The Business Impact of Emotions

Teams watch how their boss responds to volatility.

Leaders are ‘walking mood inductors’.

They literally induce emotions in their direct reports. 

They sense when leaders lose composure under pressure.

Anxiety spreads.

Performance suffers.

A real business impact of a leader’s emotions.

But when leaders remain calm?

The team stays focused. 

They find solutions. 

They maintain perspective.

1: The Business Impact of Leaders’ Emotions

Executive composure matters most during upheaval.

This is what psychoanalyst Wilfred Bion called ‘containment’, where leaders absorb and process team anxiety rather than amplify it.

Steadiness creates psychological safety.

It allows creativity to flourish.

It builds resilience.

When a leader reacts with stress, anxiety spreads across their teams.

Studies highlight a ‘multiplier effect’, where a leader’s emotional state spreads throughout the organisation.

Calm leaders encourage collective creativity and resilience, while anxious leaders diminish the team’s sense of safety and effectiveness.

2: The Responsive Leadership Approach

Many leaders inadvertently respond to crises by mirroring panic and amplifying stress.

At Praesta, we encourage executives to do something different:

1. Recognise their automatic reactions. Create a deliberate pause.

2. Prioritise understanding over immediate action. Gather diverse perspectives.

3. Shift from reactive to intentional. Consider multiple responses, aligned with longer-term purpose.

For example, when faced with a missed revenue target, a reactive leader might demand explanations and assign blame.

A responsive leader creates space for understanding systemic issues, involving the team in solution-finding.

They ask “what can we learn?” before “who’s responsible?”

Even when urgent action is needed, responsive leaders maintain their calm center while addressing the immediate challenge.

3: Building the Responsive Advantage

Our clients practice responsive leadership before crises.

They build habits of calm response during smaller challenges.

They develop practical techniques, like mindfulness practices, structured reflection time, and regular feedback loops to identify emotional triggers.

The result?

They thrive when major organisational change arrives:

• They find opportunities others miss.

• They build momentum while others recover.

• They stay motivated when competitors falter.

Responsive leadership is a competitive advantage in volatile markets.

What’s your default response under pressure?

Do you amplify or absorb the stress?

Please share what has worked for you in the comments.

Your wisdom will help other leaders facing those same challenges today.

This article was originally posted here