So let them boost other units as well. Units fighting near a hero would not waver and break as fast. Flipside, if a hero dies in view of other units, they get shaken.
Seems like a good idea.
How effective it is and how many units it could potentialy affect should probably depend on the hero's leadership skill and a little bit of swordfighting or jousting if he is a cavalry leader maybe, to potentialy simulate how he impresses the troops more by being skillful with his weapons.