A HR software provider has produced a study revealing the cost of bad company culture: 23.6 billion per year.

The report, The Culture Economy, found a third of British employees quit their jobs due to bad workplace culture.

Despite this, breatheHR – based at Foundry Lane, Horsham – said 60 per cent consider company culture as a “nice to have” in their business.

The survey revealed three quarters of time-strapped SME decision makers are satisfied with their business productivity and one in five don’t measure business productivity at all.

Jonathan Richards, chief executive and founder at breatheHR, said: “Culture isn’t a soft option.

“It has a clear impact not just on business success but on the economy and our society.

“This includes productivity, an area many SMEs struggle with and don’t have the time to dedicate to it.

“However, one way to boost productivity levels is improving management quality and giving employees autonomy and purpose, as our report reveals.

“All validates the fact that businesses are now operating in a culture economy, and small businesses who fail to realise this won’t last long.”

Other key findings of the report:

l Wider impacts of a positive work culture

l Trust in business leaders

l Generational differences

l Engaged and focused Brits.

Mr Richard said: “Our results also uncover a trust epidemic happening across UK businesses.

“Again, this is fuelled by poor workplace cultures plaguing SMEs, resulting in them losing their top talent.

“Although there are many small businesses with fantastic and inspiring cultures, over half of them still don’t value its importance – this is largely due to time constraints.

“As such, we’ve alleviated some of the work by creating a culture plan and recommendations to follow.

“It’s time for those business owners to sit up and pay attention.

“After all, it makes business sense to do so.”

Patrick Woodman, head of research for the Chartered Management Institute, said: “As this timely report shows, a strong, inclusive company culture is essential for long-term business performance.

“The tone is set from the top, so management and leadership play a crucial role and creating the conditions for workers to thrive.

“In particular, transparency and communication are vital for building trust and engendering a sense of purpose among staff.

“The top three things every manager should start to do are share their thinking with their team, admit to their mistakes and uphold their company values.

“Employers must also recognise the pivotal role played by managers at the heart of their organisations, and support and develop them to succeed.”

The Culture Economy report includes an extensive range of evidence on culture and its wider impacts to health and wellbeing, productivity, society, psychology and more.