The Effect of ESG on Commercial Property and Why it Cannot Be Ignored

ESG (Environmental, Social and Corporate Governance) is a term that here at Boxpod we are hearing increasingly about in the world of commercial property.

It is a measure of the social and environmental consciousness that a business has, and this is becoming a growing factor in attracting people to work for a business as candidates look to their employers to have similar moral and ethical values to their own.

Historically in the US, the ESG given to a business is in a rating form. However, in the UK, it is important that businesses make it clear what their ESG policies and cultures are in order for potential and current employees to make an informed decision about whether they wish to work there.

Factors Included in the ESG of a Business

There are several aspects to the business that are taken into consideration when thinking about its ESG. These include:

Environmental Factors

  • The business’s effect on the climate
  • Sustainability

Social Factors

  • Diversity
  • Consumer Protection
  • Human Rights
  • Animal Rights

Corporate Governance Factors

  • Employee Relations
  • Company Management Structure
  • Employee and Executive Compensation
  • Responsible Investment

When it comes specifically to commercial property, the company premises play an important role in ensuring a good rating in the environmental factors as well as the well-being and company culture in terms of looking after employees and customers alike.

Creating an Attractive Workplace Through Commercial Property

In a world where there is increasing competition for the best candidates, it is important to be able to attract them – and ensuring that your ESG rating is as high as possible is one of the key factors. Some of the ways that you can help to ensure higher ratings in your business premises are in making it a place that is easy to work and be productive in.

Some ways that you can manage this through your office, retail unit, warehouse, or other bought or rented workspace include:


Finding the right location is essential. Each business and its employees have different needs. For some, a rented office in the city centre is best. It allows for networking and proximity to bars and restaurants for wooing clients. For others, an out-of-town warehouse might be better – somewhere with good access to transport links. Or perhaps you need a retail unit in a bustling small town… You should consider your employees – how are they likely to get to and from work and does your location work for them?


Different businesses have different cultures and ways of working. One thing that we are seeing as the COVID-19 pandemic progresses is the rise in ‘hybrid’ working. This is the mixture of employees working from home as well as going into the workplace. Of course, this is not conducive to all businesses but is a model that is becoming more and more popular.

When it comes to the workspace, it is important that it is optimised to work with this hybrid approach. For example, are you going to employ a hot-desking strategy within the office or give people their own dedicated workspace? Is it likely that your employees will be coming into the office to carry out more collaborative work? Will they be engaging in more video conferencing? Is your company culture one of working as an independent or is teamwork more important to you?

These questions should all be considered when you are looking into how to set out and structure the workplace, to make it work in the way that you want it to work as well as giving your employees the ability to be as productive as possible.


The world is being more and more aware of the need for inclusivity everywhere – and especially in the workplace. This means that you should be ensuring that you go above and beyond your legal obligations in terms of inclusivity.

You should be thinking about how to ensure that there is good wheelchair access for everything, consider other people with physical disabilities as well as people who are blind and deaf, or who have conditions affected by their environment.


The interior design of the building is also important to shaping your company culture and ensuring that your employees are productive. Colour is an important part of this. Of course, everybody prefers different colours, but it is generally agreed that for a productive workforce, pastel colours are the best option, with a few splashes of brighter colours.

Natural Light

Ensuring that there is substantial natural light inside the building is also important to both employee welfare and productivity. It can help to reduce the chance of eyestrain and headaches and is generally healthier for those inside the building. To help to ensure that there is as much natural light as possible, ensure that the windows are regularly cleaned and reduce the number of objects that are put in front of them.

If you believe that there is not adequate natural light in the building, think about adding ceiling light panels or personal lamps.


The flexibility of layout is another important factor in making the workplace a comfortable place for your employees. Especially if you are expecting more collaborative working amongst your employees, you should think about creating a space where desks, chairs, and other furniture can be moved easily into different formations. Having wheels on furniture may be useful, the ability to create small individual working areas with screens, other activity zones, as well as a selection of different chars and desks – sit-stand desks or rocking chairs, for example.


Noise can be an issue for all offices. It might be that your employees have got used to working in the silence of home, or perhaps they prefer the hustle and bustle of a busy workplace. Try to accommodate the needs and necessities of your employees – maybe creating different workspaces whereby employees can go to where they feel most comfortable.

You can help to reduce noise by adding acoustic panelling on the ceiling and/or walls, adding screens, or adding curtains, for example.

Final Thoughts

A company’s ESG is important in being able to attract new employees as well as a fundamental need to do the right thing for society. By making it more attractive to environmentally and socially conscious people through a number of methods – including the premises that you are based in, you should be able to help to boost the success of your business by attracting the best employees and ESG-conscious customers.

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