Organizational psychologists have long been touting the benefits of fostering positive workplaces, but some companies still uphold cut-throat, high-pressure environments in the belief that it’s the best way to whip employees into shape and deliver results. In reality, it’s sometimes the best way to push employees towards burnout.

Want the proof? Here’s what two top experts had to say about the benefits of work cultures that make employees feel good.

Practice positive

Kim Cameron, professor and associate dean at the Center for Positive Organizational Scholarship from the University of Michigan, co-authored a research article in the Journal of Applied Behavioral Science which found positive work cultures produce much more effective teams.

By “positive” he means that the companies implement positive practices. That means they concentrate on making their employees feel good in the workplace and nourishing positive emotions, which helps boost employee creativity. Meanwhile, they provide employees support from negative emotions such as stress, and build up their employees’ competencies and trust. The result is a happier, more hard-working team.

“When organizations institute positive, virtuous practices they achieve significantly higher levels of organizational effectiveness — including financial performance, customer satisfaction, and productivity… The more the virtuousness, the higher the performance in profitability, productivity, customer satisfaction, and employee engagement,” explains Cameron.

Culture affects leaders too

The follows from the idea that workplace culture overall plays a big part in organizational effectiveness. Often, strong performance is chalked up to a certain leadership style, and there’s endless research and articles devoted to profiling the qualities of a successful manager.

However Cameron says companies should look beyond the leaders and at the bigger picture: the workplace culture in which the leader has thrived. Companies which focus on efficiency and stability will tend to have controlled leaders who run a tight ship. Meanwhile, those which prioritize change and creativities tend to have entrepreneurs and risk-takers rising to the top.

“Everybody has a personal style, but style doesn't predict performance. It's competencies that predict performance,” he said in an interview. And the best leaders, he says, tend to be a mix of the competencies across the spectrum: people who adapt to the situation and knows how to take risks but also when to play it safe.

“They know when to keep things under control and maximize efficiency, and when it's the right time to break rules and be innovative. They know how to build and motivate teams, and how to get tough, if necessary,” said Cameron.

Trust and Compassion

Meanwhile, a leading Stanford psychologist says compassion has to be at the core of any successful manager’s approach.

This keeps team members loyal and happy, which is critical in light of growing research that companies with high employee turnover and a high number of sick days lag behind in productivity. According to a report by the Center for American Progress, the average cost of employee turnover was 21 percent of an employee’s annual salary, racking up the costs for companies.

According to Emma Seppala, associate director of Stanford’s Center for Compassion and Altruism Research and Education, compassionate leaders get much more out of their employees than those who stir up fear or punish employees harshly for mistakes – tactics which she calls counterproductive:

“The problem with this type of approach is that it increases stress levels which – when they are high – can disrupt the culture of an organization. Moreover, we know from brain-imaging research that, under chronic and high stress, the ability to think clearly and reason is compromised. If your employees are constantly operating from a place of fear, chances are that their productivity and decision-making will take a hit,” said Seppala in an interview with Stanford University.

The expert says that being a compassionate leader means practicing forgiveness and mindfulness when dealing with employees because these tactics guarantee employee loyalty and trust. It’s not about backing down, she says, but about choosing a different style of communicating:

“I’m not suggesting that managers not express dissatisfaction or point out errors. However, they should be skillful and kind in how they choose to communicate with underperforming employees.”

Compassionate practices even trump the power of a bigger paycheck when it comes to securing team loyalty. Seppala points to a British study on work attitudes which found that employees valued workplace relationships, self-worth and the nature of the job itself far higher than a salary. In other words, getting your employees to stick around isn’t about throwing more money at them – it’s about cultivating a positive workplace culture.

Seppala says it’s important to foster employee trust because it’s critical to high performance.

Employee trust, says Seppala, is a critical factor in high performance. As we humans are wired to constantly analyze whether we can trust our environment, compassion increases that sense of trust. Seppala cites neuroimaging research which confirms that the human brain is wired to respond more positively to bosses who show empathy. That means compassionate leaders end up with the teams who deliver better results.