A Study of Diversity and Performance in Internal Audit Teams: Insights from Chief Audit Executives

In: Journal of International Accounting Research, S. 1-25

Abstract

ABSTRACT
Given heterogeneous findings on how diversity impacts performance, we investigate diversity in internal audit teams. Using responses from 302 chief audit executives, we analyze demographic and cognitive diversity's effects on perceived internal audit performance. Our metrics go beyond gender diversity to include nationality and education. National diversity gains importance with the increasing internationalization of companies and the global focus of internal auditing. Our findings highlight that gender diversity is conducive to team performance, whereas a skewed gender composition may impede it. We find that national and educational diversity might enhance perceived performance. However, our results indicate that in certain configurations, such as gender-uniform groups, perceived performance may be higher, revealing a complex relation between our measures for diversity and perceived performance. Our findings reveal diversity may induce biases to exclude minority groups, such that teams do not integrate additional perspectives to improve decision-making and offset the expected benefits of diversity.
Data Availability: The data that support the findings of this study are available from the authors upon request.