{"id":7956,"date":"2017-05-09T00:03:00","date_gmt":"2017-05-09T00:03:00","guid":{"rendered":"https:\/\/arliemediadesign.com\/?p=7956"},"modified":"2025-03-15T00:09:58","modified_gmt":"2025-03-15T00:09:58","slug":"happy-workplaces-have-higher-share-growth","status":"publish","type":"post","link":"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/","title":{"rendered":"Happy Workplaces Have Higher Share Growth"},"content":{"rendered":"\n

Dr. Andrew Chamberlain, Glassdoor\u2019s chief economist,\u00a0says<\/a>\u00a0\u201cthe research shows that companies recognised for excellent culture and high employee satisfaction outperform the stock market over time \u2014 while companies that rank poorly have significantly underperformed.\u201d<\/p>\n\n\n\n

A\u00a0recent Glassdoor research report<\/a>\u00a0found that an investment made in 2009 in a stock portfolio comprised of companies listed in Glassdoor\u2019s 50 \u201cbest places to work\u201d list would have outperformed the S&P 500 by up to 36%.<\/p>\n\n\n\n

A Russell Investment Group study of stock market returns of companies from Fortune magazine\u2019s annual\u00a0\u201c100 best companies to work for\u201d<\/a>\u00a0list looked at the average annual returns for companies on each year\u2019s list, over 17 years from 1997 to 2013. Average annual returns for the S&P 500 were 6.0% while annual returns for those companies that made Fortune\u2019s list were a staggering 11.8%.<\/p>\n\n\n\n

The 13 companies that have been on the Fortune list every year since the beginning have scored a\u00a0cumulative return of 495%<\/a>, almost three times the 170% growth of the S&P 500.<\/p>\n\n\n\n

Similarly, The Boston Consulting Group, in association with World Federation of People Management Associations\u00a0have shown<\/a>\u00a0that companies that have made the \u201c100 Best Companies to Work For\u201d list for three or more years outperform the S&P 500 by 99 percentage points over a 10 year period between 2001 and 2011.<\/p>\n\n\n\n

In the most detailed econometric study of this data to date\u00a0Alex Edmans<\/a>, then at Wharton Business School at the University of Pennsylvania, analysed the result of investing in the companies listed in the Great Place to Work listings over the last 25 years. He found a difference, compared to the stock market, of 3.5% a year.<\/p>\n\n\n\n

An investment which would have returned $100,000 in a tracker fund would have achieved $236,000 from investing in companies that focus on creating great workplaces and prioritise employee happiness.<\/p>\n\n\n\n

This is further evidence for the strong correlation between employee happiness and shareholder returns. While admittedly the evidence is correlation-based, the lessons are still clear: employee happiness is a strong predictor of long-term company performance.<\/p>\n\n\n\n

Jerome Dodson, founder of the\u00a0Parnassus Workplace Fund<\/a>\u00a0has fully embraced \u201cthe idea of creating a fund that only invested in organisations where employees were really happy\u201d and he has done rather well as a result. He invests in companies from the \u201c100 best companies to work for\u201d list and over ten years up to February 2016 the Parnassus Workplace Fund has shown an average annual return of 10.62%, putting it in the top 1% of US mutual funds and showing a return of almost double the S&P Index every year.<\/p>\n\n\n\n

It now manages over $1.3 billion and Dodson has achieved this through abiding to\u00a0the simple philosophy<\/a>\u00a0that \u201cconsistently more engaged performance inevitably reveals itself in the firm\u2019s bottom line.\u201d<\/p>\n\n\n\n

The reality is that companies with employees who love going to work will do better than companies whose employees don\u2019t and the results of Parnassus are evidence of this truth.<\/p>\n\n\n\n

Finally, James Harter, a\u00a0Gallup researcher<\/a>, found that you can predict future increases or decreases in sales and profits by measuring employees\u2019 feelings about their organisation. Harter has \u201cproven that engaged organisations have 3.9 times the earnings per share (EPS) growth rate compared to organisations with lower engagement in their same industry.\u201d<\/p>\n\n\n\n

The takeaway? The happier the employees the higher the share growth. Simple!<\/p>\n\n\n\n

This guest blog was written by Rian Doris while an intern at Happy. Rian is a student of Philosophy at Trinity College Dublin with a passion for Positive Psychology and all things wellbeing related. After completing undergraduate studies, he is aiming to pursue a Masters in Applied Positive Psychology and then go on to do further research in the field. Contact him at riandoris@gmail.com.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The link between staff happiness and engagement has been shown in countless studies to improve staff retention, improve productivity and increase profits \u2013 and it\u2019s also been shown to dramatically increase share growth.<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[24,25],"tags":[],"blog-post-type":[35],"class_list":["post-7956","post","type-post","status-publish","format-standard","hentry","category-henrys-blog","category-the-happy-manifesto","blog-post-type-blog-with-image"],"acf":{"read_or_watch_time":"Read length: 5 min read"},"yoast_head":"\nHappy Workplaces Have Higher Share Growth - Happy<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Happy Workplaces Have Higher Share Growth\" \/>\n<meta property=\"og:description\" content=\"The link between staff happiness and engagement has been shown in countless studies to improve staff retention, improve productivity and increase profits \u2013 and it\u2019s also been shown to dramatically increase share growth.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/\" \/>\n<meta property=\"og:site_name\" content=\"Happy\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/HappyLtd\" \/>\n<meta property=\"article:published_time\" content=\"2017-05-09T00:03:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2025-03-15T00:09:58+00:00\" \/>\n<meta name=\"author\" content=\"Henry Stewart\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@happyltd\" \/>\n<meta name=\"twitter:site\" content=\"@happyltd\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Henry Stewart\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/\"},\"author\":{\"name\":\"Henry Stewart\",\"@id\":\"https:\/\/www.happy.co.uk\/#\/schema\/person\/d908b838c968ee1e7ac9fef10a219ddc\"},\"headline\":\"Happy Workplaces Have Higher Share Growth\",\"datePublished\":\"2017-05-09T00:03:00+00:00\",\"dateModified\":\"2025-03-15T00:09:58+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/\"},\"wordCount\":613,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/www.happy.co.uk\/#organization\"},\"articleSection\":[\"Henry's blog\",\"The Happy Manifesto\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/\",\"url\":\"https:\/\/www.happy.co.uk\/blogs\/happy-workplaces-have-higher-share-growth\/\",\"name\":\"Happy Workplaces Have Higher Share Growth - 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