Home Emerging Ideas Exploring Organizational Psychology Trends in Human and Organizational Resources Management From Transactions to Transformations: Emotional Capital in Modern Corporations

From Transactions to Transformations: Emotional Capital in Modern Corporations

April 15, 2025

By Ishika Choudhary, Supervision by Dr. Anna Rostomyan

As Daniel Goleman correctly states, “What really matters for success, character, happiness, and lifelong achievements is a definite set of emotional skills—your EQ—not just purely cognitive abilities that are measured by conventional IQ tests(1995).” In an era where emotional intelligence is widely recognised as a vital driver of personal and professional success, the notion of emotional capital has evolved as a useful framework for comprehending the role of emotions in developing human and organisational potential. Emotional capital is the collection of emotional competences, skills, and assets that individuals and organisations can use to overcome obstacles, create collaboration, and achieve long-term success. Emotional capital, which is based on the broader concept of emotional intelligence, encompasses the collective emotional resources of teams, communities, and organisations. These resources—empathy, resilience, emotional regulation, and interpersonal skills—are critical in building environments that foster trust, innovation, and wellbeing. Emotional capital is the storehouse that holds positive emotions, emotional intelligence, and trust that individuals or organisations cultivate and invest in relationships. It has a significant impact on personal success, leadership effectiveness, and team relationships by increasing resilience, collaboration, and innovation. Individuals and organisations may nurture emotional capital by developing settings of empathy, connection, and mutual respect, all of which are necessary for long-term growth and well-being.

This paper explores the multifaceted nature of emotional capital, examining its theoretical foundations, its relationship to emotional intelligence, and its implications for leadership, organizational culture, and employee engagement. By shedding light on the strategic value of emotional capital, this study intends to contribute to the expanding discussion about the relationship between emotions and success in modern contexts.

Literature review

Cognitive theorists developed a positive link between emotions and cognition, implying that emotions are influenced by personal interpretations or appraisals of events. A paper Review of Emotional Intelligence by N. Gayathri and Dr. K. Meenakshi(2013) states that the change from perceiving emotions as disruptive to acknowledging their function in cognition. By using theories such as Daniel Goleman’s EI Framework, Appraisal Theories of Emotion, Maslow’s hierarchy of needs they emphasize the importance of understanding the interplay between emotion and cognition in shaping human behavior.

Another recently published paper by Mateusz Brodowicz(2024) talks about the Humanistic theory by Abraham Maslow and Carl Rogers. It delves into Maslow’s Hierarchy of needs, which describes a development from basic physiological demands to self-actualization, as well as Rogers’ Person-centred Therapy, which emphasises empathy, unconditional positive regard, and congruence in therapeutic settings. The paper also contrasts their theories, emphasising both parallels and differences, and discusses their long-term impact on current psychology.

Shuet Ching Neong, Zaleha Md Isa, and Mohd Rizal Bin Haji Abdul Manaf examines the relationship between emotional intelligence (EI) and organisational culture by systematically reviewing existing literature on the association between EI and organisational culture.The authors conducted the review from Web of Science (WoS) and Scopus databases and found Three primary themes emerged linking EI and organisational culture: Leadership, Knowledge Dissemination and Decision making. Which suggested that EI contributes to effective leadership, knowledge dissemination, and decision-making, all of which are integral to a positive organisational culture.

Gardner’s Theory of Multiple Intelligences which was introduced in 1983 was studied by Maslo.I.M. explores Howard Gardner’s proposition that intelligence is not a single, monolithic ability but a composite of multiple distinct intelligences. The article underscores the transformative potential of applying Gardner’s Theory of Multiple Intelligences in the learning process. It is recognized through “intrapersonal intelligence,” which involves understanding one’s inner feelings, motivations and Emotional Processing is Indicated through how self-knowledge can influence broader emotional understanding and decision-making. By embracing this multifaceted view of intelligence, educators can create more dynamic, responsive, and effective educational experiences that recognize and develop the full spectrum of human capabilities.

The paper “Emotional Intelligence: Theory, Findings, and Implications” by John D. Mayer, Peter Salovey, and David R. Caruso establishes a fundamental framework for comprehending emotional intelligence as a standard intelligence. Their findings emphasise the importance of EI in numerous facets of human functioning, as well as the potential benefits of acquiring EI abilities to promote both professional and personal growth.

Methodology

Upon researching on the topics, going through numerous papers related to the topic and conducting a survey. This study adopts a mix of qualitative and quantitative research approaches to explore in depth knowledge on emotional capital in today’s organisations. This design was selected to ensure a comprehensive understanding of emotional intelligence, balancing the knowledge about self awareness, awareness towards emotional intelligence and emotional capital in workplaces to increase the reliability of the survey and research.

The study was conducted with employees working in corporate offices across Asia, America and Germany. Participants were selected keeping in mind their employment status and years of experience ensuring a representative sample. The final sample included people of backgrounds ranging from IT, sales, marketing and HR. Data was gathered using Surveys over a time period of one month and research papers.

