AI, Hybrid Work, ESG Reshape Australian Workplaces

Australian enterprises are reimagining their digital workplace environments through the combined adoption of generative AI (GenAI), hybrid work modes and sustainability-focused innovation, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a global AI-centered technology research and advisory firm.

The 2025 ISG Provider Lens Future of Work Services report for Australia finds that organizations are carrying out digital workplace plans centered on AI automation, employee experience analytics and compliance with environmental, social and governance (ESG) regulations. Many are responding to a national drive for inclusivity, sustainability and decentralization of the workforce.

“Australia has moved beyond global imitation to establish its own digital workplace identity,” said Jason McAuliffe, director and APAC Workplace and Experience lead, ISG. “Local enterprises are incorporating AI ethics, experience design and ESG outcomes into their core technology strategies to achieve both innovation and social responsibility.”

Hybrid work in Australia has evolved into a structured framework, the report says. Australian employers are building inclusive models of work that balance employee flexibility with organizational accountability. More than 80 percent of enterprises have adopted hybrid work modes, and providers have introduced IoT-enabled smart offices, digital twins and tailored, persona-based services to support these. Regional delivery hubs are emerging as part of a national movement to decentralize services and support hybrid work across urban and rural areas. These innovations let organizations maintain productivity across dispersed regional workforces.

Experience management has become a defining part of workplace transformation as Australian enterprises seek to improve employee retention and engagement, ISG says. They are moving from traditional service-level agreements with providers to experience-level agreements (XLAs) to link IT performance with employee satisfaction and business outcomes. Using sentiment analytics, telemetry and omnichannel support tools, organizations are building service environments that can be shaped by ongoing feedback.

GenAI has made the leap from labs to core infrastructure within Australian enterprises, influencing workplace strategies, the report says. Organizations are embedding AI in workflow automation, collaboration and analytics, deploying AI copilots and agentic systems for decision support and knowledge management. Australian companies are focused on maintaining essential governance and transparency, while national initiatives such as AI academies and governance frameworks take steps to ensure responsible AI adoption.