The Role of Leadership and Corporate Governance in Employee Retention

Abstract

This has always been one of the greatest questions for every organization: Why do good employees leave? Others believe that it is primarily because of compensation and benefits, lacking independence in their jobs, no more significant opportunities to do what they do best and more. But these are just some of the reasons why great people leave a particular company. According to Gallup research, 75% of the reasons why people quit in their jobs come down to their managers. Marcel Schwantes, the Founder and Chief Human Officer of Leadership from the Core, in his article states that the survey shows that there is one dependent variable that causes employee turnover, and that is the influence of the managers. It is not merely the compensation, or the complexities of the job or the work schedule itself are the primary reasons for such turnover, but these are instead just the fruit of the root: managers who control, own and direct the system are said to be the main culprit. This study aims to determine how leadership and corporate governance directly or indirectly affect employee retention. It will also try to answer what possible models and elements that are applicable to every corporate situation and challenges.