Sustainability and the four day work week

In June, 70 UK firms and more than 3,300 workers spanning numerous industries, signed up for a six-month trial of a four-day working week. With similar trials due in Scotland, Australia, Spain, New Zealand, the US and Canada, and Belgium announcing in February that employees will be offered the opportunity to request a four-day working week, we’ll look at the pilot and where this flexible approach to work sits within the ESG sphere.

A triple dividend policy

We know that creating a thriving workplace culture delivers great business results. A focus on workforce value results in improved engagement, productivity, loyalty and retention. The pandemic shone a light on this like never before, necessitating new ways of working, and for many employees, leading to personal considerations around a work/life balance.

With the four day working week thought to be a triple-dividend policy – helping employees, companies, and the climate – these trials seem a natural step in understanding and rethinking the way we do business. 

The UK pilot is organised by 4 Day Week Global in partnership with the thinktank Autonomy, the 4 Day Week Campaign, and researchers at Cambridge University, Oxford University and Boston College. 

Joe O’Connor, chief executive of the not-for-profit group 4 Day Week Global, said the UK was at the crest of the four-day week wave: “As we emerge from the pandemic, more and more companies are recognising that the new frontier for competition is quality of life, and that reduced-hour, output-focused working is the vehicle to give them a competitive edge.”

Researchers are working with all participating organisations to measure the impact on business productivity, the wellbeing of its workers, and the impact on the environment and gender equality.

The advantage for companies

Microsoft’s Japan offices have already trialled a four day work week, seeing a staggering 40% increase in productivity. With mid-point research results released for 4 Day Week Global’s UK pilot, 63% of businesses have reported finding it easier to attract and retain talent; recruitment and retention cost savings therefore additional benefits. The shortened workweek allows companies to save on electricity, office supplies, and cafeteria costs.

The Government Equalities Office research on the Gender Pay Gap shows that roughly two million British people are not currently in employment due to childcare responsibilities and 89% of these people are women. The US Census Bureau reports this at approximately 10 million American women; that number was 1.4 million before the pandemic, highlighting a growing issue. A four day work week would promote an equal workplace as employees would be able to spend more time with their families and better juggle care and work commitments.

In 2018 New Zealand based company, Perpetual Guardian, conducted a trial study of a four day workweek. Not only did employees maintain the same productivity level, but they also showed improvements in job satisfaction, teamwork, work/life balance and company loyalty. 

Employees also experienced less stress with a decrease of 45% to 38%, taking fewer sick days as a result. With workplace mental health a growing category under the ‘social’ pillar of ESG, corporate consideration in this area provides competitive edge in attracting top talent.

Environmental impact

The introduction of a four-day working week with no loss of pay would dramatically reduce the UK’s carbon footprint, helping the country meet its climate targets.

 A 2019 study found that moving to a four-day week by 2025 could shrink the UK’s emissions by 127m tonnes, a reduction of more than 20%. For context, this would be equivalent to taking the country’s entire private car fleet off the road.

The adoption of a four day workweek could hold multiple ESG benefits. By engaging with companies on issue such as promoting equality and wellbeing, and climate change mitigation, asset managers hold a powerful position in encouraging companies to focus on the ‘triple bottom line’ of people, planet and profit.

Get in contact if you’d like help streamlining these important conversations.

Image credit to Vecteezy.com.

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