New research finds an important, and perhaps worrisome, paradox that needs to be on the HR radar: C-suite leaders almost universally recognize the outsized impact empathy in leadership can have on a company’s performance—yet, at the same time, they increasingly acknowledge their organizations have a toxic culture. What’s more, toxic cultures and financial growth are going hand in hand.

“It is a little bit of what you fear,” says Marcy Klipfel, chief engagement officer at Businessolver. “Organizations are running into the trap of empathy being a buzzword instead of woven into the fabric of who they are as an organization.”

The culture challenge

While organizations with toxic, unempathetic cultures aren’t necessarily struggling financially right now, they could be speeding toward what the Businessolver report, based on a survey of about 1,300 employees and executives, labels a “cultural reckoning.”

For instance, employees at such organizations score their companies significantly lower on employee belonging, connection to leaders and peers, trust and more. Those at empathetic organizations report better outcomes and better financial performance.

“Employees will spot that inauthenticity,” Klipfel says. “If you’re just saying [you’re empathetic], but it’s not coming through in how you communicate, how you approach different people practices, if it’s not in the fabric, it falls short.”

HR’s role is to bridge the gap—between C-suite leaders who think they’re leading empathetically and employees who don’t see it coming to life in the day-to-day. It’s a reality that is particularly salient given ongoing AI transformations.

“There has to be a balance,” Klipfel says. “You can’t let AI run wild and straight-up replace the human element. That’s what is so empowering and exciting, to me, about being in human resources and engagement right now; we have the opportunity to bring this all to life from our seat.”

Benefits as a driver of empathy

Benefits is one area in which empathetic leadership can be demonstrated.

Firms like Deloitte and Zoom recently made headlines for trimming benefits offerings, particularly around high-value programs like paid time off and family leave.

Klipfel says HR and benefits leaders today do need to be cognizant of the pressure for cost efficiency; yet, it will be up to the function to drive home to leadership the long-term ROI of empathy in benefits.

Much of that work should be underpinned by understanding your workforce and what their unique needs are.

For instance, at Businessolver, to support the growing share of new parents, the organization rolled out a meal program that helps busy families with a newborn at home. It continues to iterate the offering; based on employee feedback, the meals can be delivered all right after a new baby joins the family or staggered to also include the busy time when the employee returns to work.

“It doesn’t have to be a big [investment] to be thoughtful,” Klipfel says. “It’s about asking the questions, listening and caring.”

A data-driven approach

Engagement surveys are just the start to bridging the perception gap of empathy in the workplace. They have a place but, conduct them frequently, Klipfel advises—Businessolver pulses employees at least every 30 days—and also look at trends around absenteeism, leave, healthcare claims and more.

And, she adds, don’t just pursue feedback from those eager to share it, she adds.

“If you’re engaged enough to tell us how you’re feeling, that’s huge,” Klipfel says. “It’s when people sit there and don’t do the pulse survey, we get worried. If they haven’t pulsed for 30 days or 60 days, that needs to be a reach-out right there.”

Bringing data to the C-suite can help executives face the “cultural reckoning” that is needed to make empathy a reality: Leaders need to see, for instance, that trust, belonging and connection aren’t just “the touchy, feely” aspects of work; they have a real impact on business performance.

“At the end of the day, you need to bring data to show how the business can perform better, how retention can be better,” she says. “If you’re not grounded in data and how [empathy] will propel good business outcomes, it can be difficult to get major decision-makers to pay attention.”

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