Crazy thing is that moves like this also benefit shareholders, albeit indirectly. A company that employees want to work for because they know they'll benefit first means that more and more of the top job seekers will try to work there, which means (indirectly) that the company will have the best of the best employees. As an investor, I would think that in the long term, that's the best use of the company's money and the best path to long-term growth.
I don't want a quarterly, biannual, or annual dividend if that means that that excess capital will be re-invested into better employees (or keeping current top employees) who produce better products which can better position the company in the long run.
For a long time I naively thought that was the whole point of investment: long term sustainability and allocation of capital that allowed companies to best compete.
What you say is true: investing in employees attracts top talent. However, that's only one side of the equation. The other side of the equation is that such policies cost money. So in order to say that this policy is a "benefit to shareholders", you'd need to demonstrate that the benefits outweigh the cost, which is of course impossible to quantify. Over the last 5 years, stock in Mercedes Benz Group is down almost 25%, so I wouldn't say that, generally, Mercedes has been good to shareholders.
Is that the best way to evaluate it? It looks like they also offered about $3-4 dividend each year. The stock is down $5 over the last 5 years, but has also produced almost $15 worth of dividends[0].
For comparison, Ford might be up by about 25% (+$2-3) last 5 years, but it has only yielded a dividend of around $3.
>A company that employees want to work for because they know they'll benefit first means that more and more of the top job seekers will try to work there, which means (indirectly) that the company will have the best of the best employees. As an investor, I would think that in the long term, that's the best use of the company's money and the best path to long-term growth.
This does not work for businesses selling commodified products/services. Walmart can pay top dollar, but it is going to be disastrous because everyone will switch to buying from target/Kroger/Costco/Aldi/Amazon for cheaper.
I don't want a quarterly, biannual, or annual dividend if that means that that excess capital will be re-invested into better employees (or keeping current top employees) who produce better products which can better position the company in the long run.
For a long time I naively thought that was the whole point of investment: long term sustainability and allocation of capital that allowed companies to best compete.