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Building a Strong Business Takes Compassion

Sean: Hey guys, welcome back to the show. Today on the leadership stack, we have Mr. Bruno Cignacco and guess what, he is all the way from Italy. And this is the first time we have a guest from Italy actually. So I’m very excited to have him on the show. And the things that you’re going to be learning today are very different from what we’ve had in the past guestings; it’s all about compassion.

Now, how does compassion tie up to leadership? How does compassion tie up to entrepreneurship? How does it tie up to management, to your bottom line? That’s what we’re going to be learning today. Dr. Bruno, thank you so much for being here on the show. We are honored to have you here.

Bruno: Thank you for your invite. I’m very honored. Thank you .

Sean: What we want to know, at the very beginning – and this is what actually makes the show so interesting to a lot of listeners. When we watch superhero movies, the first movie is usually the best one, the history of how they became a superhero. And that’s actually, what do we want to know with you?

Tell us about your entrepreneurial journey. Your profile, your bio is amazing. You’re a TEDx speaker, you’ve written so many books, you’re consulting for so many clients. What was it like getting to where you are today as a human oriented training consultant?

Bruno: Thank you for the question. It is a very insightful question.

I want to comment about my beginning. My starting point was approximately 25, 27 years ago. I studied as an accountant. Worked in an accountant studio and also doing the traditional accounting advisory, such as tax budgeting, costing, and all this. But then I turned into international trade, international marketing –  international trade.

Which implies import-export  activities. This was a traditional advisory to consultancy on how to enter new markets, how to penetrate different markets worldwide, and also how to import gold for another countries. And I did this for many years. This was very traditional advisory –  traditional consultancy services.

And also, what I did is also develop international marketing strategies that could help companies, even small, medium size companies to enter different foreign markets. But over time, I started noticing that companies were only money oriented, only profit focused, only oriented to the bottom line, which means profits.

And they were not acting in a very humane or human oriented way. This means, for example, caring for employees, or caring for suppliers, or caring for the community members, or even caring for customers. So they were focusing only on a business aspect of their transaction. They were not focusing on the human aspect of their transaction.

So then a while ago I read an article titled, “The Human Moment at Work” published in Harvard Business Review, and this got my attention. And I observed that the author of this article commented about human moments, about technology – how technology hinders the communication between different employees. Because they don’t allow, this communication doesn’t allow these employees to connect on a mental and emotional level.

And I was really intrigued. And I also notice that many companies, many new companies or new generations of companies were acting both  in a compassionate way and in a profitable way, some examples are ‘Whole Foods’ or ‘Lush Cosmetic Company.

Many companies, the new generation of companies are focusing on what we call the triple bottom line. Focusing on profits – this means that it’s very important for survival, but also for business success. Focusing on people – which means caring for employees, paying good salary, recognizing when they contributed to the company’s mission. And also caring for customers, caring for offering good products – high value, but also caring for suppliers, developing win-win agreements. And also caring for the planet – being environmentally friendly, using recyclable materials. And I noticed that there was some research on this, but they wanted to go deeper.

And I tried to research this for three years. And this was coordinated by my new book, “The Art of Compassionate Business, published by Routledge, 2019. This is a short story of my evolution. And then I started advising companies on compassionate business, compassionate customer relationships, and compassionate relationships with different stakeholders. And generosity in business, or gratefulness in business.

Different non-traditional topics that could be of interest for many companies.

Sean: You mentioned your book, “The Art of Compassionate Business”, and I’m super interested about that and your idea of compassion for stakeholders. Now, I want to know, why do you say your mission is to help companies, not just become very profitable? Which is already great, but also become compassionate with their stakeholders.

And the implicit here is I’m wondering, you’re talking to directors, you’re talking to C level executives and you tell them, you have to be compassionate. I can see some push back there. Because like, maybe they’re wondering like, how is this it’s going to affect our bottom line? How is this going to be affecting our branding?

I’m sure that you have faced these pushbacks. How do you deal with them?

Bruno: Very true. I have faced a lot of resistance from CEOs, from directors, from managers, and they told me what matters in business is profit. What we are talking about is compassion – compassion sounds a bit soft. We have to achieve objectives that are quantifiable, that can be measured up, can be counted. For example, profit, market share, sales. And I told them that the quantitative aspects of business are important. What can be measured? What can be counted? But a very famous thinker has said – “not everything that counts can be counted and not everything that can be counted count”.

So we have to understand that there are qualitative aspects of business. What cannot be measured? For example, compassion, empathy, support, care, and generosity. And I told these leaders that business is about human beings. You cannot succeed without human beings. I’m paraphrasing a very famous thinker – “No company is an Island.”

No company can succeed on its own. Companies – taking into account the famous management guru, Stephen Covey – “companies are interdependent”. They depend on suppliers. They depend on employees. They depend on community members. They depend on the customer. So when a company treats all the stakeholders, individuals, and groups with interest in our organization in a compassionate way – according to a very famous social psychology principle, the law of reciprocity. When you treat others in a compassionate way, they tend to support you in return. Instead when you treat them in a very non-compassionate way, they tend to withdraw. They tend not to cooperate. They tend to choose other companies. Employees will try to look for other job opportunities. Customers will look for other companies.

Community members might even boycott your company’s products and services. And suppliers might look for other buyers because they only want win-win agreements. So I mentioned that the building blocks of any business activity is the human being. And many COOs and directors told me “No, but we want key performance indicators. We want to, to achieve profitability, productivity, efficiency”. And I told them – these indicators are very important for business survival and success. But these indicators, you can only achieve these indicators when you develop long term mutually profitable relationships with different stakeholders, because these indicators are always the natural result of the interaction between a company and the company’s stakeholders.

