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Nov 09
Jakoba_Blog_Investors Finally Taking Notice of Human Capital

Investors Finally Taking Notice of Human Capital

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November 09, 2015

Of all assets, the most nebulous and difficult to evaluate is perhaps the most important of all: human capital. Employees and the quality of leadership are what make or break a company, and investors realize it. Until recently, the lack of adequate human capital reporting made human capital management more art than science. Because investors tend to put more stock in objective data than subjective analysis, many companies didn’t strive to report and monitor their employees. If they did, the information rarely left HR. That’s beginning to change, however.

HR Reporting Becoming Pivotal in Valuation

Two disparate and distinct sections of the corporate world are getting acquainted: HR and investors. Companies include their human capital management abilities in presentations to investors. Why? Many companies have recognized the need to show investors that their success is a result of ethical, sustainable practices. To maintain trust, transparency is now more important than ever.

Jakoba_Blog_Investors Finally Taking Notice of Human Capital

 SRI Going Mainstream?

Socially responsible investing used to be heralded by a select group of companies, including environmental and governmental entities. Today it’s becoming mainstream. A thought leader idea says a company gets the shareholders it deserves. By highlighting ethical strengths—both in how you invest assets and how you treat employees—you give investors greater confidence in taking a chance on your enterprise.

The Challenge of Valuing Human Capital

As we mentioned earlier, the historical challenge of human capital management has been the lack of adequate human capital reporting methods. What it boils down to is this: there remains no way to value objectively the quality of a person. Companies have had to rely on narrative power to highlight the value of their human capital.

Looking Beyond Metrics

Any attempt at reducing the value of human capital to a set of numbers is bound to fail. What you can do, however, is look beyond the metrics and think about how the value of employees contribute to meeting goals. Thinking about human capital in this way could have companies produce different, original metrics based on what they’re trying to measure and achieve. That’s where Jakoba comes in.

Working with Jakoba

Jakoba works with HR and management to meet HCM goals. As investors take note of human resources management, having top-notch human capital solutions seem more necessary than ever. We help companies measure employee performance, meet goals, and automate the performance review process. For more detailed information on our services, please visit our homepage.

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