Why empathic leadership is crucial to business success


There’s a lot of talk about the need for greater empathy in our daily lives. But what is it – and why is empathic leadership in particular be growing in importance?

To start, its important to define what empathy is – especially how it varies from sympathy. Sympathy involves sharing the same feelings as someone, whereas empathy is when you understand the feelings of another even if you don’t necessarily share (or even agree with) those feelings. Essentially, empathy is being able to understand the needs of others as individuals. You put yourself in their position and validate their point of view, whatever your own feelings.


The importance of empathy for leaders

When it comes to leadership, empathic leaders understand the emotional side of their team members’ lives, both inside and outside the office. Having an empathic leadership style is crucial to inclusivity, as it drives a culture of safety and belonging where everyone’s views, experiences, and backgrounds are treated as equally valid.

Employees are looking for more from their jobs – they want recognition, to work for companies that have a purpose that aligns with their own interests, and employers that understand their personal pressures, commitments, and concerns. This is especially true in current challenging economic conditions. Accomplishing this requires empathic leaders who can understand and connect with their team. Empathy and leadership now go hand in hand.


The benefits of empathy in business

At a concrete level empathic leadership delivers multiple benefits. It is at the heart of creating a supportive, no blame, and open culture built on psychological safety that enables innovation and teamwork. Everyone performs better as they feel comfortable in asking for – and receiving – the training and support they need to continually improve. These stronger relationships lead to greater engagement, loyalty, and improve employee retention. In fact, 96% of employees believe showing empathy is an important way to improve employee retention. Statistics from Accenture show that psychological safety leads to 76% greater engagement, 50% higher productivity and 74% less stress for employees.


Empathy is also central to successful transformational leadership and to building trust between managers and their teams. Leadership expert James MacGregor Burns coined the term transformational leadership in 1978 to describe a process where “leaders and their followers help each other to advance to higher levels of morale and motivation.” Transformational leadership motivates employees and gives them more control over their work, delivering greater career satisfaction and commitment, increased retention, higher discretionary effort, and increased well-being. It creates more agile and responsive organizations that can deliver on changing customer and employee needs. We’ve covered transformational leadership and its benefits in more depth in this previous blog.


How do you build empathy in your leaders?

Some people do naturally display higher levels of empathy, just as some show greater emotional intelligence. If you’re worried you aren’t one of them, don’t despair – empathy can be learned and coached as long as leaders are committed to developing the skill, and becoming more empathic, rather than merely paying lip service to the concept.


These five skills and actions support more empathic leadership:


  1. Spend time getting to know your people

Take time to become more familiar with the day-to-day issues that impact individual employees. This will help you understand what motivates them as a person and give perspective into any issues that potentially impact their happiness at work. It’s important to build a holistic understanding that covers their home life too – particularly in today’s hybrid working world.


  1. Be a good listener

Listen with intent to your team members. That means focusing on what they are saying (and not saying) by looking at verbal and non-verbal clues. Show you are actively involved by asking questions to build a deeper understanding and make sure you let them take the lead.


  1. Be inclusive

Inclusive leaders listen and support everyone in their team, whatever their background or experience levels. Be clear that you value everybody’s views and perspective and in team meetings give all employees the chance to speak. Create an environment where all employees feel safe and empowered to share. If you’ve never had the option, consider training on unconscious bias to raise awareness of how your own views might impact your team.


  1. Choose growth over judgment

Show understanding when looking at how people work and perform tasks. That means looking beyond outcomes to try to understand underlying reasons that may be affecting their work. Look at the bigger picture and aim to support growth.


  1. Set a strong example

Levels of empathy as a leadership trait can be continually improved. Seek out and act on 360 degree feedback from all of those you work with. This will give new perspectives on the skills you need to develop as well as demonstrating that you are open to the feedback and perspectives of others. This self-awareness in leadership is critical to improving and deepening your skills.


The link between empathy in a leader and better performance

Successful businesses understand the importance of empathy in leadership, especially post-pandemic and in today’s disrupted times. For example, Grant Thornton’s 2021 International Business Report (IBR) found that 22% of global mid-market leaders cited empathy as amongst the most important factors for success in 2021 and beyond. Empathy in leader creates productive, inclusive, innovative workplaces and teams that outperform the competition and helps retain people for longer. It is therefore vital to ensure that all your leaders, from the top down, recognize its importance. Empathy starts with listening, acting on feedback and improving to build trust, support, and performance, benefiting the business, managers, and their wider teams, making it a central part of your leadership development programs.