Emotional intelligence is the key to more successful entrepreneurs

Canada has one of the highest levels of entrepreneurial activity among developed nations and was recently ranked the best in the world for social entrepreneurship. (Pexels Photo)

Entrepreneurs have a key role to play in achieving the United Nations 2030 Agenda for Sustainable Development. This action plan, which has been adopted by all UN member countries, including Canada, was created to tackle today’s “most pressing social, economic and environmental challenges.”

While governments play a central role in achieving these goals, non- and for-profit organizations can accelerate this progress through innovation. That is where entrepreneurs — anyone who starts or owns a business — come into the picture.

Canada has one of the highest levels of entrepreneurial activity among developed nations and was recently ranked the best in the world for social entrepreneurship. Social entrepreneurship focuses on addressing social issues such as poverty, illiteracy and discrimination.

To maintain its position as an entrepreneurial nation, Canada must continue to foster innovation. Our recent research on how emotional intelligence at the societal level impacts entrepreneurship can help Canada, and other nations, accomplish this.

About the study

Using entrepreneurial activity data from the Global Entrepreneurship Monitor in 24 countries, our study found that entrepreneurship flourishes when individuals in society possess higher levels of well-being, adaptability, self-control and sociability.

These are characteristics of societal emotional intelligence — a measure of the collective emotional intelligence of a particular society. Emotional intelligence refers to the ability of an individual to recognize and understand their own emotions, as well as the emotions of others, and use this knowledge to make decisions.

At the societal level, emotional intelligence plays a vital role in addressing challenges present at different stages of the entrepreneurial process, such as idea generation, planning the launch, and growth of an enterprise.

However, the degree to which each characteristic of emotional intelligence impacts entrepreneurship depends on the type of entrepreneurship.

Fostering commercial entrepreneurship

Our research found three characteristics of societal emotional intelligence are more likely to foster commercial entrepreneurship: hedonic well-being, adaptability and self-control. Commercial entrepreneurship leads to innovation that contributes to a country’s economic growth by generating wealth.

1. Hedonic well-being

Hedonic well-being is one of two types of perceived well-being. It refers to an individual’s perception of their own life satisfaction, happiness, optimism and self-esteem.

Hedonic well-being can help individuals navigate challenging situations that arise when working as an entrepreneur by providing them with a sense of control over their situation.

Individuals with high levels of hedonic well-being are more likely to have characteristics associated with successful commercial entrepreneurs.

2. Adaptability

Individuals with high levels of adaptability are open to new information, willing to let go of preconceived notions and capable of adjusting to new or challenging situations.

An individual’s ability to adapt in the face of adversity sets them apart as exceptional. Individuals that are very successful often possess higher levels of adaptability.

In the context of commercial entrepreneurship, having a high degree of adaptability allows entrepreneurs to navigate uncertainty and adapt to changes in the business environment.

3. Self-control

Self-control is a mental process that helps individuals align their thoughts and behaviours with their goals, particularly during periods of adversity.

Self-control is beneficial for commercial entrepreneurs, as it encourages them to be mindful of the strategies needed to keep their goals in line with the ever-changing business environment.

Because self-control is valuable for managing commercial enterprises, societies that have more individuals with higher levels of self-control are more likely to facilitate commercial entrepreneurship.

Fostering social entrepreneurship

Our research found two characteristics of societal emotional intelligence are more likely to foster social entrepreneurship: eudaimonic well-being and sociability. Social entrepreneurship, as previously mentioned, leads to innovation that addresses social issues.

1. Eudaimonic well-being

Eudaimonic well-being refers to an individual’s perceived autonomy, self-acceptance, sense of purpose and ability to manage their environment.

The characteristics associated with eudaimonic well-being motivate individuals to make greater contributions to the welfare of others through social entrepreneurship.

While the characteristics of eudaimonic well-being are essential for both types of entrepreneurship, societies with higher levels of eudaimonic well-being tend to foster an environment more conducive for social entrepreneurship.

2. Sociability

The American Psychological Association defines sociability as the tendency “to seek out companionship, engage in interpersonal relations, and participate in social activities.”

Sociability has three facets: social awareness, emotional management and assertiveness. It plays a more significant role in social entrepreneurship, so societies with a larger amount of individuals with this trait are more likely to facilitate social entrepreneurship.

Fostering emotional intelligence

Entrepreneurship in Canada, both commercial and social, needs to flourish to help the country meet its sustainable development goals. For this to happen, Canada should implement strategies to build emotional intelligence among its entrepreneurs.

One way Canada could do this is by investing in programs to monitor, assess and diagnose ways to improve emotional intelligence among entrepreneurs.

In addition, given that emotional intelligence can be developed with training, businesses and innovation hubs should develop emotional competencies among their entrepreneurs.

Finally, Canada should implement education curriculum focused on developing emotional intelligence in students to shape their entrepreneurial behaviours. By equipping students with emotional intelligence skills, Canada will nurture a generation of entrepreneurs ready to create wealth, tackle social challenges and create positive change.

Etayankara Muralidharan, Associate Professor and Chair of the Department of International Business, Marketing, Strategy & Law, MacEwan University and Saurav Pathak, Associate Professor, Raymond A. Mason School of Business, William & Mary

This article is republished from The Conversation under a Creative Commons license. Read the original article.