Investing in employees’ happiness delivers shareholder happiness, too. Over the years since Fortune debuted the “100 Best Companies to Work For” in 1998, the publicly-traded companies on the list have consistently and significantly outperformed the overall market. Here’s a look at the stock performance of the 100 Best as compared with the S&P.

The annualized return represents the average annual rate of return for the 100 Best and the S&P from the beginning of 1998 to the end of 2010. The “100 Best” portfolio’s return was calculated by liquidating investments at the end of each year starting in 1998, and reinvesting the proceeds in the new list’s publicly traded companies the following year. This process continues each year through 2010.

The cumulative return represents the total return on investments in the publicly traded companies of the “100 Best” portfolio. Returns are added on a yearly basis for the period 1998 through 2010.

The annual return represents the historical performance of the publicly traded companies on the 2011 list for the previous year. In other words, if you invested in all of the publicly traded companies on the 2011 list at the beginning of 2010, your return would be 23.11% vs. the S&P’s 15.06% at the end of the year.

Source: Russell Investments

Graphic by Sheryl Sulistiawan