Recently I read a post on http://creativelypaid.wordpress.com and the author mentioned something that peaked my interest. The author wrote a post about how investing in a company is similar to voting with your stock and how you should invest in companies that make a positive impact on the world. There have been sources that indicate that the World’s Most Ethical Companies from 2009 have grown at a rate nearly double that of the S&P 500.
Being the curious person that I am, I decided to dig a little deeper and do some research myself. My first task was to identify companies that treat their employees great. Companies that treat their employees right tend to have happier employees, and this rubs off on their customers. One such company that I can think of off the top of my head is Starbucks. Starbucks gives employees great benefits, such as stock options, a pound of any Starbucks coffee a week (or other goodies), health insurance, and 401(k) plans for their employees. While these perks do cost Starbucks a pretty penny, the benefits are completely worth it. Studies have shown that Starbucks employees are actually friendlier than local coffee shop employees as illustrated below:
“It was clear that the baristas were on a first-name basis with many of the customers, were familiar with their regular orders, and knew significant personal information about them,” the study says.
With that being said, I got a listing of Fotune’s 500 Best Companies to Work For from 2005 and took the publicly traded companies from that list and looked at their total returns since December 31, 2005 through December 12, 2013. One thing I will note is that some of the companies that were on the list that were public are no longer public (mainly because they were purchased by other companies). Without further ado, here is a chart I compiled of returns:
|Dow Jones Industrial Average||44.61|
|Average return of Best Companies to Work For||79.83|
As you can see, companies with happier employees tend to have better returns than those of the market by almost double! Think about next time you make your investment decisions!