The ethical and socially responsible goals of leaders and their organizations include providing adequately for members of the diverse work force. Ethical leaders should therefore feel compelled to use merit instead of favoritism or bias as a basis for making human resource decisions. A firm that embraces diversity is also behaving in a socially responsible manner. According to research and opinion, managing for diversity also brings the firm a competitive advantage.

A major component of the marketing advantage of diversity is that a work force that matches the diversity of a company’s customer base has an edge in appealing to those customers. Companies with a favorable record in managing diversity are at a distinct advantage in recruiting and retaining talented people. Also, a company that does not welcome a diverse work force shrinks its supply of potential candidates.

Heterogeneity in the work force may offer the company a creativity advantage, as well as improve its problem-solving and decision-making capability. Creative solutions are more likely to be reached with a diversity of perspectives. Similar to the creativity advantage, cultural diversity can enhance team performance, often because diverse backgrounds are associated with diverse information, knowledge, and perspectives that can be used to solve problems. The leader of the diverse group must help members collaborate; otherwise, the advantages of diverse perspectives will be lost.