So when you improve the relationship with these stakeholders, these indicators tend to improve in a natural way, in an organic way. So this is very important. And some CEOs understand because there is a new generation of CEOs, obviously much younger CEOs that are much more open minded. And they understand that when you care for people, when you treat people in a very  compassionate way, you generate what I call and observe – an approach of emotional intelligence.

You are being, not only recognizing your own emotion and expressing them overtly, but you are being compassionate. You’re being caring with others. And others tend to act in return – in the same way, in a reciprocal way. So this is very important because the building block of any business is the human being.

The employees are the interface between the internal environment of a company and customer. If we don’t treat the employees in a compassionate way. If we don’t pay a fair salary. But also caring for them – this means recognizing with a thank you, you know, when they did their best, when  they went the extra mile for this company.

Employees will get resentful, might look for another job opportunity and  might even work by the book. When we don’t care for customers, we try to deceive customers and when we try to offer a product that is not to value for them – we only offer a product of value for our company. The one that we can get high profits, this customer might discover this, and might go to other companies.

And might even leave negative reviews online? So that is not good. And when we don’t care for communities – communities are very aware nowadays. And we can see that they can perceive when companies are only to get their resources, and they don’t get anything back.

When a company is not acting in a socially responsible way. This community will not support the company when they have difficulties, and might even boycott the company’s products. This also applies to suppliers and other stakeholders, so it’s fundamental. Business is about relationships. Relationships should always be win-win, because we’re talking about relationships where both parties get a gain, they win, not one party winning at the expense of others.

If a company is, and every single stakeholder should win. If your company is selling good products to customers, the corporate is getting profit, the customer is getting profit, but then the company when producing these goods is polluting the environment that is one stakeholder, the community and the environment in general, that is not benefited from this transaction.

So I always tell my clients that we have to ask ourselves very important questions. Is this business decision benefiting all stakeholders that are related directly or indirectly to our company? If not, we have to rethink this decision because it’s not compassionate.

Sean: Very good insight right there. And you know, I’m reminded of this story by Patrick Lencioni. I don’t know if you know him, but brilliant guy.

He says that there is this TV episode that he watched, and the husband of Lucy comes home and he says, “what are you doing?” And Lucy’s looking for something in the living room. And she says, “I lost my earrings. I can’t find them.” And then the husband says, “Oh, you lost them in the living room.” And Lucy says, “No, I lost them in the bedroom.”

And then the husband says, “then why are you looking for it in the living room?” And she says, “because the lights are better here.” It’s the same with a lot of other companies, who want to deal with those measurable things. I love what you said, not everything that counts can be counted and not everything that can be counted, counts.

Really true, really important that resonates with me. That’s going to my Facebook page. So what, I love that you mentioned, it’s not all about the measurable things. It is a thing that deals with a human emotion that matters.

Bruno: There are other difficulties in business. For example, you see business, they’re using a lot of terminology of wars that are related to warfare. For example, strategy, tactics, beating competitors. So this does not sound very compassionate to me. And some companies tell me, “but we have competitors.” But in some cases, these other companies that you call competitors can be potential partners. You can develop partnerships, or you can treat them as models to emulate. But there is always this war mongering approach of beating others, exploiting employees, or taking advantage of others.

That is based on what I call in the book is scarcity mindset. This means resources are scarce, we have to fight over these resources. Companies should use more words related to good qualities, such as support, care, compassion, or empathy. In the book I use the word love, and lots of entrepreneurs got a bit confused, because they relate the love to the sentimental  connotation of love.

Love that you feel for your family, your friend, your partners. This is a very interesting but limited connotation of love. Here I’m talking about a much more humanistic connotation of love, which includes compassion, empathy, support, care, generosity, gratitude. And these kinds of pay to any relationship, business relationship and non-business one.

And there is a lot of research. I’ll give you an example. According to Barsadyan O’Neill, a loving working environment, there is a paper called “what love has to do with it”, a scientific paper. And this author observed that, when you have a loving working environment, employees tend to feel much more satisfied.

There is higher employee productivity, lower stress levels, lower absenteeism, lower turnover. And this author corroborated the fact that these environments bring about higher profits. This means that it affects the bottom line positively. It’s not totally like what we can call a new age approach, but it’s much more focused on what we call positive psychology, it’s based on science.

This means that treating others in a compassionate way, treating others in a good way, in a caring way. Bring about good relationships, people feel at ease, they don’t feel frightened and they don’t feel threatened. They can think clearly and when people feel at ease that is what we call as psychological safety.

When people feel at ease in the work environment, or as a customer, or as a business partner, people can think clearly. They can use their skill much more insightfully and they can obviously bring up much more creative ideas. Instead of when people feel threatened, this means that they feel that they have to fight over resources.

They tend to focus only on the threat or the threatening factor and they cannot think clearly. The thinking skills are narrowed down to the threads, so it’s not good. So bring up positive relationships, mutually beneficial relationships. It’s not only totally good for business, but also for communication, interaction, and report.

I mentioned also in the book that many companies only try to focus on what we call business topics, instead of knowing more about the human being, how to connect to others in a much more humane way. And this is very important because the basis of any business activities is a human being.  We’re not talking about roles, roles are important, but roles are a very limited view of different stakeholders.

We have human beings. Can we know more about them?

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