Operators are still in the early stages of their ESG journey, according to the first ever ESG survey undertaken in the flex and coworking sector, carried out by technologywithin.
Between February to April 2025 technologywithin conducted a survey and interviews with flex and coworking operators, with survey respondents predominantly from the UK (78%) and the remaining 22% representing operators from Europe and other global markets.
Among respondents, 19% currently have no ESG policy, while 22% are in the process of developing one. However, there is progress, with nearly half (47%) having already created a combined ESG policy, and 25-28% having introduced additional policies focused on areas such as Diversity, Equity & Inclusion (DE&I) and sustainability.
Progress remains relatively recent. A significant portion (41%) have only developed their policies within the last two years, while just 19% have had an ESG policy in place for more than three years. Encouragingly, 59% of operators review their policies annually, indicating efforts to embed ESG considerations into both strategy and operations.
The UK is legally committed to net zero by 2050 and has set an interim target to reduce emissions by 78% by 2035. With buildings contributing to 42% of global emissions (Architecture 2030) - 15% from embodied carbon (building materials) and 27% from building operations - and global building floor areas set to double by 2060 (International Energy Agency), it has never been more important to move forward with business’s ESG efforts.
Samuel Warren, Sales and Marketing Director at technologywithin says: “At its heart, ESG means having a well-run, ethically guided business, which is thoughtful about its impact on the planet and community. Practically it means having meaningful policies in each of these areas, setting objectives and creating clear plans to deliver.”
The technologywithin survey demonstrates that leadership ownership is a key indicator of how deeply ESG is embedded in an operator’s business strategy. Samuel adds: “Alarmingly, 18% of respondents report that no one in their senior leadership is responsible for ESG, while only 9% indicate that responsibility is shared across the board. The most common roles overseeing ESG initiatives are the Managing Director/CEO and the Operations Director, both at 27%. To bridge the leadership gap, some operators are appointing dedicated ESG specialists (24%), a trend that is expected to grow.”
Paul Nellist, Managing Director of Koba, believes that bringing in external expertise to create policies was the right choice for them: “We spent nine months coming up with our manifesto and processes around sustainability, working with Drees & Sommer (a German built environment sustainability practice) and our design partners, Cast. We were able to leverage the knowledge and understanding from Drees & Sommer as the market experts, coupled with Cast bringing their UK lens. We couldn't have done it ourselves.”
Adding to the need to accelerate the ESG journey, pressure from stakeholders to improve ESG transparency is increasing. Nearly half of respondents (49%) rate ESG reporting pressure between 5-7 on a scale of 1-10, whilst a further 27% experience significant pressure, rating it between 8-10.
When it comes to new client demands, 51% of operators reported that no more than 20% of their new clients request ESG credentials. However, this trend is shifting, with 27% stating that 40-80% of new clients ask ESG-related questions before signing a deal. The top client priority is sustainability, with 84% identifying environmental concerns as the most common inquiry (above social and governance).
Client ESG engagement extends beyond contract signing, however. A strong majority (73%) of operators already include ESG updates in their ongoing communications, via newsletters, social media, websites and annual reports. And internal engagement is just as crucial. Paul Nellist explains: “We're very specific when it comes to hiring people. They don't have to be sustainability gurus by any means, but they need to show an awareness and a passion, as well as an understanding that this is what Koba is all about.”
Implementation is the challenge for operators
Implementing ESG policies across diverse, legacy portfolios presents significant challenges for many operators. Operators cite major barriers such as budget constraints (64%), unclear return on investment (42%), process complexity (33%), and difficulties in uniform policy implementation across sites (30%). Crucially, 46% of respondents also acknowledge a lack of expertise as a key barrier to progress.
When asked about factors that would accelerate ESG adoption, financial incentives emerged as the top motivator (71%), followed closely by enablement from knowledge-sharing initiatives, including industry best practices and peer discussions (63%). Other important drivers include government incentives such as tax breaks and grants, as well as support from landlords and property owners (both at 59%). Occupier demand is also a factor, with 56% of operators stating they would be influenced by tenant expectations.
Internally, winning the hearts and minds of your team is needed to implement policies. Josh Rose, ESG Manager at Clockwise, believes that team inclusion is the route to success, “At building level, every location has a representative on the ESG Champions Committee. This is great because it means that we have buy in – and feedback – at ground level.”
