As Thanksgiving rolls around, I can’t help but think of all the employees working during the holiday — as I used to be one of them. In the last several years, more and more retailers have extended their holiday hours and chosen to stay open on Thanksgiving day with the assumption that it was good for the bottom line. It turns out this may not even be true — it may be a case of all pain, no gain.
This year, several retailers have gotten good press for closing their doors on Thanksgiving Day, giving their employees the chance to enjoy the holiday. Anyone who’s worked through a holiday can appreciate this gesture, but it might worry some executives or investors concerned about these companies’ bottom lines. However, this decision is not just compassionate, it’s probably good business too.
It seems that companies that invest in their employees’ well being — like closing for the holidays — are more financially successful in the long run than their counterparts. For example, the Parnassus Endeavor Fund, which only invests in companies that offer “outstanding workplaces,” has had annualized returns of 11.38% since its inception in 2005 (as compared to 7.66% from the S&P 500).* It appears that sacrificing the sales made on a single day of the year might not actually be a sacrifice at all in the long run.
This is an example (that I’m especially fond of) of how a decision to “put people first” is a good business decision — a lesson that translates into a relationship driven industry such as wealth management. The best financial advisors have always put their clients’ interests first. They act on the premise that in the long run there is no trade off between their clients’ success and their own — that a good decision for their clients is a good decision for themselves.
So, yes. Doing good can be good business. Happy Thanksgiving.
*The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.