As businesses expand across borders, their teams are increasingly multilingual; nine in 10 US companies rely on employees who speak languages other than English. Yet language diversity remains one of the least understood aspects of team dynamics. Leaders often assume that a common corporate language — typically English — is enough to ensure smooth collaboration. But research suggests that it actually requires more deft management.
As the world celebrates UN International Mother Language Day, observed every year on February 21 to promote linguistic and cultural diversity and multilingualism, it is becoming increasingly evident that language diversity, when managed well, is a strategic asset.
“Openness to language diversity enhances the positive effects of cultural diversity on team performance — though not necessarily creativity,” says Minna Paunova, associate professor of management at ESCP. Her recent study, published in the European Journal of International Management, explores how embracing linguistic diversity shapes team outcomes.
Our study found that openness to language diversity strengthens the relationship between diversity and performance. In business settings, this may translate into more effective global collaboration, better decision-making and increased innovation.
The creativity-performance paradox
For organisations that thrive on innovation, creativity is currency. Multicultural teams bring different worldviews and problem-solving approaches, making them fertile ground for fresh ideas. But how does language diversity influence this dynamic?
Paunova’s research, conducted with colleagues, suggests that creativity benefits from a certain level of friction — contrasting perspectives that challenge conventional thinking. “Creativity often thrives on differences and even a certain level of constructive tension,” she explains. “While performance benefits from cohesion and shared understanding, creativity may emerge from the friction of diverse perspectives, where new ideas are sparked through contrast rather than complete alignment.”
This means that while cultural diversity fosters creativity, teams don’t necessarily need to be equally open to both language and cultural diversity for innovation to flourish. Performance, on the other hand, benefits from clarity, alignment and effective communication — all areas where Paunova says language diversity can either be a catalyst or a roadblock.
The business case
Beyond creativity, language diversity can generate tangible business benefits, particularly when teams and leaders are intentional about inclusion.
“Our study found that openness to language diversity strengthens the relationship between diversity and performance,” says Paunova, who co-authored her research with several academics. “In business settings, this may translate into more effective global collaboration, better decision-making and increased innovation.”
Consider multinational corporations operating across diverse markets. Teams with multilingual capabilities could better understand local customer needs, regulatory landscapes, and also build relationships in ways that monolingual teams cannot, Paunova suggests.
There’s also a strong link between language diversity and employee engagement. “Language diversity can enhance employee engagement by fostering an inclusive work environment, where individuals feel valued for their unique contributions,” Paunova notes. But achieving this requires moving beyond token diversity and actively building an inclusive environment.
The hidden pitfalls
Despite its advantages, language diversity can introduce challenges that — if left unaddressed — can undermine team cohesion, stymie decision-making and skew leadership distribution. Fluent speakers of the dominant language are disproportionately perceived as competent, and thereby gain more influence or have greater access to top jobs.
1. ‘Fluency bias’
In linguistically diverse teams, Paunova says individuals who speak the dominant language fluently are often perceived as more competent and naturally assume leadership roles — even when their expertise doesn’t justify it. This unconscious bias can sideline those who may have better ideas but struggle with fluency.
To avoid this, she says leaders should actively decouple language fluency from competence and leadership potential. Structured facilitation — such as rotating meeting chairs, using written collaboration tools or explicitly seeking input from quieter voices — can help level the playing field.
2. Social exclusion
Teams often form subgroups based on shared native languages. While this is natural, it can lead to knowledge silos, limiting cross-team collaboration and weakening overall cohesion.
Paunova recommends encouraging mixed-language collaboration by creating “linguistic safe zones”. For example, allowing team members to brainstorm in their native language before presenting in the dominant corporate language can ensure ideas aren’t lost due to language barriers.
3. Distorted decision-making
When fluency dictates participation, valuable insights from less fluent team members may be overlooked. Research shows that teams often default to the most articulate speakers rather than the most knowledgeable ones.
Paunova says leaders should normalise different levels of fluency and use multiple communication channels — such as written formats, visual aids and structured discussions — to ensure all voices are heard.
4. Language anxiety
For non-native speakers, participating in discussions can be stressful. Fear of making mistakes may prevent employees from fully engaging, reinforcing the perception that they are less competent.
The solution? Create a psychologically safe environment where employees feel comfortable speaking, even with imperfect language skills. Training for both native and non-native speakers — teaching the former how to communicate more inclusively — can be a game-changer, Paunova notes.
Language diversity alone doesn’t automatically enhance creativity or performance. It is openness, active engagement and a willingness to work through both visible and invisible differences that truly create a dynamic and innovative team environment.
Lessons from companies
Global companies are already harnessing language diversity for competitive advantage. Some, like Germany software giant SAP, have invested in multilingual communication-training to help employees collaborate across linguistic boundaries. Others, like US home rentals platform Airbnb, structure their customer support teams to be multilingual, ensuring deeper connections with diverse users.
Meanwhile, Rakuten, the Japanese internet bank, took a different approach: implementing an “Englishnisation” initiative, requiring all employees to use English for corporate communication. While controversial at first, it ultimately boosted collaboration across regions — though not without challenges for non-native speakers.
This reflects a broader tension in global business: while adopting English as a common corporate language is not without its drawbacks, there is often no viable alternative. In multinational environments, a shared language is essential for efficiency, coordination and knowledge exchange. The challenge, then, is not whether to use a common language, but how to do so in a way that acknowledges linguistic diversity, and levels the playing field for all employees.
As the world marks UN International Mother Language Day, the lesson is that business leaders should recognise that language diversity is about more than inclusion; it adds to performance, innovation and competitive advantage.
Paunova puts it best: “Language diversity alone doesn’t automatically enhance creativity or performance. It is openness, active engagement and a willingness to work through both visible and invisible differences that truly create a dynamic and innovative team environment.”
The bottom line: in a globalised world, the language of success is multilingual.
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