Operators are struggling with measurement but drawn to certification
ESG tracking and measurement remain in its infancy. Currently, 36% of operators do not measure any ESG initiatives, and 33% rely on manual methods such as spreadsheets. Only 20% use external auditing services or dedicated ESG platforms, with cost likely being a barrier to broader adoption.
A critical question is whether operators are measuring their portfolio’s carbon footprint - currently, only 40% do. This is likely due to the challenges of gaining information from the landlord in leased spaces.
Polly Bryan, Implementation & Quality Director, Orega, says: “The situation that almost every flex space operator faces is that we have diverse portfolios, with buildings of differing ages and states of maintenance, owned by a cross section of landlords, whose level of interest in supporting a consistent set of sustainability and wellness goals varies hugely.”
To bolster credibility, nearly half (46%) of operators have obtained some form of ESG certification, with BREEAM, B Corp, Planet Mark and the WELL Coworking Rating amongst the most recognised standards. Paul Nellist has a clear approach to defining what matters when it comes to certification, “What I've learnt is that landlords are not interested in which certification you've got. They're more interested in the story and what you can do for their building. Having a WELL Coworking Rating certified sticker on our front door in Barbirolli Square Is probably 100 times more valuable to the landlord than a generalist certification because it's real and it attracts the best companies.”
For Magda Al-Nugaidi, Managing Director at Uncommon, BREEAM and BCorp were the preferred options, “We opted for BREEAM accreditation as it’s building-specific and comprehensive, including focus on well-being. With B Corp, it’s not about the badge, it’s shifted the way we operate and given gave us confidence that we are on track.”
Environmental initiatives show strong progress
Operators appear to be more advanced in action than in policy, which is confirmed by Budelia Probert-Watts, Sustainability Manager at Fora, when talking about the company’s early stage ESG journey, “Ground-up initiatives were a logical place for us to start. Organic ideas like volunteer days and recycling.” An overwhelming 97% of respondents have implemented active ESG initiatives with the top environmental priorities including:
Recycling and waste reduction (81%)
Energy-efficient lighting and appliances (69%)
Renewable energy adoption (59%)
Sustainable procurement policies (44%)
Use of eco-friendly building materials (28%)
Paperless office operations (20%)
Who bears the financial responsibility for ESG investments is contentious
A key point for debate - bearing in mind how much of a barrier budget constraints pose to action - is who should bear the financial burden of improving building sustainability. Only 21% believe operators should bear the full cost. The majority (63%) favour a shared financial responsibility between landlords and operators, highlighting the need for collaborative investment in ESG initiatives.
Operators are focused on social impact and community engagement
Uncommon’s Magda Al-Nugaidi says: “We are focused on doing what’s obvious and easier first in terms of the wider social impact of our spaces. We have prioritised activity in buildings that are underutilised, offering workspace to Not for Profits. We also have a charity partner - Spread a Smile - for whom our CEO is a champion, and we continue to host fundraising events for them.”
Beyond environmental concerns, operators are considering the social value creation opportunity through their spaces, whether that is the local geographic community, or by supporting Not for Profits. A significant proportion:
Support charities or social causes (75%)
Partner with local businesses (71%)
Host free community events (57%)
Offer coworking scholarships or incubator programs (10%)
Fora’s Budelia Probert Watt doesn’t yet believe that the approach is strategic enough, “Creating social value locally from workspace is challenging to achieve. A local needs assessment is the best place to start, to offer the most help and create impact.”
The ESG journey has started but there’s a long way to go
So, where do operators consider they are on the ESG journey? When asked to rate their ESG progress on a scale of 0-10, operators assess their position at an average of 5.3, indicating that most see themselves as midway on the ESG journey, or as Magda Al-Nugaidi puts it, “We’re in the active implementation stage.”
But what could help them progress more quickly? The majority want clarity on the long-term financial benefits (72%) and cite that knowledge sharing and the creation of industry best practises are vital to continued improvement (63%). Several operators cite support from their investors ESG teams as key to their analysing the long-term value of investing in ESG initiatives and creating actionable plans.
Polly Bryan’s advice to her peers?: “As an industry we need to be proactive at this point, create goals and policies that are ambitious but realistic; measure our base line and listen to our clients.”
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