AI-Powered Leadership: Why Profitable Firms Are 7% More Likely to Use AI for Better Employee Experience
A new global report from Top Employers Institute shows a clear pattern: profitable companies are 7% more likely to use AI to improve the employee experience. Not for cost-cutting first, but to make work simpler, smarter, and more human.
That's the gap HR can close. Adoption is moving fast-78% of firms already use AI in at least one function-yet too few are turning it into scaled, people-centered value.
Why this matters for HR
AI is changing how decisions are made, how work flows, and how managers lead. If HR doesn't set the standards now, the organization will build speed on outdated leadership models.
As one executive at Top Employers Institute put it, the leaders who win are those who design systems where technology strengthens judgment, empathy, and purpose-and does so with strong ethics.
What the report found
- Profitable firms are 7% more likely to use AI to enhance the employee experience.
- 39% of Top Employers see AI as an opportunity to improve employee experience, not just reduce costs.
- 48% are piloting, implementing, or have established responsible AI processes.
- 78% of companies use AI in at least one business function.
- Yet 74% of employers (per BCG research) struggle to turn AI's promise into organization-wide results.
The five pillars of AI-powered leadership
- Digital confidence: Leaders who can ask better questions of AI, read outputs critically, and make faster, clearer calls.
- Ethical stewardship: Guardrails for privacy, bias, transparency, and accountability-baked into policies and practice.
- Human-centered design: Workflows and tools that make work easier, reduce friction, and boost engagement.
- Systems awareness: Understanding second-order effects across teams, data, and processes before scaling.
- Applied empathy: Managers who use AI to free time for coaching, career growth, and meaningful conversations.
Practical moves HR can make this quarter
- Write a clear Responsible AI policy with use cases, data rules, and escalation paths. Anchor it to an external standard like the NIST AI Risk Management Framework.
- Map the employee experience and target AI where it removes friction: hiring screening, internal mobility matching, learning personalization, manager enablement.
- Run small, safe pilots with explicit success metrics (time saved, quality, sentiment, adoption) and iterate before scaling.
- Upskill managers and HRBPs on prompt quality, evaluation, and decision-making with AI (not just tool tips).
- Set guardrails for data privacy, bias checks, and human-in-the-loop signoff for sensitive decisions.
- Measure the basics: employee engagement, internal mobility, time-to-fill, quality-of-hire, and team sentiment-then link improvements to AI use cases.
What this means for performance
The firms seeing better results aren't using AI to replace people. They're using it to remove busywork, raise decision quality, and improve manager effectiveness. That's where profitability shows up-through higher engagement, stronger internal promotion rates, and better execution.
Methodology snapshot
Findings are based on anonymized responses from 2,300 certified Top Employers across 125 countries and 26 industries in the HR Best Practices Survey for 2025. Regression analyses linked HR practice adoption to success metrics such as engagement, internal promotions, and profitability. All findings noted are significant at p<0.05. Case studies feature organizations demonstrating AI-powered leadership in action.
About Top Employers Institute
Top Employers Institute recognizes excellence in People Practices worldwide. Through its certification program, organizations are assessed across six HR domains and 20 topics-from People Strategy to Learning, D&I, and Wellbeing. In 2025, more than 2,400 organizations were certified across 125 countries/regions, impacting 13 million employees.
Next step: Turn insights into capability
Review the AI-Powered Leadership report from Top Employers Institute and turn its pillars into your leadership standards and operating model. If you need to upskill your HR team and people managers on practical AI, explore role-based learning paths and certifications at Complete AI Training.
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