The following excerpt is from Chogyam Trungpa's classic and masterful text Shambhala: The Sacred Path of the Warrior. From the chapter on "Authentic Presence", Trungpa defines for us exactly what authentic presence is -- how it comes to be and how it affects ourselves and the world around us.
Achieving the realization of the universal monarch, which we discussed in the last chapter, is the fruition of developing what is called “the warrior’s authentic presence.” In Tibetan, authentic presence is "wong tong," which literally means a field of power. However, since this term refers to a human quality, we have loosely translated it here as authentic presence. The basic idea of authentic presence is that because you achieve some merit or virtue, therefore that virtue begins to be reflected in your being, your presence.
So authentic presence is based on cause and effect. The cause of authentic presence is the merit you accumulate and the effect is the presence itself. There is an outer or ordinary sense of authentic presence that anyone can experience. If a person is modest, and decent, and exertive, then he will begin to manifest some sense of good and wholesome being to those around him. The inner meaning of authentic presence, however, is connected more specifically to the path of Shambhala warriorship. Inner authentic presence comes not just from being a decent good person in the ordinary sense, but it is connected to the realization of primordial space, or egolessness. The cause or the virtue that brings inner authentic presence is emptying out and letting go. You have to be without clinging. Inner authentic presence comes from exchanging yourself with others, from being able to regard other people as yourself, generously and without fixation. So the inner merit that brings inner authentic presence is the experience of nonfixed mind, mind without fixation. When you meet a person who has inner authentic presence, you find he has an overwhelming genuineness.