Leadership Diversity and Its Influence on Equality Initiatives and Performance: Insights for Construction Management

Abstract

Gender-diverse leadership shapes the design and delivery of policies, programs, and practices implemented to address diversity management. Drawing on stakeholder theory, this paper proposes and tests the positive impacts of board gender diversity and top management team gender diversity on diversity-related human resource initiatives and work–life initiatives. Moreover, using strategic human resource management theory and ability–motivation–opportunity theory, this study proposes and tests the positive effects of human resource and work–life initiatives on organizational financial performance. Based on contingency theory, it proposes and tests the moderating effect of an inclusive diversity environment on the initiatives and financial performance relationship. Using time-lagged archival data collected from 367 Australian organizations, findings indicate board gender diversity is positively associated with both human resource and work–life initiatives designed and implemented to address diversity management. Work–life initiatives are positively associated with both increased operating revenue and profit before tax. Further, the work–life initiatives–profit before tax relationship was strongly positive for organizations with a high diversity environment. We discuss theoretical and research contributions and practical implications.