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What is the value of company’s workforce?

10 November 2015

Professorial Lecture Nov 2015

6pm Wednesday 11 November
Main Lecture Theatre

Ahead of the Professorial Lecture on Wednesday 11 November, Professor Reza Kouhy discusses the value of a company’s workforce.

Tickets are free - book your place now on Eventbrite.

In his Professorial Lecture, Professor Kouhy will talk about the necessity of employee valuation for business sustainability. In his lecture he will talk about his current Dundee Business School research project on human asset valuation.

Competition and sustainability

“Today we are living in such a competitive and correlated economic environment that a wrong financial decision in one business sector or part of the world could easily influence other sectors worldwide.

“The credit crunch, stock market crash, worldwide business problems and rising unemployment rates are clear examples of this highly sensitive and reactive business environment.

“In such an environment, the concept of business sustainability has changed from even ten years ago. In addition to issues such as strategic corporate governance, stockholder engagement and performance measurement, the issue of transparency and disclosure of necessary information is regarded as one of the important factors in relation to business sustainability.”

What are the problems?

“Despite all the interest shown in the concept of human assets as the main component of intellectual capital, organisations to date have failed to recognise their ‘employee value’ within their financial reports, despite all the claims that employees are their most valuable asset. This historical failure has created a cultural system in which employees are treated as a ‘cost’ rather than an ‘asset’.

“Human asset valuation as a strategic and systematic approach can provide useful information for decision making and also assist the management of the organisation in the process of strategic planning for their business sustainability. Despite the potential benefit of human asset valuation, organisations still fail to address and report formally the value of their employees in their financial reporting system.

“One could claim that one reason for companies failing to recognise (i.e. measure and disclose) the value of their employees is the complexity of both accounting and economic models for the measurement of human assets. Most of the models are either not feasible or very complex to be used by companies within their process of value measurement and financial reporting.”

Why do you need to measure this value?

“However, an even more fundamental issue is to ask why monetary measurement of employees, as a companies’ human asset, is necessary. Managers need to be aware of the potential impact of employees’ measurement on both the internal organisational environment and also on external stockholders’ vision.

“Managers need to recognise what an effective role this measurement can play in their managerial decisions, strategic planning and business sustainability models. This awareness can be gained by simply revisiting the nature and the real definition of our organisational assets.”

We look forward to welcoming you to Abertay!

Tickets are free - book your place now on Eventbrite.

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