Research

Firms with LGBT-friendly policies perform better

15 Jul 2021 By Jyoti Rambhai

Data suggests that progressive policies are linked with financial performance

Companies with LGBT-friendly policies have higher revenues, according to research by Aalto University School of Business and the University of Vaasa.

Using data from 657 publicly traded US firms from 2003 to 2016, the study examined whether there was a link between corporate LGBT-friendly policies and company performance.

It found that not only do such policies create more value, but they result in higher profitability and stock market valuations.

However, the research highlighted that these positive effects of progressive LGBT policies were mostly in firms located in more liberal US states. 

According to Jukka Sihvonen, researcher and assistant professor at Aalto University, firms with LGBT-friendly policies are associated with “greater employee commitment, improved job satisfaction, increased productivity, and more altruistic workplace behaviour”.

As a result, it improves the organisation’s ability to attract, recruit and retain talent and increases its competitive advantage in the jobs market.

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