Why Executive Coaching Became a Top Organizational Investment in 2025

August 12, 2025
By Jeffrey E. Auerbach, Ph.D., MCC, NBC-HWC

Executive coaching session with a manager in a hybrid workplace setting

With hybrid work getting harder to manage, AI changing roles faster than job descriptions can keep up, and employees fatigued by constant change, organizations are investing in executive coaching to steady performance and build the capabilities leaders need. The data backs it up — and it's creating opportunities for well-trained, ICF-credentialed coaches, trained at ICF Accredited Coach Training Programs.

Engagement Drops and Coaching Demand Increases

Global employee engagement fell from 23% in 2023 to 21% in 2024 — the second drop in 12 years — driven largely by a decline in manager engagement (30% to 27%) and an estimated US$438B productivity hit. Female managers' engagement dropped even more — down 7%. When managers struggle, teams follow. Coaching targeted at managers is one of Gallup's recommended levers to reverse the slide.

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Harvard Business Review's recent coverage reflects what many of us are seeing in organizations: hybrid work isn't "set it and forget it" — without new management practices, hybrid work can hurt collaboration and weaken culture. At the same time as many leaders are racing to figure out how to best integrate AI, the biggest barriers to AI adoption aren't technical — they're people and process challenges. Leaders need help redefining roles, building change resilience, and supporting teams who feel the workload pace is ever-increasing. These needs are clearly in the wheelhouse of executive coaching.

Clear Market Signals Demonstrate Demand for Executive Coaching

Profession Growth and Spending on Executive Coaching

The International Coaching Federation (ICF) estimated there were 109,200 coach practitioners in 2022 (up 54% since 2019). Active practitioners generated US$4.564B in annual revenue (up 60%), and the average one-hour fee increased. These numbers reflect not only more coaches, but higher utilization and value.

More Employer-sponsored Coaching

In 2022, coaches reported that an average of 57% of their clients were sponsored by organizations, up from 52% in 2019, indicating that companies are increasingly covering the costs. For organizational buyers, executive coaching is risk management: they invest to improve leadership behavior and keep teams engaged while roles and expectations shift.

Credentials matter

80% of coaches say clients expect certification/credentialing, and 85% hold a credential — one reason completing coach training at an ICF-accredited program is decisive for coaching career advancement.

Why Leaders Need Coaches Now: Three Forces Reshaping Work

Hybrid Work is Harder Than it Looks

Evidence summarized in HBR's July–August 2025 "Hybrid Still Isn't Working" shows that without intentional redesign — effective meetings, establishment of expectations, and performance management — hybrid work can depress collaboration and performance. Coaching helps managers translate broad guidelines into day-to-day leadership habits: clearer priorities, better 1:1's, team agreements that improve engagement, and measured experimentation to find what works for each team.

Is AI utilization a people problem and not a tech problem?

In HBR's July 29, 2025 analysis, Lakhani and colleagues report that the main obstacles to AI at scale are people issues and processes — not data pipelines, or compute capacity. Coaches help leaders do the human work: re-scoping roles, communicating purpose, building confidence with new tools, and navigating ethical issues. These are often relationship management issues that are especially amenable to coaching.

Continuous Change and Fatigue

2024 HBR guidance highlights widespread change fatigue and offers practical steps leaders can take; individualized coaching accelerates adoption of those steps and sustains them. A coach-client relationship provides accountability and psychological safety — two ingredients change programs consistently miss.

What investments are organizations making in executive coaching?

Manager-as-Coach Capability

Deloitte's 2025 Global Human Capital Trends notes that, even as AI will begin to reshape the manager role, capabilities like coaching and development are even more essential. Organizations are funding coaching programs to help shift managers from task supervision to people development — a shift that reduces attrition and speeds adoption of new ways of working.

Coaching Culture, Not One-off Interventions

Coaching cultures tie stronger cultures to higher engagement and team performance. Organizational buyers of executive coaching are also looking beyond executive-only targeted programs and seeking toward broader ecosystem development: manager coaching skills, and broader access to coaching services.

ROI of Executive Coaching

Occasionally a buyer wants executive coaching ROI statistics and may ask, "What outcomes can we expect?" Across reputable studies, coaching typically returns several times the investment: the ICF Global Coaching Client Study reported a median company ROI of about 7:1 (and 3.44:1 for individuals), Manchester's survey of 100 executives found an average 5.7:1, and a MetrixGlobal case at a Fortune 500 telecom calculated 529% — rising to 788% when retention savings were included. A conservative, defensible takeaway for business cases is to cite a 3–7× expected range of ROI for executive coaching and note that actual ROI varies with data quality.

College of Executive Coaching Guidelines to Support an Executive Coaching Investment for Your Employer or Clients

Frame the Cost of Inaction

Gallup's numbers make the stakes concrete: when manager engagement drops, team engagement and productivity fall — and it's expensive. Position coaching as a targeted response to the manager bottleneck that is dragging performance and well-being.

Connect Coaching to AI Readiness

Use HBR's point that AI's hardest problems are human. Propose a coaching plan tied to an AI initiative (e.g., pilot for two manager cohorts) with measures like adoption behaviors, cycle time for decisions, and employee sentiment on role clarity.

Make Hybrid Specific

Reference HBR's guidance to redesign hybrid norms, then show how coaching will drive two or three leader behaviors (e.g., consistent weekly check-ins, meeting hygiene, explicit "office-worthy" work) and track leading indicators.

Signal Credibility

Cite the ICF study for market growth and credential expectations; ensure your proposal specifies ICF-credentialed coaches and ICF accredited training backgrounds. Buyers are increasingly sensitive to quality markers.

What This Means if You're Considering Coach Certification

The profession is expanding, organizations are sponsoring more engagements, and credential expectations are the norm. That combination creates a practical path for those who want to build or advance a coaching career, especially coaches who can operate comfortably at the intersection of people and the increasing use of AI at work.

At College of Executive Coaching, the ICF-accredited online programs are designed for professionals who want rigorous training, mentor coaching, and evidence-based methods they can use with leaders immediately. College of Executive Coaching offers new training courses approximately every two months. If you're interested in positioning yourself for the coaching demand outlined above, this is an excellent time to begin your certification training.

Bottom Line

Coaching is a practical investment in manager effectiveness, team resilience, and AI-ready leadership. The data shows rising utilization and organizational sponsorship, while the work itself is shifting toward the human capabilities that coaching develops best. For organizations, investing in coaching is a direct way to turn a volatile year into a year of steadier performance. For prospective coaches, completing an ICF-accredited certification aligns your career with where leadership development investment is going.