The research was based on a review of HR literature, case studies and a detailed survey of organisations which was then validated using audited financial statements.

The report concludes that:

• Adopting Investors in People sets up a chain of impact resulting in better financial performance
• This chain starts with adapting policies as a result of adopting Investors in People principles. This leads to greater levels of trust, co-operation and engagement of employees, as well as increasing the flexibility of the workforce enabling the organisation to adapt to change
• Organisations perform better when their employees have clear goals and are supported by HR practices
• Investors in People recognised organisations have greater human capital flexibility. What this means in practice is employees in Investors in People organisations are more able to change their behaviour to cope with changing workplace conditions or practices. This includes a greater willingness to gain new skills, do different jobs and adapt to new ways of working
• Working with the Investors in People Standard has a positive impact on innovation. Organisations that have Investors in People recognition are more likely to have high levels of product and service innovation
• Effective communication has a direct and positive effect on profitability. Investors in People status is shown by the study to have a positive effect on communication within an organisation and therefore an impact on profitability, assessed by profit margin and profit per employee
• The study also finds that the more an organisation embraces Investors in People principles  the stronger the impact on financial performance.

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IIP_Impact_StudyReport_CBP 081029.pdf