How gratitude makes you a better leader

A version of this article originally appeared in Quartz’s Leadership newsletter. Sign up here to receive the latest leadership news and insights straight to your inbox.

A social science and popular culture movement around happiness occurred about 20 years ago, as the field of “positive psychology” was emerging and Harvard was launching its activity. Happiness 101 course.

This phenomenon has grown with the rise of books on the subject, university courses on happiness and well-being, cultural products, media coverage, and overall increased public interest in using “happiness” as a measure of life satisfaction. This irked the Ebenezer Scrooge types, who no doubt found relief as internet chatter and the spread of misinformation steadily increased with the proliferation of smartphones – particularly in the United States, where our reported happiness levels are the lowest since Oxford University began publishing its annual report. World Happiness Report.

Perhaps a simple way to put it is that human motivation mainly boils down to the fact that everyone wants to increase the duration and intensity of feeling good, and decrease the duration and intensity of feeling bad. That’s life in a nutshell.

And all this is to say that as Thanksgiving approaches, gratitude – conscious, intentional gratitude – is a prerequisite for happiness and well-being.

Gratitude doesn’t just affect happiness. In the workplace, this affects performance, where the more specific idea is whether employees feel appreciated by their managers and employers.

• Workplace recognition is a powerful indicator of employee satisfaction and retention.
• Recognition is also correlated with positive business outcomes.
• Gratitude increases prosocial behaviors such as cooperation, sharing, helping others, etc.

How Appreciation Works in the Brain

Dopamine and oxytocin are often referred to as the “happy chemicals” (along with serotonin and endorphins). These are the neurotransmitters and hormones that activate in our brain to produce feelings of pleasure, reward, motivation, social connection and happiness.

Activities such as exercise, social connections, and small rewards like being recognized for good work at work can stimulate these chemicals in a person.

So when one of your employees feels appreciated by you, their brain and body rejoice via these happy chemicals, which tends to make people feel more motivated, want to help more, and feel a sense of belonging to their work team. This helps explain why showing appreciation is correlated with better teamwork, better business results, and longer job retention.

At the same time, there is an element of threat reduction, as humans are quick to protect themselves when they feel judged or ignored. Appreciation reverses this in the best way and signals: You are safe here. Your efforts matter. This is the foundation of psychological safety, a term coined by Amy Edmondson of Harvard Business School, which turns out to be the best indicator of high-performing work teams.

Finally, appreciation teaches the brain what to repeat, because our brains pay attention to rewards. When leaders give specific, timely praise (not lazy, generic praise), it sends a clear signal to the person who did a great job: Do more.

Nearly half of American workers say their boss doesn’t really understand their contribution. This is according to the 2025 Workplace Perception Gap Survey conducted by software and analytics provider The Predictive Index.

The consequence is that workers tend to feel undervalued. Perhaps they aren’t recognized for their contributions, or they feel like they’re being passed over for promotions because their superiors don’t understand the value a particular person can bring, which is more common when there is role ambiguity.

“I’ve really seen firsthand how frustrating it can be when employees feel their efforts aren’t appreciated,” said Anthony Bowers, founder of LMI Waiver, a Sydney-based company that helps Australians get home loans without having to pay mortgage insurance to lenders. “When I was younger, I had the experience of working in an environment where management had difficulty valuing non-revenue-generating positions. This usually led to frustration among employees who performed important tasks but were not recognized during appraisals or performance reviews.”

It’s easy for employee contributions to go unnoticed if there aren’t regular interactions with managers, said Katie Parrish, vice president of content at SkillPath, a nonprofit that focuses on professional development for organizations and individuals.

“This is what you get when you remove middle management,” said Wynter Johnson, founder and CEO of Caily, an organization and tool that helps people navigate the challenges of caring for sick or elderly loved ones.

“[Middle managers] tend to generate a lot of hatred from employees, on the one hand, who view them as intrusive micromanagers; and leaders on the other, who view them as a waste of money, especially in the age of data and AI tools,” Johnson said. “The simple truth is that these are the people who should actually be evaluating, motivating and critiquing employee performance. Good top leaders rightly focus on financial results and broader metrics than each employee’s individual performance, but the people who actually manage people are largely missing from today’s organizational charts.

So, managers and workers, we see you and appreciate you this beautiful Thanksgiving week. I wish you all a happy and safe holiday,