Obviously it doesn't "damage the code" but if a team of, say, 45 has no one who can speak English as well as a Scandinavian thirteen year old, then chances are that team doesn't consist of the 45 top geniuses of the country. The ability to speak English well correlates with intelligence, and although there are exceptions, the bigger the team the more unlikely it is that all the smart people in it are exceptions. That's disregarding the fact that crappy English is a pretty serious drawback when you want to sell (=market) your game to the English speaking world.
I wouldn't hire a coder that couldn't speak good English, it's a reflection of their coding skills as well.
