This person feels respected not because the other person in turn respects him, but because he has learned to respect himself, and thus needs other people’s affirmation less. He is fulfilled and satisfied with his life, and he doesn’t have time to flatter other people. He’s not an empty shell who lives off other people’s smiles that affirm how smart and good he is. He is guided by the feedback of others periodically to ensure that he’s on the right track—but not much more than that.
When a person treads this path, the המקום רוח approves of him, and the Ribbono shel Olam in turn causes others to like him as well, and the הבריות רוח is also הימנו נוחה. Conversely, if a person chooses the mistaken path of flattery and seeking to be liked, it will only lead him to anger and disappointment. He’ll end up lashing out at others, accusing others of wrongdoing, and he will discover that he really has never earned their respect... and he won’t be viewed favorably by Hashem or by the people.
As noted, the true purpose of gauging the הבריות רוח is to ascertain whether we’re fulfilling our mission on This World of bringing pleasure to the Ribbono shel Olam, that it should be הימנו נוחה המקום רוח, that Hashem should derive satisfaction and pleasure from his deeds.
