Strategy & LeadershipHow leadership climate impacts employee well-being

How leadership climate impacts employee well-being

In periods of change, leadership climate is particularly important and has an enormous effect on employee well-being. Jo Maddocks, Chief Psychologist, JCA Global looks at how business leaders and managers can develop their employees to increase engagement levels and employee growth.

A common goal when it comes to improving employee engagement is to increase productivity. But research also shows an intrinsic link between engagement and employee well-being. Jo Maddocks, Chief Psychologist at JCA Global, a PSI business, explains that by improving the Emotional Intelligence of your leaders, it’s possible to increase the engagement levels and well-being of your whole organisation.


Many businesses have stopped employee engagement surveys altogether because they don’t like what they find – and don’t know what to do about it. Other companies dedicate significant resources to their engagement programmes, aiming to attract top talent with increasingly quirky benefits and perks. But despite this, employee job satisfaction has been on the decline for years and stress levels continue to rise.

Free pizza, gym membership and staff discount schemes are clearly not making people happier at work. In fact, they may be doing more harm than good by distracting us from the real issue – when it comes to creating a climate that promotes well-being, leaders need to start by looking at themselves.

Lack of style Recent research by the CIPD shows that nearly two-fifths of UK businesses have experienced an increase in stress related absence over the last year. And the second biggest contributing factor, after heavy workloads, is management style. As a result, the CIPD is calling for increased investment in management training, as well as wider well-being programmes. But it is important for HR teams to see these initiatives as two parts of the same whole.

Because climate starts at the top and trickles down to the rest of the organisation, leadership development should be a major component of any employee well-being programme. By working on key areas of their own Emotional Intelligence (EI), leaders will have a positive impact on employee well-being, growth and engagement levels. This, in turn, creates a positive climate and an emotionally intelligent organisation.

Business benefits

Historically, a key application of EI has been in leadership development. Johnson & Johnson, for example, found that their high performing managers are significantly more ‘emotionally competent’. And a pool of senior leaders at Siemens Global who were trained in EI delivered more than double the additional profit than a comparison group that received no EI training.

It’s worth noting that developing EI has an impact beyond leadership performance, it also delivers results when it comes to output and productivity. L’Oréal sales agents selected on EI outsold salespeople selected through the old recruitment process and had less turnover, and American Express has introduced EI training after finding that trained advisers increased business by 18%.

Different Contexts

Although all aspects of EI relate to improved performance, there are EI attributes that particularly relate to effective leadership. These attributes vary depending on the context and which style of leadership is required. For example, a more coercive style is sometimes necessary in times of crises or when dealing with poor performers. In these situations, it is important for leaders to possess high levels of personal power and goal-directedness, as well as conflict handling skills.

However, when teams are facing stressful situations, or a leader needs to get the most out of their skilled and valued employees, a democratic and coaching style is far more effective. The EI attributes that a leader needs in this context are high regard for and awareness of other people, along with trust and the ability to connect with others. An emotionally intelligent leader will also have the flexibility needed to move between different leadership styles when appropriate – and know when to use, and how to apply each style.

Taking the temperature

The behaviours of a leader are a key factor in determining the emotional climate and tone of an organisation. By evaluating the leadership climate, it’s possible to measure positive leadership behaviours that create a climate of trust and inspire a team, as well as negative behaviours that erode trust, engagement and well-being within an organisation.

Asking employees to rate the behaviours of their leaders builds trust and cultivates a climate which supports a sustainable culture for high performance. And by developing their EI, leaders will be able to replace negative behaviours, such as aggression or competition, with a more encouraging and appreciative style that keeps their people engaged and motivated.

Leadership scales

When it comes to leadership behaviours, how they relate to EI, and how they can be altered or developed, it’s useful to explore four different styles. These fall into two negative and two positive clusters:

1. Controlling

Controlling behaviours can be effective in the short term for mobilising teams in a crisis, but if used habitually they will erode trust and instil fear. Over time, a controlling leader will impede collaboration and innovation. This can be incredibly toxic and will lead to disengagement and burnout.

Negative attributes for controlling leadership

Controlling leaders are competitive and aggressive. They mistrust their colleagues, have low regard for others and can find it difficult to control their emotions. As a result of their inflexibility, these leaders are more likely to be over-optimistic about what can be achieved and more demanding.

2. Withdrawing

Leaders who behave in this way tend to either detach themselves from other people and issues or become over-reliant on others. Their energy levels will be low, leading to a lack of innovation and the absence of healthy challenge. A withdrawing leader spends too much time in their comfort zone.

Negative attributes for withdrawn leadership

When a leader is withdrawn, they may be overly independent and avoid making connections with other people. Alternatively, low self-regard might mean that a leader is over trusting, passive and overly dependent on other people. In either case, a lack of

flexibility, pessimism, and an inability to express emotion are likely to result in highly rigid and defensive behaviours.

3. Inspiring

This type of leader will generate a positive climate where people feel inspired, motivated and challenged to move out of their comfort zones and perform at their best.

Positive attributes for inspirational leadership

To be a visioning and inspiring leader, goal-directedness is essential, but this needs to be combined with a realistic and balanced outlook. A strong sense of personal power, and a belief that you are in charge of and take responsibility for your own actions is also important. Finally, high regard for and awareness of others is vital when it comes to creating a culture of encouragement and support.

4. Inclusive

An inclusive leader will generate trust, loyalty and commitment within their team. This emotional capital can be drawn on to sustain performance and maintain resilience in the face of pressure.

Positive attributes for inclusive leadership

To be truly collaborative, a leader must be flexible and interdependent. By connecting with others and staying authentic, they will build trust within their organisation and create a sense of psychological safety. An appreciative leader will also have high regard for others and be able to exercise emotional expression and control.

How does it feel

Where a leader rates in these four behavioural clusters has an enormous impact on the emotional climate of an organisation. This, in turn, impacts both the engagement levels of their team and the individual well-being of the people within it. Data gathered by exploring the question, “how does it feel to be in this organisation and to be led by this person?” provides a valuable resource for identifying whether a climate is positive or negative. And then implementing appropriate leadership development interventions to address any issues.

Workplace stress is a major challenge for individuals and businesses, and we know that there is a high risk of burnout in organisational climates where people feel threatened, exhausted, disengaged and anxious. By working on their EI, it is possible for leaders to create a working environment where individuals feel energised and motivated. By providing safety, support and space for creative and insightful thinking, leaders will improve their employee well-being – and their teams will be able to fully enjoy the benefits of a game of fuss ball with their colleagues.

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