Diversification and Diversity: Difference between pages

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''Risk management.''
1. ''Corporate governance''.


Diversification is the process of spreading risk, to limit the possibility that an adverse event affecting a small number of investments could have an unacceptably detrimental effect on the overall portfolio.
In the corporate governance context, diversity refers to the range of people employed by an organisation, especially in the most senior positions, including the board of directors.


Often summarised as 'Don't put all your eggs in the same basket'.
Diversity normally includes gender, race, sexual orientation, religion, nationality, disability, age and educational background, but it may include other additional factors.


In corporate finance, the term is often used to mean the process of ensuring that an investment portfolio is constructed such that all possible specific risk (diversifiable risk) is eliminated.


2. ''Investment''.


Diversification is a form of risk reduction.
In the investment context, diversity is the beneficial result of the appropriate diversification of investments.


However, some residual risks cannot be eliminated by diversification.


== See also ==
* [[30% Club]]
* [[Board of directors]]
* [[Corporate governance]]
* [[Corporate social responsibility ]]
* [[D&I]]
* [[Developments in corporate and market regulation: implications for the treasurer]]
* [[Diversification]]
* [[ESG investment]]
* [[Ethics]]
* [[Governance]]
* [[Kay Review]]
* [[Institute of Business Ethics]]
* [[Shareholder value]]
* [[Stem]]
* [[UK Corporate Governance Code]]


== See also ==
* [[Asset allocation]]
* [[Cash in the new post-crisis world]]
* [[Correlation]]
* [[Credit risk diversification]]
* [[Diversifiable risk]]
* [[Diversity]]
* [[Market risk]]
* [[Matching]]
* [[Portfolio]]
* [[Specific risk]]
* [[Undiversifiable risk]]


[[Category:Risk_frameworks]]
===Other links===
[http://www.treasurers.org/node/10141 Doing the right thing, ''Sarah Boyce'', The Treasurer]
 
[[Category:Investment]]
[[Category:Ethics_and_corporate_governance]]

Revision as of 15:44, 10 July 2018

1. Corporate governance.

In the corporate governance context, diversity refers to the range of people employed by an organisation, especially in the most senior positions, including the board of directors.

Diversity normally includes gender, race, sexual orientation, religion, nationality, disability, age and educational background, but it may include other additional factors.


2. Investment.

In the investment context, diversity is the beneficial result of the appropriate diversification of investments.


See also


Other links

Doing the right thing, Sarah Boyce, The Treasurer

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