Firm Value and Employee Attitudes on Workplace Quality

Abstract

This paper investigates the relation between the value of a firm and employee attitudes on the firm's workplace quality—workplace attitudes. Workplace attitude refers to recognition of those organizational characteristics that enhance employee work experiences and assist employees in balancing their jobs and personal lives. Using inclusion on Fortune's annual list of “The 100 Best Companies to Work for in America” as a proxy for successful efforts in creating high workplace attitudes, we compare the market values of listed firms to the market values of nonlisted firms in the same industry matched on earnings. After controlling for book value, past operational performance, and research and development expense, we find that market values of listed firms exceed those of matched firms. We also provide evidence that firms ranked high on the Fortune list receive higher market values than those ranked lower on the list. Finally, the two-year forward market returns for listed firms exceed the returns for the matched sample while the two-year prior returns are not significantly different between the two groups. This result suggests that market performance does not determine inclusion on the Fortune list.

Building Employee Brand Equity to influence Organization Attractiveness and Firm Performance

“…According to (Ballou et al, 2003;Fulmer et al, 2003) Fortune's 100 best companies have higher market value and better return that matched firm not on the list. Companies ranked in top one third of the list have higher market value than bottom one third of the list (Ballou et al, 2003).…”

“…Companies ranked in top one third of the list have higher market value than bottom one third of the list (Ballou et al, 2003). Fulmer et al (2003) has shown that positive employee relation do lead to better performance (as measured by both accounting and market data: ROA and market-to-book value ratios).Thus being in a list of best employer is a strong marketing or employer branding toll which leads to better attraction and retention in long run (Joyce,2001).…”

Caring as a Managerial Strategy

“…POS has been determined to strengthen affective commitment and increased performance (Eisenberger et al, 2001;Rhoades & Eisenberger, 2002). There is also increasing evidence that the "best" places to work improve organizational performance (Arthur, 2003;Ballou, Godwin, & Shortridge, 2003;Boyle, 2006;Fulmer, Gerhant, & Scott, 2003;B. May, Lau, & Johnson, 1999).…”

Impact of Internal Branding (IB), Brand Commitment (BC) and Brand Supporting Behavior (BSB) on Organizational Attractiveness (OA) and Firm Performance(FP)

“…Companies included on Fortune's 100 best companies list have higher market values and better return than matched firm not included on the list (Ballou et al, 2003;Fulmer et al, 2003). The market values of firm ranked in top one third of the list were higher than firms ranked in the bottom one third of the list (Ballou et al, 2003).…”

“…The market values of firm ranked in top one third of the list were higher than firms ranked in the bottom one third of the list (Ballou et al, 2003). Fulmer et al, (2003) showed that positive employee relation are beneficial for companies and may be related to improved performance (as measured by both accounting and market data: ROA and market-to-book value ratios).…”