31 Mar Exploring the sustainable office of the future
Many leading businesses across the nation are making plans to downsize their offices and implementing measures to enable remote working to continue post-lockdown at some level. With the impacts of the pandemic being the key driver, what exactly will the sustainable office of the future look like?
Sustainability news platform Edie recently published a guide on sustainable office in the ‘new normal’, hosted in partnership with Rio ESG. Since the report was released, further studies have explored business office plans, remote working requirements have emerged and the rulings related to the recovery from the pandemic have progressed.
A recent survey of UK businesses discovered that over 70% are expected to confirm downsizing plans by the end of this year. The key motivation is relatively clear – more employees intend to work remotely, for at least some part of their working hours once lockdown restrictions are lifted. A study by KPMG showed that out of 500 CEOs surveyed, around 20% are focused on hiring remote workers, while an additional 30% are exploring hybrid working models for all of their staff.
The secondary driving force for this change relates to the need to reduce costs. The UK economy was significantly impacted during 2020 and many businesses hope that smaller offices will help them financially and enhance their social, environmental and sustainability plans.
Businesses have been exploring a ‘hub’ format, allowing staff that need to work from an office the option to visit their nearest office, rather than their usual location. Employees are utilising this system for certain meetings and workshops and most have shown strong support towards a ‘hybrid’ model, allowing individuals to carry out certain tasks from home and group activities in the office. If this trend persists it’s likely some offices will reshape themselves into this pattern, creating larger hubs and moving away from smaller office locations that are far more energy-efficient. Energy consumption in the office space is one of the biggest sources of emissions for most businesses.
Other businesses are following on a similar path, recognising the benefits hybrid working offer for their staff and our planet. PwC has announced several changes, investing £75 million in the UK to develop open, collaborative spaces and investing in more technology to support remote working conditions.
A new stage for accounting emissions
Smaller office spaces generally result in lower energy bills and less carbon, and working remotely reduces emission levels in regards to commuting and business travel. The latest emissions reports from the BEIS indicated that business-related emissions declined by 8% in 2020. However, remote working does have an environmental impact and similar studies show a 2% increase in domestic emissions. Studies from Bulb and EcoAct in 2020 suggested that UK businesses could under-report annual emissions by a significant amount, due to the complexities of measuring emissions associated with their remote workforce.
Discussions concerning the best method for accounting and reducing emissions continue. Some companies have created specific employee communications and engagement schemes dedicated to providing information on domestic energy efficiency. Other businesses are developing measures to support staff finance domestic solar panels, home insulation or low-carbon transportation. These types of plans offer an exciting opportunity for employers to align their sustainability objectives with a new flexible working model.
A shift in investment plans
Legal & General is one major investor that has announced new climate targets, following a rise in increased ESG investment and added pressure on investors to ensure financial-related emissions are aligned with climate action. Many organisations have made plans in terms of climate strategies, but the pandemic has had a direct impact on sustainable finance plans.
Ed Dixon, the head of ESG at Aviva Investors believes this is the biggest investment opportunity we have faced for many years and accelerating plans towards low carbon will create many opportunities for clients.
The commitments of asset managers will inevitably reshape the office landscape. New developments will focus on low-carbon solutions and enhancing the health and wellbeing of the workforce. Energy efficiency measures will become a priority for new builds and retrofits of existing office spaces. There will likely be a surge of net-zero carbon offices over the next few years and government measures will support the development and improvement of carbon-related metrics in buildings.
The benefits are clear but further communication and collaboration will be needed to meet these new plans. The level of engagement can vary greatly between businesses and smaller companies may require further support with the transition to net-zero carbon offices.