The people factor: how investing in employees pays off explores the role of labour practices in corporate value creation. The report analyzes how articulating employee-related commitments and following through with investments in employees impacts the ability of companies to deliver strong business outcomes. This new analysis should be of interest to a range of stakeholders, including corporate Boards of Directors, management teams and investors focused on long-term value creation. 

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This report is a result of research conducted by FCLTGlobal in collaboration with the CPP Investments Insights Institute and the ESG Initiative at the Wharton School, University of Pennsylvania. A working group comprised of FCLTGlobal members provided additional perspectives. The research builds on Walking the Talk: Valuing a Multi-stakeholder Strategy, a first-of-its-kind report published in 2022 that set forth the rationale for pursuing a multi-stakeholder approach to business by highlighting the value of delivering tangible outcomes to stakeholders (i.e., the walk) and presenting the firm as committed to stakeholder harmony (i.e., talk). Stakeholders examined in that foundational report included communities, customers, employees, the environment, government, shareholders and suppliers.  

The intent of this report is to make the case that following through on employee-centric commitments as stated in annual reports is associated with long-term value creation. Our goal is not to imply causation. While we conclude that companies walking the talk in their employee orientation create value, the causation debate remains open for further research.  

Key takeaways include: 

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Our Partners

Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the Fund in the best interest of the more than 21 million contributors and beneficiaries of the Canada Pension Plan. CPP Investments is a co-founder of FCLTGlobal and launched the CPP Investments Insights Institute to create enduring value by using CPP Investments’ global investing expertise, partnerships, and convening power to advance how the global investment ecosystem addresses climate change, technology disruption and evolving stakeholder expectations. 

The mission of the Environmental, Social and Governance (ESG) Initiative is, consistent with the vision of Joseph Wharton, to harness the power of business to “solve the social problems incident to our civilization.” The ESG Initiative conducts research that investigates the intersection of ESG factors and business and further advances Wharton’s best-in-class education of current and future practitioners, enabling them to serve a world undergoing tremendous change.

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