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This paper examines the influences of cultural diversity in the top management team (TMT) on organizational performance. The link between the two is investigated through the path dependency model, where firm ambidextrous orientation serves an intervening role. The results of the study suggest that TMT cultural diversity will have a negative influence on firm performance due to the decreasing degree of ambidextrous orientation being a result of TMT diversity. The study is based on the survey filled out by 82 CEO of Danish and Swedish listed corporations. Studies theoretical contribution is expressed in uncovering the mediating role of firm’s ambidextrous orientation on the TMT diversity – performance relationship.

Top management team’s cultural diversity and firm performance: the mediating role of ambidextrous orientation