Morale

Morale impacts the units fighting power and is gained or lost by casualties caused or suffered in their immediate vicinity. It is also used to resist attacks by directly increasing the magic damage reduction. Units lose and gain morale based on casualties happening in their vicinity to friends or foes. Whenever a unit loses a morale state, their combat power diminishes as well. If a unit becomes routed, it will flee and lose its next turn. You can recover morale by resting.

Casualties taken by nearby friendly units in battle will cause morale to fall, while enemy losses will cause friendly morale to increase. Units with higher morale will fight better than those with low morale, especially when fighting against magical weapons.
 * When a unit’s morale falls below 67% it will become Disordered,
 * at 34% Routed
 * at 0% Broken.

Morale is shown on the unit’s map icon, which is fully coloured for high morale units, striped for moderate morale, and completely white when a unit is broken.

''Combat is not the only way morale can change. The use of artefacts and choices made in narrative events can also influence it.''

When a unit is killed, whether by melee or ranged attack, any artefacts it was carrying will be captured by the attacking unit, or added to your inventory if that unit cannot carry any more artefacts. Some artefacts are very powerful, so be sure to capture as many as possible!