness case or no case. This seeming discrepancy across well-represented groups is fascinating and calls for further investigation,” Georgeac said.

“The Business Case for Diversity Backfires: Detrimental Effects of Organizations Instrumental Diversity Rhetoric for Underrepresented Group Members Sense of Belonging,” by Oriane Georgeac, PhD, Yale School of Management, and Aneeta Rattan, PhD, London Business School, appeared in the Journal of Personality and Social Psychology

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Reversible words can lower consumer disbelief in ads

A simple word choice in marketing messages can significantly impact how confident consumers feel about believing – or not believing – a claim.

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It’s estimated that consumers experience hundreds if not thousands of marketing messages daily. While the exact number can depend, how much someone believes the message can be more important for marketing success than the number of messages they see. 

A new study reveals that a simple word choice in marketing messages can significantly impact how confident consumers feel about believing – or not believing – a claim. Researchers found that when words differ in their “reversability,” or how easily people can think of their opposites, it can trigger different mental processes when consumers evaluate marketing language. 

Imagine the messaging options for a new sunscreen designed specifically for those who like a strong scented product. The first product description reads, “The scent is prominent,” while the second notes, “The scent is intense.” The word “prominent” is uni-polar, meaning people tend to negate it by adding “not” to the original statement.

“Intense,” though, is a bi-polar word, meaning readers can easily come up with its opposite meaning and negate the statement by replacing it with its antonym. In this example, “The scent is mild,” instead of, “The scent is intense.” 

“When people encounter easily reversible words, like ‘intense’, in messages processed as negations (mild), they experience lower confidence in their judgements compared to words that are hard to reverse, like ‘prominent,’” explained Giulia Maimone, a postdoctoral scholar in marketing at the University of Florida Warrington College of Business. 

Across two experiments of more than 1,000 participants, the research demonstrated that this effect occurs because negations of bi-polar, or reversible, words engage a more elaborate cognitive process requiring additional mental effort, resulting in lower confidence of the statement’s truthfulness. 

Based on their findings, the researchers suggest that marketers take this advice when crafting language: for new products, use affirmative statements with easily reversible words, like ‘The scent is intense’ in the sunscreen example, which most consumers will judge as true with high confidence. Importantly, this language would also minimize the confidence of consumers who will be skeptical about the message, as they will process it via a more complex cognitive process that reduces confidence in those consumers’ disbelief. 

“This simple lexical choice could help companies maximize confidence in their desired messaging and minimize confidence among the doubters,” Maimone explained. 

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If you’re a perfectionist at work, your boss’ expectations may matter more than your own, research finds

Help your employees by clarifying expectations through regular feedback and performance conversations to reduce role ambiguity, as doing so can provide employees with a better understanding of role expectations and enhance mutual understanding of those standards.

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If you’re among the 93% of people who struggle with perfectionism at work, new research suggests that your experience may depend less on your own high standards and more on whether those standards meet your supervisor’s expectations. 

Researchers from the University of Florida Warrington College of Business found that whether perfectionism helps or harms employees depends largely on whether employees’ personal standards align with their supervisors’ expectations. 

Specifically, they looked at the connection between employees’ self-oriented perfectionism, or the expectations of flawlessness they set for themselves, and supervisors’ other-oriented perfectionism, which reflects the extent to which they set excessively high standards for and critically evaluate their employees’ performance. 

Using data from more than 350 employees and about 100 supervisors, the researchers found that perfectionism’s impact depends on whether employees’ standards align with what their supervisors expect and how clearly those expectations are understood. 

When employees’ personal standards are aligned with their supervisors’ expectations, they tend to experience less role ambiguity, meaning they have less uncertainty about the expectations and standards for their role, why those standards matter and the consequences of not meeting them. This clarity in their work is linked to better performance, lower burnout and higher job satisfaction. 

“Problems between employees and their supervisors are more likely to arise when these expectations don’t match,” explained Brian Swider, Beth Ayers McCague Family Professor.

