Do you practice empathy in your business? Empathy could be more important than you might imagine. Studies have shown employees who are more empathetic are less likely to lie or steal from their employers. And that CEOs who have higher emotional intelligence (aka empathy) are less likely to be involved in financial scandals.

Imagine a world where the executives at Enron and Theranos had more empathy. Those companies might still exist, and all those employees and shareholders could be loving the retired life–rather than serving as a cautionary tale.

In business, soft skills like empathy are often overlooked in preference of hard skills. However, having empathy results in more ethical behavior of leaders and employees alike.

As an attorney, law professor, and talent agent, I’m passionate about business ethics. I advise clients and companies on how to create ethical cultures, and I even teach an ethics class on LinkedIn.

Here is how I teach companies to practice empathy to improve their ethical outcomes.

What is empathy?

Before we talk about how to practice empathy, it’s important to understand what empathy is–and is not.

Empathy is your ability to understand and share the feelings of others. It is not sympathy, which is feeling sorry for someone. Empathy is the ability to imagine yourself in someone else’s shoes.

For example, when an employee has a death in the family. Instead of feeling sorry for the person, sending a card, and moving on an empathetic person might imagine how difficult it is to deal with the loss of a loved one.

An empathetic person might imagine how it would affect their colleague’s focus and behavior at work. And if you were their boss, you might ask how they were doing and offer support services to get them through this tough time.

Why is empathy important for business?

Empathy is important in business because it strengthens your ethical decision-making while improving your business outcomes. When you use your empathy, you are better able to identify stakeholders, understand impacts, and promote fairness in your business.

For example, when you identify stakeholders, you can recognize who and what is affected by your choices, from your employees to your customers to your environment. By understanding impacts, you can anticipate the potential consequences of your decisions for various stakeholders, helping avoid unintended harm–both financial and environmental. Finally, empathy helps promote fairness in your business by considering the needs of everyone involved, fostering a more equitable outcome for all.

So, what does this mean in practice?

Imagine your company is considering a cost-cutting measure that involves outsourcing jobs overseas.

By practicing empathy, you would be able to

• Consider the impact on employees, who might lose their jobs.

• Understand the potential economic hardship those employees might face.

• Seek alternative solutions that minimize the negative impact on those employees.

How to practice empathy.

Here are three strategies I teach for integrating empathy into your daily business practices.

1. Use active listening. Seek to understand the perspectives of those who might be affected by business decisions–before making the decision. It can help prevent or mitigate impacts.

2. Consider the long term. Many businesses are focused on short-term thinking–how to get profit each quarter. However, what’s good in the short term might not be good for the long term. When you consider the long-term consequences (and relationships), think beyond immediate benefits and consider the impact of your choices down the line.

3. Finally, use role-play. When facing a difficult decision, simulate different scenarios with your colleagues and consider how others might react.

By practicing these empathetic strategies, your company can make more informed, responsible choices with more ethical and positive outcomes for everyone involved.

How are you using empathy at work? I would love to hear from you.

This article was initially published by Inc Magazine Nov 6, 2024.