The influence of company culture on employee wellbeing

The influence of company culture on employee wellbeing

In recent years, much has changed in how we view work. Where salary and secondary employment benefits used to be the most important factors, company culture now also plays a crucial role in how employees feel and perform. And rightly so, because the impact of culture on wellbeing is enormous. As an HR professional, you see it daily: employees who feel valued perform better, are more loyal, and take sick leave less often. Conversely, a toxic work culture can lead to burnouts, high turnover, and structural absenteeism. The question is no longer whether company culture is important, but how you as an organization create a culture that supports employees rather than exhausts them.

Why culture is so decisive for wellbeing

Company culture is more than a collection of values on your website. It’s the daily reality in which employees operate: how people communicate with each other, which behavior is rewarded, how mistakes are handled, and whether people feel safe to voice their opinions. This culture largely determines how employees feel when they go to work in the morning. In a healthy culture, people experience psychological safety, feel heard and valued, and have the sense that their work matters. This leads to more motivation, better performance, and lower absenteeism. In an unhealthy culture, on the other hand, employees feel insecure, undervalued, or constantly under pressure. They don’t dare ask questions, aren’t involved in decisions, and experience poor work-life balance. The consequences? Stress, demotivation, and ultimately dropout due to psychological complaints.

The visible impact on morale and motivation

Morale within an organization is directly linked to the prevailing culture. When employees feel part of a team where trust and respect are central, you see that reflected in their attitude and energy. They’re willing to go the extra mile, think along about improvements, and stay with the organization longer. Motivation doesn’t only arise from external incentives like bonuses or promotions. Intrinsic motivation stems from purpose, autonomy, and the feeling of being competent. A culture that gives employees the space to make their own decisions, that sees mistakes as learning moments, and that stimulates personal development, feeds this intrinsic motivation. Conversely, a culture of micromanagement, unclear expectations, and lack of appreciation can completely evaporate motivation. Employees then no longer feel engaged with the organization and only do what is strictly necessary.

Factors that shape your company culture

Company culture doesn’t arise by chance. It’s the result of conscious and unconscious choices made daily. Leadership plays the most important role in this. The way managers communicate, give feedback, and deal with challenges largely determines the culture of their team and ultimately the entire organization. The structure and processes within your organization also influence the culture. Are decision-making processes transparent? Do employees receive the tools and resources to do their work well? Is there room for feedback and improvement? These seemingly practical matters have a direct impact on how people experience their work. Additionally, the physical and social work environment plays a role. How flexible is the organization regarding working hours and location? Is there investment in team building and mutual connection? Are there opportunities for informal contact? These aspects contribute to how connected employees feel with their colleagues and the organization.

Seven characteristics that make the difference

Research into psychological absenteeism shows that there are specific cultural characteristics that have a protective effect against stress and burnout. A culture where open communication is encouraged ensures that problems are identified and addressed early before they escalate. Organizations that pay attention to workload and set realistic expectations see less dropout due to overload. This doesn’t mean that hard work isn’t allowed, but rather that there is balance and that employees don’t become structurally overburdened. A culture of appreciation and recognition has an enormously positive effect on wellbeing. Employees who feel seen and valued for their contribution experience more job satisfaction and are more resilient to stress. This doesn’t always have to be in grand gestures; often it’s the small daily moments of recognition that make the difference. Psychological safety is another crucial characteristic. In teams where people feel safe to ask questions, admit mistakes, and share new ideas, you see more innovation and less fear and stress. Employees dare to be themselves and don’t have to waste energy hiding insecurities. Development opportunities and autonomy are equally important. When employees feel they can grow and have influence over their own work, they experience more control and purpose. This protects against feelings of powerlessness that can lead to mental exhaustion. The extent to which the organization pays attention to work-life balance also plays a role. Cultures where it’s normal to be reachable after work hours or where overtime is glorified lead to chronic stress and burnout. Finally, there’s the quality of relationships in the workplace. Good collegial relationships and supportive managers function as a buffer against work stress and contribute to job satisfaction and wellbeing.

From insight to action

The beautiful thing about company culture is that it’s influenceable. As an HR professional or manager, you can take concrete steps to create a healthier culture. But where do you start? Start by mapping the current situation. How do employees experience the culture now? What are the strengths and where are the pain points? Employee surveys are a valuable tool for this, provided they are well designed and the results are actually used for improvement. Involve employees in shaping improvements. Imposing cultural change from above rarely works. When teams themselves think along about how they want to collaborate better and what they need to feel good, the chance of sustainable change is much greater. Invest in leadership development. Managers are the carriers of culture and have the greatest influence on how their team members experience work. Train them in conducting good conversations, giving constructive feedback, and creating psychological safety. Make wellbeing discussable and measurable. Integrate it into regular conversations and evaluations. Don’t only monitor hard KPIs like absenteeism figures, but also soft indicators like engagement and job satisfaction. This way you can identify trends before they lead to problems.

The return on a healthy culture

The business case for investing in a healthy company culture is stronger than ever. Organizations with a positive culture see higher retention rates, which leads to lower recruitment and training costs. They perform better because motivated employees are more productive and innovative. Sick leave is also structurally lower in organizations with a healthy culture. This not only saves direct costs, but also the indirect impact on teams that have to cover for colleagues. Dutch companies rate the importance of employee wellbeing an average of 8 on a scale of 10, and that’s not without reason. Additionally, a strong culture has a positive effect on your employer brand. In a tight labor market, that’s an important competitive advantage. Employees who feel good are your best ambassadors and attract similar talent.

The next step for your organization

Company culture and employee wellbeing are inextricably linked. As an organization, you have a choice: let your culture arise by chance, or consciously shape an environment in which people can flourish? The organizations that invest in this see it reflected in better results, more loyal employees, and a healthier work environment. It requires attention, awareness, and sometimes courageous choices, but the return is more than worth it. Start by listening to what’s happening in your organization. Regularly measure how employees experience the culture and their wellbeing. Use those insights to implement targeted improvements. And don’t forget: cultural change is not a project with an end date, but a continuous process of attention and improvement.