Workforce Diversity, Diversity Charters and Collective Turnover: Long‐term Commitment Pays

Abstract

Copyright © 2022 The Authors. Modern workplaces are becoming increasingly demographically diverse. However, the influence of workforce diversity on organizational outcomes is not fully understood. In this work, we study how and why workforce gender and racial diversity impacts collective turnover at the organizational level, and whether participation in and experience with diversity charters moderate this link. We particularly argue that greater workforce gender and racial diversity leads to greater collective turnover because it prompts social categorization and negative contagion in organizations. To mitigate these processes, organizations may participate in diversity charters, which are expected to provide support with managing workforce diversity and employee retention. We further argue that the influence of diversity charters follows a trajectory of maturity, so their benefits are magnified as an organization's experience with them increases. Drawing on a panel of UK universities, we find strong evidence that greater workforce racial diversity is associated with higher levels of collective turnover, but only weaker evidence for the positive link between workforce gender diversity and collective turnover. We further find that diversity charters may attenuate this link, but simply participating in them is not sufficient: instead, organizations must develop experience with charters over time.