Leading with Empathy and Why it Matters in Business

In today’s evolving workplace, empathy has emerged as a critical leadership skill, not just for building relationships, but for driving business success.

Empathetic leaders foster trust, boost engagement, reduce conflict, and retain talent. A 2025 review of 42 global studies found that empathetic leadership improves outcomes across performance, wellbeing, and inclusion (Muss, Tüxen & Fürstenau, 2025). Harvard Business Review (2025) now describes empathy as a “non negotiable” for effective leadership, not a soft skill, but a strategic one.

Empathy in leadership is the ability to understand the needs and emotions of others, and respond with care and clarity, while still delivering results. It’s not about avoiding difficult conversations, but approaching them with insight and fairness.

For employers, empathy strengthens psychological safety, staff retention and workplace culture. For employees, it builds trust, improves communication, and supports mental wellbeing. In high pressure industries like logistics, health, engineering and manufacturing, empathy helps leaders manage uncertainty and support performance through change.

Workplaces that invest in empathy see stronger collaboration, fewer interpersonal issues, and faster recovery from disruption.

Empathy is not a buzzword. It’s a capability that can be built and measured. It makes good business sense to develop leaders who listen, connect and respond with insight. As Sanja Zivkovic (2022) notes, “Empathy makes leaders more effective - not less decisive. It is the fuel of inclusive, high performance cultures.”