Human Capital Investment and Its Impact on Firm’s Performance: A Study on Private Commercial Banks in Bangladesh

Abstract

Human capital is important possessions used to achieve a firm’s competitiveness and it is through investment (the commitment of a firm’s fund in human resource development with the hope of generating returns), we can expand it. This study embodies the investment scenario in human capital development made by different private commercial banks of Bangladesh and the impact of the investment on firm’s performance. The researchers have used different HR metrics (Human Capital ROI, Net Profit after Tax per Employee, HR Expense Factor, Organizational Training Cost per Employee, Human Capital Value Added) to measure the impact of human capital investment on a firm’s performance. Finally, the study reveals that investment in human capital development significantly increases a firm’s performance.