An Embassy is a structure required to recruit diplomats. Embassies require at least a Town-level settlement and cost 2000 Rupees to construct. All factions in Hyrule: Total War can construct embassies except the Gohma, Stalfos, River Zora, and Kingdom of Ikana.
Many cultures in Hyrule are more then willing to bring arms against each other, though there are times diplomacy might be the better option. Be it to gain a new ally against a common foe or to reap the rewards of shared resources, sometimes talking to the right neighbor can be as powerful as dealing a fatal blow to an enemy.