Clif Bar climbs to the top of America’s workplaces

September 18, 2014, 11:20 AM UTC
Michele Taylor pick up

Most mornings Clif Bar employee Chris Randall drops his kids off at a bus stop near their home before pedaling off to work. The two-mile bike ride takes 10 minutes of weaving through the streets of Berkeley—a veritable breeze for Randall, who is a long-distance runner. “I like riding my bike from a fitness standpoint, but I also really believe in it as an alternative means of transportation,” the 43-year-old brand manager explains.

The company, which appears on this year’s list of the 25 Best Medium-Size Companies to Work For at No. 12, maintains an employee-friendly philosophy that was in place from the beginning. Twenty-four years ago founder Gary Erickson dreamed up the idea for Clif Bar during a 175-mile bike ride through central California. As he and a friend noshed on bland energy bars, the idea popped into his head. “I could make a better bar than this!” Erickson proposed. What began as a small bakery mushroomed into a private, family-owned business that makes healthy, organic snacks and has become a global brand. Indeed, since expanding beyond its original energy-bar product to other nutritious nibbles and drinks, Clif Bar has reported 20% compound annual growth for the past 10 years.

For Clif Bar management, results are just as important as how its 384 or so employees achieve them—and it puts a particular emphasis on environmental sustainability. In 2001 the company pledged that by 2015 it would have reduced the amount of landfill waste it created every year by 90% with initiatives that reuse, recycle, and compost. The following year Clif Bar introduced new energy-bar cartons that eliminated shrink wrap. (The move saved 90,000 pounds of plastic.) Four years ago Clif Bar opened a new 115,000-square-foot headquarters made from repurposed wood, largely from old barns and railroad tracks. An array of solar panels generates the majority of electricity for its offices and 70% of its heated water.

Great Workplaces Companies with stellar cultures have performed nearly twice as well in the stock market.Graphic Source: Russel Investment Group and Great Places to Work

On top of that, Clif Bar encourages employees to live an eco-friendly life through initiatives like its Cool Car and Cool Home programs: When employees buy a company-approved hybrid, diesel, or electric vehicle, Clif Bar will reimburse them up to $6,500. Bike, walk, or take public transit to work? There’s another $1,500 reimbursed each year. Retrofit that home with solar panels or better-insulated windows? That’s $1,000 back. The company also offers perks that build on one another: Because Randall rides his bike to work most days, he earns virtual points toward services like the onsite chiropractor, whom he can then see free twice a month.

Bikes are a way of life at Clif Bar for Holly Cobbold, left; lunch at Kali’s Kitchen.

Such benefits only hint at the company’s sheer range of health and wellness perks. The onsite cafeteria, Kali’s Kitchen, serves subsidized meals made with local organic ingredients, with complimentary breakfast served every Thursday before the company’s all-hands meeting. An office gym sports a rock-climbing wall, more than 30 free weekly classes—yoga, spinning, and kickboxing, among others—and 2 hours of free personal training a week. “You name it, we’ve either got it or we had it,” says Jennifer Freitas, director of people learning and engagement.

Management’s holistic attitude toward employees extends outside the office too. Every seven years workers become eligible for a six-week paid sabbatical. “Gary realized, ‘If I want to keep employees passionate and engaged, I’ve got to let them go, to make sure they have time to live their lives, have adventures in the world, and come back refreshed,’” offers Freitas. In Randall’s case the 16-year company vet has already taken two sabbaticals. The first time was spent at home with his wife and newborn son. (“We got through those moments of sleep deprivation without having to think, ‘Gosh, I’ve got to go to work teary-eyed, and all of that,’” recalls Randall.) His second paid leave included 17 days in Hawaii and a trip to the East Coast. And even though he has five years to go, Randall is already thinking about the next sabbatical. By then his two sons will be just old enough to car-camp at Yosemite National Park or maybe even backpack through Europe.

Given Clif Bar’s work culture, it’s no wonder that employee turnover remains a low 3% and that competition to land a job is so stiff: Over the past 12 months alone, the company received 7,700 applications from individuals vying for just 114 open positions. For the lucky few who are hired, Randall says working at Clif Bar is a unique experience that’s greater than the sum of its parts. “There are people here I hang with on the weekends,” he says. “We bike ride. We get drinks. I don’t know many other workplaces like that.”

This story is from the October 6, 2014 issue of Fortune.