Although the concept of corporate culture is difficult to define and measure, companies with stronger cultures are generally agreed to be better places to work, and may also have better financial outcomes. In an attempt to begin measuring this intangible asset, we have identified certain workplace factors that we believe can help us identify companies with better workplace environments, which can influence overall corporate behaviours and performance. In this paper we introduce our new tool – the Impax Corporate Culture Indicator – that enables the structural and quantitative assessment of these factors to identify companies well positioned to outperform. Our analysis shows that companies scoring well, as measured by these specific workplace factors, have delivered superior total shareholder returns.
The Impax Corporate Culture Indicator as a tool for alpha generation
Although the concept of corporate culture is difficult to define and measure, companies with stronger cultures are generally agreed to be better places to work, and may also have better financial outcomes. In an attempt to begin measuring this intangible asset, we have identified certain workplace factors that we believe can help us identify companies with better workplace environments, which can influence overall corporate behaviours and performance. In this paper we introduce our new tool – the Impax Corporate Culture Indicator – that enables the structural and quantitative assessment of these factors to identify companies well positioned to outperform. Our analysis shows that companies scoring well, as measured by these specific workplace factors, have delivered superior total shareholder returns.