Treat your employees or the trick is on you
: performance evidence from european firms

  • António Rui Torres de Araújo (Student)

Student thesis: Master's Thesis


The link between employee satisfaction and performance has been predominantly discussed in recent years through the scope of market returns. However, the underlying mechanisms of such link still remain widely indefinite at an operational level. Do Companies with high levels of employee satisfaction develop superior mechanisms of operational value creation? This thesis addresses the operational performance of 125 companies that ranked consistently in the “Best Companies to Work For” list in 15 European Countries from 2003-2011, by benchmarking their performance measures against a geographical- and industry- and size-matched peer group. It unveils the superior operational performance of companies with outstanding employee relations in a cross-country and cross-time analysis. We find that “Best Companies to Work For” enjoy significant abnormal operational performance both in an economic growth period (2003-2007) and during the recession (2008-2011). The study unveils that the superior operational performance is driven by a greater efficiency in cost managing and capital utilization that overcompensates higher costs related with wages. This project management efficiency is obtained regardless of differences in the capital structure such as lower debt levels, introducing job satisfaction as a complimentary mechanism to the disciplinary role of debt.
Date of Award2013
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorChristophe Moussu (Supervisor)


  • Employee satisfaction
  • Operational performance
  • European market
  • Capital structure


  • Mestrado em Gestão

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