One person who may have the answer is Jerome Dodson, the founder in 1984 of Parnassus Investments. Since April 2005, Dodson has held the additional role of portfolio manager for the Parnassus Workplace Fund, a mutual fund that invests exclusively in large American firms proven to have outstanding workplaces.
To Dodson--and Moskowitz’s--delight, the Parnassus Workplace Fund proved immediately, enormously, and enduringly successful. Since the fund’s inception (April 2005-January 2013) it’s had a 9.63% annualized return. This compares to the S&P Index which has earned just 5.58% during the same period. “Our fund has had returns over 4% better than the S&P Index every year,” Dodson noted. “Eight years later, the performance of the fund confirms what I’ve always believed. Treating people well and authentically respecting them does lead to far better business performance. We proved it works.”