25 Apr '12, 12pm

Why valuing your workers as assets makes financial sense

Why valuing your workers as assets makes financial sense

You've heard your CEO say, "Our employees are our greatest asset." But if you've reviewed company financial statements recently, employees are not technically classified as assets -- or valued that way either. In official accounting terms, people are regarded as expenses (i.e. salaries) on the income statement and appear as liabilities (i.e. pensions) on the balance sheet. R. Paul Herman, CEO of HIP Investor , which manages money for investors seeking sustainable portfolios, disagrees with this assessment of a company's employees. When a manager needs to boost performance, he can increase profit by reducing expenses through layoffs. Yet if people were accounted for as assets, they could be less likely to face the ax in a downturn, because managers would invest in their assets that can appreciate in value over time. HIP Investor has uncovered a handful of companies in high-...

Full article: http://www.greenbiz.com/blog/2012/04/25/why-valuing-worke...

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