The most difficult situation occurs, Swider and his colleagues found, is when supervisors expect higher levels of perfectionism than employees expect from themselves. In these cases, employees reported greater uncertainty about their roles, along with worse work outcomes including higher burnout and lower job satisfaction.

“If you’re an employee who struggles with perfectionism at work, our findings suggest that understanding your supervisor’s expectations may be just as important as managing your own tendencies towards perfectionism,” Swider said. “Talking to your supervisor about priorities, standards and how your performance will be evaluated can help reduce uncertainty and ensure you both share a clear understanding of what success looks like.”

The researchers have similar recommendations for employers: help your employees by clarifying expectations through regular feedback and performance conversations to reduce role ambiguity, as doing so can provide employees with a better understanding of role expectations and enhance mutual understanding of those standards.

The researchers also recommend that organizations should consider how employees and supervisors are paired, as mismatched expectations can increase stress, reduce job satisfaction and ultimately impact performance. 

The research, “The influence of employee-supervisor perfectionism (in)congruence on employees: a configurational approach,” is published in Organizational Behavior and Human Decision Processes

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Study shows scaling startups risk increasing gender gaps

Founders with HR‑related education counteract these challenges. In ventures led by founders with HR training, the odds of hiring a woman increase by more than 30 percent, and the odds of appointing a woman to a managerial role increase by 14 percent for the same level of scaling.  

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When startups scale quickly, founders often make hurried hiring decisions that unintentionally disadvantage women, according to new study from the Stockholm School of Economics in Sweden. The study shows how the pressures of rapid growth increase the likelihood that founders rely on mental shortcuts and make biased decisions. 

Drawing on large‑scale Swedish data, the study shows that scaling—when companies hire far more people than their usual growth trend would predict—puts pressure on founders to decide swiftly, which increases the use of mental shortcuts. These shortcuts can activate gender stereotypes, shaping who gets hired and who moves into managerial roles.  

“During those moments of rapid growth, even well‑intentioned leaders can fall back on familiar stereotypes when assessing who they believe is best suited for the role,” says Mohamed Genedy, co-author and Postdoctoral Fellow at the House of Innovation, Stockholm School of Economics. 

Reduced odds of hiring female managers 

His research analyzes more than 31,000 new ventures founded in Sweden between 2004 and 2018. It finds that in male‑led startups, scaling reduces the odds of hiring a woman by about 18 percent, and the odds of appointing a woman to a managerial position by 22 percent.  

These patterns emerge even in a highly gender‑equal national context, making the findings especially noteworthy.  

Crucially, the study reveals that founders with HR‑related education counteract these challenges. In ventures led by founders with HR training, the odds of hiring a woman increase by more than 30 percent, and the odds of appointing a woman to a managerial role increase by 14 percent for the same level of scaling.  

“When founders have experience with structured hiring practices, the gender gaps shrink, and in some cases even reverse,” Genedy says.  

“This shows that getting the basics of HR right early on really pays off. When things start moving fast, founders with HR knowledge are less likely to rely on biased instincts and more likely to hire from a broader talent pool.”  

Prior experience in companies with established HR practices also helps, though less so. It raises the likelihood of hiring women as the new ventures scale, but does not significantly affect managerial appointments. 

Differences persist in female-led ventures 

The study additionally shows that these patterns are not driven by founder gender alone. Even solo female‑led ventures display similar tendencies when scaling, though to a somewhat lesser degree.  

And in female‑dominated industries, scaling increases the hiring of women for regular roles but still reduces the likelihood that women are appointed into managerial positions.  

“When scaling accelerates, cognitive bias kicks in for everyone,” says Mohamed Genedy. “Female founders are not immune to these patterns.”  

Together, these results point to underlying cognitive mechanisms that shape decisions under time pressure.

The study, Scaling with Bias? The role of founders’ HR knowledge and experience in hiring and managerial appointments, was published in Human Resource Management.

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