I miswrote a few weeks back when I stated that an assertion by a DEI pimp that “studies show that diversity” makes organizations more successful and effective was a Big Lie, one of those “facts” (like the alleged percentage of women who are sexually molested, or women only making 76 cents for every dollar earned by men for the same job) that have gained currency by repetition by activists without solid evidence to support them. There are studies that purported to support the DEI contention, all from the same management consulting firm McKinsey & Company, carving out a profitable little niche for itself. Aside: I have worked for and with consulting companies. Consulting is a business, not a profession, and such companies strongly tend to give clients what they want to hear, thus making such firms popular and wealthy. Sadly, this is also true of ethics consulting firms and ethics consultants. I won’t provide an expert opinion crafted to make a client happy, and that is why I’m about three months from living in a cardboard box.

Back when I accepted gigs to do training in “diversity” for bar associations, there were no such studies, and because the diversity virtue-signaling fad was already galloping along then, I carelessly assumed that some enterprising “researchers” hadn’t manufactured “science” to support what was already conventional wisdom in the years since I decided that I couldn’t in good faith keep accepting money to teach politically correct nonsense. The McKinsey & Company studies, all claiming to “prove” the value of “diversity,” were published in 2015, 2018, 2020, and 2023, thus giving the private sector, government, the military, the professions and academia something to justify their woke crusades.

One would think that the fact that all of those studies “proving” the value of diversity came from the same factory might have prompted a teeny bit of suspicion, but no. Opposing this particular cornerstone of DEI mania brands critics as racists, after all. Now, however, a new study by Jeremiah Green and John R.M. Hand has been published in the March 2024 issue of the peer-reviewed “Econ Journal Watch” in which the researchers describe their attempts to replicate the results of McKinsey studies. Surprise! They couldn’t.

Legal Insurrection:

The 2023 McKinsey & Company study summarizes the firm’s prior results showing that businesses with racially and ethnically diverse executive teams had a strong advantage in financial performance. McKinsey & Company’s studies used unspecified “publicly available data” from more than 1,000 companies worldwide. The Econ Journal Watch study limited its focus to companies in the United States because “racial and ethnic diversity is an ongoing and currently politically and socially important issue in the US.”

McKinsey & Company, according to Green, would not share its dataset, citing the confidentiality of its clients, some of whom were presumably included in the McKinsey & Company studies. Green and Hand instead had to use companies from the S&P 500, the index of the largest publicly traded companies in the United States.

“Since we know [McKinsey & Company] have substantial business in the U.S. and we don’t know the scope or location of their international clients, we had to start with what we could reasonably collect,” Green told Legal Insurrection.

Green and Hand replicated McKinsey & Company’s methodology, which included sorting executive team members into racial categories after reviewing the executive’s picture and name. Green and Hand, like McKinsey & Company, then determined financial performance using the EBIT margin, which measures a business’s earnings before interest and taxes.

Green and Hand’s study critiqued McKinsey & Company’s methodology for getting causation backward. They note that McKinsey & Company “measures firm financial performance over the four or five years leading up to the year in which they measure the race/ethnicity of the firm’s executives,” so financial performance precedes and may, in fact, lead to diversity.

Caught like rats in a trap (as the Three Stooges used to say) McKinsey had to concede that their critics have a point. “It is theoretically possible that the better financial outperformance enables companies to achieve greater levels of diversity,” the firm responded to the Green and Hand paper. “Companies that perform well financially may choose to deploy more of their resources toward more advanced talent strategies, thus allowing them to attract more diverse talent, for example.”

Oh. Funny that they didn’t bother to mention that in the decade their studies have been used to inflict racial and gender bias and discrimination into hiring and recruiting decisions across the culture, while elevating such individuals as Claudine Gay, Kamala Harris, Karine Jean-Pierre and Pete Buttigeig into important jobs they were not qualified to do. [Update: After posting this, I saw Ann Althouse’s post about yet another Harris debacle.]

Here’s the best part: “McKinsey & Company further acknowledged that its work only established “a correlation, not a causal link.” “Correlation does not prove causation” is a universally accepted principle of statistical research. But Green and Hand couldn’t even find a statistically significant relationship between diversity in executive teams and financial performance.

“We did try to exactly replicate their results as much as we could with what we know with a reasonable sample,” Green told Legal Insurrection. They even relaxed their methodology to show at least some financial benefit to diversity, using “different definitions of diversity, different measures of performance, and different testing methods.” Nothing.

Conclusion: these pro-diversity studies were one more example of props for “follow the science” activists to justify and advance their ideological agendas.