When you compress your suspension oil is displaced from one place to another. When your suspension extends it moves back to where it was. We control the oil movement and thereby the handling.
The piston and shim stack are on the end of the shaft that is displacing the oil. They are surrounded by oil. The piston moves at nearly the same moment as the shaft so there is no measurable delay between movement and damping here.
But the reservoir is not right next to the piston. Because fluids, mostly, can’t be compressed, does the reservoir do it’s thing at the same moment as the piston? Because the oil has mass it can’t move as fast as light so the speed has to be slower than light. What speed does this signal travel at? Hint, fast enough that you can’t feel any delay.
There is also the flex in the body of the shock, hose, seals and everything else in the system.
Hysteresis is the totality of all this and the left over effects of whatever the system was doing just before whatever it’s doing now.
This is true for forks too.