Decision-making is led by emotion

What is our investment strategy for 2021?

How shall we communicate this difficult message to our customers?

What shall I have for dinner?


Every decision we make, every problem we face and then determine a course of action is influenced by our feelings.


It was Antonio Damasio, a neuroscientists from the University of Southern California who said,


“Emotion is not just necessary for wisdom; it’s also irrevocably woven into the fabric of every decision we make.”


It was only as recently as 1990 that emotional intelligence was brought into the mainstream of science. Prior to that it was IQ that dominated the literature.


As the research emerges, we are beginning to realise that the emotions we feel hugely influence the risks we are prepared to take. If we are feeling joyful or happy we tend to make decisions that carry more risk because we’re optimistic about the future and when we are feeling low or unhappy the opposite happens. This is significant in all of our organisations as well as our own personal lives.


In business, we have developed this view that emotions cloud our judgement when the reality is in fact that emotions can drive better decision-making. The important aspect here is not whether or not we feel emotion, but whether we have the awareness, the recognition and the ability to regulate these emotions. This is what determines the quality of our decision-making.


Most would acknowledge that decision making is one of the founding elements of governance.


So, if we are to move towards better governance, we need to look really hard at the things that influence our decision-making.

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