Emotional intelligence (commonly abbreviated as “EQ”, for emotional quotient) is the ability to perceive, control, and evaluate emotions, both in oneself and in others. The concept emerged from research into social intelligence in the 1930s, and from work in the 1970s on different forms of intelligence. In the 1990s, US psychologist Daniel Goleman published the highly influential Emotional Intelligence: Why it Can Matter More Than IQ. In the book he identified the five “domains” of emotional intelligence: knowing your emotions; managing your emotions; motivating yourself; recognizing and understanding other people’s emotions; and managing relationships.

Goleman pinpoints high EQ as a common trait among effective business leaders. Without emotional intelligence, he argues, a leader can have limitless energy and ideas, a perceptive and logical mind, and impressive qualifications, but still be ineffective and uninspiring. Goleman cites Bob Mulholland, head of client relations at Merrill Lynch during the 9/11 attacks, as a leader with high EQ. After his staffsaw a plane hit the twin building opposite their own, they began to panic—some ran from window to window, and others were paralyzed with fear. His first response was to “unfreeze” their panic by addressing each of their concerns individually. He then calmly told them that they were all going to leave the building, via the stairs, and that they all had time to get out. He remained calm and decisive, but did not minimize people’s emotional responses. All his staff escaped without injury. This was a rare and unusual context, but Mulholland’s approach shows the value of EQ in managing staff in any form of volatile situation.

Goleman suggests that high EQ facilitates other essential leadership traits. For example, the ability to recognize accurately what another person is feeling (empathy) enables one to manage that feeling and any behaviors that arise from it.

One persistent debate within the business world is whether leaders are born or made. Goleman suggests that the answer is both: inherent personality traits are important in leadership, but EQ—which grows with age, experience, and self- reflectiveness—is just as important. Today, the development of EQ lies at the heart of leadership coaching. New and aspiring leaders are mentored by experienced ones; together, they discuss past and future scenarios, various possible responses, and what the emotional trigger points might be. This procedure seeks to increase emotional maturity. A 1999 study showed that partners in a multinational consulting company who scored highly on EQ delivered $1.2 million more profit than other partners. Other studies have shown similar correlations between EQ and effectiveness. Emotional balance, it seems, is a key factor in commercial success.