In 2023, soft-skills training company Making Business Matter (MBM) conducted a study trying to find where businesses put their focus—people or profit. 

The aim was to find out if organizations that publicly state caring for their employees are telling the truth. They also tried to reveal if companies are really making the proper investment in the development and well-being of their employees.

In the report, the researchers claim that they chose such a particular focus because it hasn’t been done before. Interestingly enough, they are the first to bring these facts to light by looking at publicly available annual reports. 

We were lucky enough to get in contact with Darren A. Smith​​​​, chief executive officer of Making Business Matter, who told Bored Panda, "Our People vs. Profit report analyzed the top 100 global companies’ annual reports and showed that 76 companies mentioned profit words more than people words.

Only 16 companies mentioned more people than profit words. Roche Holdings was #1 with a ratio of 1:0.3, which means that for every people they mention, they only mention profit 0.3 times. At the other end of the scale, #100 was Samsung, which had a ratio of 1:7.1, which means that for every person they mention, they mention profit 7.1 times."

Their main finding was that “85 out of 100 companies focus more on profit than people in their annual reports, even in today’s climate of emphasizing employee happiness.” Well-being and mental issues are some of the aspects that organizations are simply glossing over in their yearly reviews, with 21 businesses not mentioning these keywords in their documents at all.

They also revealed a common disparity between the values that the companies publicly communicate and those their annual report focuses on. “A key example of this is Toyota, which claims ‘Kaizen’ as one of their core values, meaning ‘continuous improvements’, and yet has a total of zero learning mentions,” the study writes.

The main takeaway from this study is quite clear: most businesses agree, at least on the surface, that people are an important asset of any company. However, too few are willing to apply this logic to their policies and daily management. Instead of putting employees and their well-being first, they often look for short-term solutions like slashing labor costs, office expenses, etc.

Businesses that solely focus on the numbers forget that it's the people who make those figures happen. "A ‘numbers business’ becomes very transactional, treating their people like just another resource, and eventually the company loses its reason for being. As Simon Sinek would say, ‘the why’. Why do we do this?

Because money is a way of keeping score, not a reason. Ray Kroc, the founder of McDonald’s, didn’t start because he wanted to make a profit, though it was a welcome bonus, no doubt. He started McDonald’s because he wanted to give the customer a consistent hamburger," says Smith.  

Sadly, many companies have proven that it's possible to have a sustainable business that focuses on profit over people. "Samsung might be a case in point," Smith tells us. "A business such as that will consistently win by having something else. In Samsung’s case, they may not have a focus on people, but they do focus on profit through innovative designs and diversification."

However, "for most businesses, a path of focusing on profit over people is usually a short one because it is the companies that treat their people well, have a people culture, and develop their people, that attract the best people. Not the ones who pay the most, and this is becoming ever more important with the new generations," Smith reassures us.

But there is a way companies can be profitable and compassionate at the same time. In fact, as Smith mentioned, businesses that thrive tend to be the ones that embrace this idea. A Gallup study has found that by prioritizing employee well-being and offering competitive compensation, comprehensive benefits, work-life balance initiatives, growth opportunities, and encouraging open communication, companies can see 21% higher profitability. Other benefits include lower turnover, better customer service, and a reduced risk of safety incidents.

Smith believes that what companies can do to value their staff more is to start by asking for their opinions. "But act on what you receive," he warns. "It’s worse to ask and do nothing than to ask and implement something."

He also adds, "Train line managers to give feedback regularly. Not just ‘well done’ but add the why. ‘You did well today because’. It is the way that makes the difference. If people know what and why they did well, they’ll do more of it."

Lastly, he recommends, "Offer all staff development programs that achieve behavioral changes. Not one-day training courses because they deliver now. Programs that change people’s behaviors for the better."