The Employee is Always Right: Employee Satisfaction and Corporate Performance in Brazil

44 Pages Posted: 19 Mar 2019

Date Written: February 12, 2019


I investigate the effect of employee satisfaction on corporate performance based on an extensive dataset of 114,004 online reviews of Brazil’s 1,000 largest listed and unlisted firms from 2013 to 2018 posted at a local subsidiary of Glassdoor. I find that overall employee satisfaction is positively associated with firm performance and that this relationship is likely to be economically relevant. Among the four dimensions of employee well-being, the link with performance is most evident for the dimension on culture, followed by career opportunities. On the other hand, the dimension on compensation and benefits was the least connected with firm performance. Taken together, these results support the view that intrinsic motivators are more relevant for superior performance than extrinsic ones popularized by the “carrot and stick” approach to management. I also find that the influence of employee satisfaction on performance is likely to be asymmetrical, in the sense that workplaces characterized by low satisfaction among workers are more likely to lead to poor performance than best-in-class companies are likely to produce superior performance. To my knowledge, this is the first paper to document a positive link between firm value and employee satisfaction in an emerging economy using online reviews. Because employee well-being is typically one aspect considered in ESG assessments carried out by institutional investors for capital allocation decisions, this paper further contributes to the link between ESG standards and performance by showing that employees’ reviews are a value relevant source of information for investors.

Keywords: employee satisfaction, human capital, corporate culture, intangible assets, online reviews, firm performance

JEL Classification: G30, G32, L20, J28, M14, M54

Suggested Citation

Di Miceli da Silveira, Alexandre, The Employee is Always Right: Employee Satisfaction and Corporate Performance in Brazil (February 12, 2019). Available at SSRN: or

Alexandre Di Miceli da Silveira (Contact Author)

Alvares Penteado School of Business (Fecap) ( email )

Av. Liberdade, 532
São Paulo
+5511945909031 (Phone)


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