Why might investors ask an organization for information and data on employee engagement and human resource practices before making an investment? Based on countless studies, highly engaged workforces and organizational performance are tightly connected. Investors are realizing they can earn a premium on their investments if they can find companies that invest in their people. Investors increasingly believe companies with highly engaged workforces produce the following results:
- Long-term, sustainable results
- Less risk and higher quality
- A more ethical work environment
- Ability to attract talent
- Higher levels of innovation
- Reduced employee turnover
- Higher productivity
So investors are looking for data and disclosures on human resource practices and evidence of highly engaged workforces. Check out the latest press release from the Human Capital Management Coalition, an investment consortium with $2.6 trillion in assets under management. Large, institutional investors are taking note of engagement and leaders of organizations might want to get out in front of this movement.
So as investors start demanding more transparency around workforce engagement, what are the implications? What do you think of this investor movement and what it might mean for how organizations approach workforce strategy and human resource practices? We would love to hear from you!