Per diem payments have long been the go-to solution for covering workforce accommodation and expenses. However, as businesses strive to improve cost efficiency and ESG (Environmental, Social, and Governance) compliance, it’s time to question whether this outdated approach truly serves the best interests of organisations, their employees, or the planet.

The answer? Per diem payments must stop.

1. The ESG Problem: Loss of Control Over Corporate Spend

Organisations worldwide are committing to ESG strategies, ensuring their operations align with sustainability goals, ethical standards, and corporate governance policies. Yet, per diem payments undermine these very commitments.

When companies hand out cash allowances for accommodation, they lose control over how that money is spent. Employees may opt for cheaper, less sustainable options, such as:

• High-carbon footprint accommodations – Older hotels with poor insulation and inefficient energy use.
• Non-compliant lodging – Properties not meeting health, safety, or ethical standards.
• Unregulated rentals – Short-term lets that operate outside of tax and compliance frameworks.

2. The Cost Inefficiency: Why Centralised Booking is Better

Beyond ESG concerns, per diem payments are financially inefficient. Businesses often assume they provide flexibility, but they drive higher costs and lower-quality accommodation.

• Better Rates Through Bulk Booking – Companies securing accommodation through strategic partnerships can negotiate better rates than employees booking individually.
• Higher Standards & Duty of Care – Centrally booked accommodation ensures consistent quality, security, and compliance.
• Predictable Budgeting – Fixed corporate rates reduce unexpected costs and financial leakage.

The Solution: Corporate-Controlled Accommodation

The alternative is clear: Businesses should take control of workforce accommodation by centrally managing bookings. This approach ensures:

• Sustainable, ESG-aligned stays
• Lower costs & controlled budgets
• Compliance with corporate policies

Per diem payments served their purpose in the past, but in today’s world, they are no longer fit for purpose. The future is smarter, more sustainable, and cost-effective accommodation management.