We’ve talked about emotional intelligence (EQ) as an important trait in the modern finance function. It’s more than a trait, really – it’s a skillset, based around your interpersonal skills. While they’re often seen as ‘soft’ skills, they are extremely valuable in both a modern finance function and for transformational leadership.
What is EQ?
The term ‘emotional intelligence’ or ‘emotional quotient’ may have been coined by a graduate student called Wayne Leon Payne, who used the term in his doctoral dissertation. It wasn’t used again until 1990, when university professors John Mayer and Peter Salovey undertook research to measure people’s emotional abilities. They observed that some were better than others at reading other people’s emotions, or even understanding their feelings. One of their papers was titled Emotional Intelligence.
They developed two tests for measuring emotional intelligence, but the term didn’t take off until the writer and consultant Daniel Goleman wrote his book Emotional Intelligence, which was published in 1995. He was criticised by some, including Mayer, for broadening the definition of the term so that it no longer had any scientific meaning. But the book was a bestseller, and Goleman followed it up with Working with Emotional Intelligence in 1998.
Goleman continued to broaden the definition of EQ to include 25 skills, abilities, and competencies. Today, most people stick to five essential elements as outlined in Goleman’s first book, which built on a framework set by Mayera and Salovey:
- Emotional self-awareness: being able to understand what you’re feeling moment to moment, and the impact it might have on others
- Self-regulation: being able to control and direct emotions and anticipate consequences before you act
- Motivation: using your emotions to overcome and persevere in the face of adversity
- Empathy: being able to read other people’s emotions
- Social skills: being able to manage relationships and inspire others
Can it be learned?
There are multiple schools of thought as to whether people can learn EQ. There is a perceived wisdom among business coaches that unlike IQ, which is fixed, EQ is not, and can be learned through training and practice. But is that true?
Several studies have investigated EQ to determine how malleable it is. Tomas Chamorro-Premuzic, a professor of business psychology at University College London and Columbia University summarised many of the salient points in an article for the Harvard Business Review, which found several common factors across multiple studies.
It can be learned – to a point
Our emotions are driven by a multitude of factors, including our upbringing and our genetics. It means that we’re reasonably firm when it comes to our emotional intelligence, and while improving our EQ is not impossible, it will take a great deal of dedication and outside coaching.
Above all, it requires a real desire to change on the part of the individual. There’s also the difference between genuinely changing your EQ and learning to hide your emotions from others. Some people will have an innately higher EQ than others. This doesn’t, however, mean that people can’t change.
EQ naturally increases with age
As you get older, you naturally become more emotionally intelligent. So, the good news is that you’re actually improving all the time. With some greater focus, you can get better, but it’s likely that you’ll need a coach. Good coaches can help people achieve a 25% improvement in their overall EQ without too much issue. Some elements of EQ are easier to improve than others – the social skills element of EQ, for example, often sees the most improvement as a result of coaching. Stress management and self-regulation also see higher levels of improvement.
While empathy is harder to learn, it’s not impossible. Human beings ‘social brains’ are very adaptable and with the right training, people have been able to become more altruistic and compassionate.
But not all coaching methods are created equal. Cognitive Behavioural Therapy (CBT) and a focus on enhancing psychological flexibility have proven to be particularly effective. Self-esteem and confidence boosting exercises are less so.
Some people are also more coachable than others. Willingness to change is a critical factor in having any EQ improvements stick. Ironically, people with higher EQs are better equipped to respond to coaching than those with a low EQ, though they can be the most willing to change.
Accurate, honest feedback is essential
To become more self-aware, you need people to tell you the truth. The majority of people are completely unaware of how others see them, and often over or underestimate their intelligence and social skills. Overestimation is more common – as the Dunning Kruger effect shows, people often believe they’re more competent than they actually are. Good EQ coaching must reveal the real strengths and weaknesses of the individual that wants to improve.
Exercises such as 360-degree feedback can be very effective in revealing some home truths, as are personality tests. Feedback-based coaching tends to encourage managers to seek more advice and improve their performance.
So yes, you can learn EQ, but it’s not easy. It takes considerable effort, plenty of guidance, and some uncomfortable conversations. Stick with it, however, and you can be more considerate, in tune with your team and colleagues, and in tune with your own emotions – some truly valuable skills in the brave new world of the digital finance function.