In a short answer – compatibility. If you are using Linux, your computer likely already supports Open Document Format through LibreOffice. If you are using a Mac, then Apple Pages is your word processor, and it saves in .pages. A computer using Linux or Windows can not read a .pages file, and even if they could, they will likely not be able to edit the file. MS 365 files while might have some support with other office suites, it is not guaranteed, and even so – there is no version for Linux which might be an option for an employee.
With that in mind, it just makes sense to use the Open Document Format for storing files, and information. Because of that, it just makes sense. If you are unsure if your office suite supports Open Document Format or not, then consider downloading LibreOffice which is available in all OS? platforms (except ChromeOS). Microsoft Word 365 does support Open Document Format files, but some formatting may not work correctly. Apple Pages does not support Open Document Format.