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Employees Are More Vital To A Company’s Success Than Shareholders, New Survey Finds

Source | www.forbes.com | Kristin Stoller

For the first time, employees are considered companies’ most important stakeholders for long-term success—three times more important than shareholders.

That’s according to communications firm Edelman, which released its 2021 mid-year Trust Barometer report Thursday. The company surveyed more than 16,800 people in 14 countries between April 30 and May 11.

Some 40% of those surveyed rank employees as the group most important to the success of a company, while just 12% say the same about shareholders. A focus on employees will, however, ultimately benefit shareholders, says Laura Field, the interim director for the University of Delaware’s Weinberg Center for Corporate Governance.

Studies show that when employees’ needs are met, profitability can soar, she says. For example, a 2019 Gallup survey found that companies with engaged employees can see profitability increase by 21%.

As employees increasingly put pressure on their companies to publicly advocate for issues ranging from voting rights to fair wages, how employers choose to respond can have wide-ranging implications. Nearly 80% of employees expect their employer to act on issues such as vaccine hesitancy, climate change, the infodemic, racism and retraining.

“Environmental, social and corporate governance issues are of vastly greater importance to Millennials and [Gen-Z] than they have been to anyone between Gen-X and Baby Boomers,” says Nell Minow, vice chair of corporate governance consulting firm ValueEdge Advisors. “If a company wants to attract top talent from the current slate of graduates, they really have got to walk the walk.”

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