Companies rely on capital to create value. These include human capital, financial capital, and environmental capital.

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Capital refers to the factors that enable companies to generate income,higher company stock prices,economic value,strong positive brand identity,and reputation.There is a variety of capital that companies use to create value,including financial capital (cash)and capital equipment (state-of-the-art robotics used in manufacturing)and human capital.Employees represent a specific type of capital called human capital.Human capital,as defined by economists,refers to sets of collective skills,knowledge,and ability that employees can apply to create value for their employers.Companies purchase the use of human capital by paying employees an hourly wage,salary,or bonuses and providing benefits such as paid vacation and health insurance.Also,companies help develop human capital to their advantage by offering training programs aimed at further boosting employee productivity.

Companies Rely on Capital to Create Value