Key Points

• Investors and analysts are beginning to press CEOs on how they are using and optimizing their human capital, the asset that most CEOs understand the least. Those who have a good story to tell will find an attentive ear in those audiences. In turn, they should ask tough questions of their function leaders, especially HR and finance, regarding how human capital is being managed and with what effect.

• Finance is taking on a larger role in strategic human capital decisions. Although financial executives were not able to assess returns on human capital investments in the past, techniques for doing that with clarity and precision are now available.