Shareholders Versus Stakeholders

Newsweek Magazine

Why They Should Be in Accord To Be Successful

Many business leaders devote a lot of time to making shareholders happy. Happy shareholders are a good thing, of course, but shareholder value shouldn’t be the only goal of a business. Stakeholders matter, too. As an executive business consultant and coach, I believe the more emphasis placed on their concerns the greater benefits for all. Community values are also a consideration as are the employees who make the company run day to day. If leaders want to keep top talent, investment in their health and wellness is key. This includes creating safe work environments.

Shareholders Versus Stakeholders

Shareholders Versus Stakeholders

For too long the main objective motivating companies were the returns of shareholder stock. This is an outdated tactic, yet too many businesses get saddled with this mindset. It can be far better to put stakeholders at the forefront of your thinking.

Stakeholders are more involved in the operation of the business. Employees are stakeholders, too. They’re the boots on the ground and they have put in the time and sweat to keep the company running. Their health and wellness matter.

Business leaders need to recognize this. Those leaders who create safe work environments for employees can have happier, more productive workers as a result. This means paying attention to the indoor environment as much as compensation. Companies that focus on employees and other stakeholders experience more success. In the end, that is what takes care of shareholders.

Business Health Plus Healthy Employees Equals More Productivity

The benefits of focusing on employees over shareholders can be immediate. For example, employers who work toward creating the safest work environment possible prove to employees that they have their best interests in mind. That can provide a boost to morale that bonuses often cannot do. The physical results of working in a safe building also mean employees miss fewer days of work and are more productive while at work.

Based on my past work providing building health services to clients, I’m a firm believer that creating healthy work environments should include creating healthy buildings with improvements in IAQ. This means repairing and maintaining ventilation systems and increasing cleaning and disinfecting efforts. The recent pandemic highlighted the need for healthy buildings and even as the pandemic winds down, these efforts should not. We will face more challenges in the future and business leaders, from CEOs to small business owners with just a handful of employees, must ready themselves to face them.

From senior VPs to building engineers, most employees want to know their employers have their best interests at heart. Of course, this goes beyond investment in healthy buildings. It includes investments in training as well as recognition of both individual and team performance. Team members who feel valued and recognized for their work pass it on to their colleagues and customers. This strengthens the bottom line and that is what takes care of the shareholders.

Invest in Your People, Your Business, and Your Building

The “shareholders-over-all” approach is still embraced by many business leaders, but it’s a mindset that serves very few—least of all shareholders. It’s a relic of a different era and it should be discarded in favor of an approach that values employees first.

This isn’t to say that shareholders don’t matter. They do, absolutely, but shareholder satisfaction is the reward for doing everything else right and that means focusing on the people running the organization every day. Take care of their business health and well-being and everything else falls into place.