Data Analysis

Self-awareness, trust, organisation, and emotional intelligence were among the topics covered in the questions. According to the survey, respondents understood the meaning of emotional intelligence and were capable of managing their own emotions, but the scales fell to specific levels when it came to trust and companies. Another thing to note is that, when asked if they thought that investing in emotional intelligence would enhance organisational performance, the majority of women “yes,” whereas the majority of men gave “maybe” answers.

1st graph

The majority of responses to the inquiry, “Are emotions considered a strength or weakness in your workplace?” were either neutral or negative, indicating that organisations still need to improve their internal culture in order to make a positive shift in the years to come.

While those in the IT and tech sectors struggled to stabilise their responses in support of their organisations being empathetic towards their emotions, those in the marketing, design, HR, and consulting sectors were significantly more satisfied and aware of their company’s and managers’ efforts and policies towards reducing burnout and promoting the culture of empathy and respect.

2nd graph

Additionally, we can see that companies fail to equip their staff with the necessary tools for managing stress at work. Which can be easily handled by training and workshops, access to resources and creating a supportive culture among many other possible ways.

3rd graph

Overall scores indicate that individuals with higher emotional awareness frequently reflect on how their emotions affect their decision-making. This highlights the importance of emotional introspection in enhancing self-regulation and control. Respondents who prioritize understanding others’ emotions tend to foster trust and serve as emotional anchors within their teams. This aligns with psychological theories suggesting empathy is a cornerstone of effective communication and leadership.

We also notice that in the question targeting an important emotional skill for the leader to have, “EMPATHY” was a term highly used in the responses. The responses on workplace emotional culture, such as “Are emotions seen as a strength or weakness?” and “Does the organization address emotional challenges?” reveal varied perceptions of emotional support at work, reflecting potential gaps in emotional intelligence training or organizational empathy.

Open-ended responses frequently mention “empathy” and “trust building” as critical emotional skills for leaders. This aligns with psychological models advocating that emotional intelligence in leadership drives team cohesion, resilience, and performance.

Data linking stress management and motivation underscores the psychological impact of organizational support structures. A well-managed emotional environment positively influences motivation and performance, a key finding in organizational psychology.

Many respondents highlight infrequent emotional intelligence training. This indicates a potential area for organizations to strengthen, as training equips employees to manage stress, empathize, and build better interpersonal relationships. Certain steps can be taken to ensure a hospitable empathetic environment for the employees to settle and work in, one of them being Fostering open communication by establishing clear channels for feedback and dialogue, ensuring employees feel heard and valued, by training leaders and managers to practice active listening, showing empathy and understanding in interactions and also by conduct one-on-one

meetings to discuss not only work performance but also personal challenges and needs.

Another one can be Promoting Emotional Intelligence in the workplace by providing EI training for leaders to enhance empathy, emotional regulation, and interpersonal skills and through offering workshops on self-awareness, conflict resolution, and emotional resilience. Also, by prioritising Mental Health and Well-being of the employees it can be made sure that the employees are provided with resources such as Employee Assistance Programs (EAPs), counseling services, and stress management workshops. Allowance of flexibility in schedules to accommodate personal needs and reduce burnout. Encouragement of taking breaks, vacations, and setting boundaries between work and personal time can really enhance one’s experience of working in an organisation also keeping in mind to Monitor and adapt policies from time to time, encouraging employees to voice opinions and problems, nurturing a comfortable physical and virtual space and training managers in empathy and leadership can shape employee’s well being and experience to a much more positive sphere.

Conclusion

In conclusion, this study highlights the significance of Emotional capital and its importance in workplaces. The research provides a deeper understanding of how improved or better emotional intelligence can create a better working environment, contributing valuable insights to the existing body of knowledge.

The findings underscore the importance of theories such as Emotional intelligence theory by John D. Mayer, Peter Salovey, and David R. Caruso, suggesting EI in various aspects of human functioning and highlights the potential benefits of developing EI skills to foster personal and professional growth which can also be seen in the data analysis where participants’ self awareness of emotions has helped them work better and comfortably in their workplaces and how their emotions are interrelated with their peers trusting them and approaching them for advice in a workplace. Daniel Goleman’s emotional intelligence framework which focuses on Empathy enhancing communication by fostering active listening and meaningful exchanges, which are essential for conflict resolution and collaboration was also a theory targeted in most answers of the survey. For instance, Upon asking what changes they would bring into their companies, empathy was a term most applied. This emphasizes the need for Emotional Intelligence in workspaces, which could lead to improved outcomes for not only the employees but also for the employers as a comfortable working environment will lead to an increased productivity and better returns.

Despite its contributions, the study acknowledges certain limitations, including awareness issues, difference in opinion, general and personal biases and external influences. Addressing these in future research could further refine and expand upon the findings, enabling a more comprehensive exploration of emotional capital.

Ultimately, this research underscores the potential of Emotional capital and its dire need in workplaces to benefit without compromising the employees well being and mental health. By addressing topics similar to Emotional Intelligence in work spaces, surface issues can be deeply addressed and a better approach can be taken whenever required. By continuing to explore this area, researchers and practitioners alike can drive meaningful progress in Emotional Capital and how it represents the evolution of emotional intelligence (EI) concepts into a broader framework that emphasizes the availability of emotional resources as a critical driver of organizational and societal success.

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