Impact of Office Environmental Performance on Corporate Value: An Objective Data Analysis in Human Capital Management

The built environment is increasingly recognized as an important factor influencing employee well-being and organizational performance, and office environmental improvement is discussed as a component of human capital investment. However, empirical evidence linking objectively assessed office environmental performance to corporate value remains limited. This study examines whether office environmental performance, regarded as a form of human capital investment, is associated with workforce outcomes and corporate value. The analysis covers 69 office properties occupied by 137 publicly listed companies in Japan as of April 2024. Office environmental performance was evaluated using the CASBEE-Wellness Real Estate (trial version), a simplified assessment tool derived from CASBEE-Wellness Office and designed for existing office buildings. The evaluation focuses on fundamental environmental qualities related to safety, comfort, health, and workplace productivity. Objective building scores were combined with corporate attributes, indicators of human capital investment outside the office environment, and employee-reported outcomes obtained from statutory disclosures and a workplace review platform (OpenWork). Corporate value was measured using return on equity (ROE) and the price-to-book ratio (PBR), calculated as five-year averages and average growth rates over FY2019-FY2023. Correlation and multiple regression analyses were conducted to examine the relationships among office environmental performance, human capital indicators, and corporate value while controlling for firm characteristics and other human capital investment factors. The results reveal statistically significant positive associations between CASBEE-Wellness Real Estate scores and workforce-related outcomes, particularly retention rate after three years of employment and quality of workplace communication. These outcomes are closely related to employee stability, organizational connectedness, and mental well-being. In contrast, no direct relationships were observed between office environmental performance and short-term financial indicators such as ROE and PBR. These findings suggest that improvements in office environments may first manifest as enhancements in human capital rather than immediate financial performance. Office environmental performance appears to function as a foundational investment supporting workforce-related outcomes that may contribute to corporate value over a longer time horizon. This study highlights the role of office environmental performance in advancing human capital management and offers empirical insights for corporate managers, investors, and policymakers seeking sustainable organizational performance.