Why Sustainability in the Hospitality Industry Must be Our Top Priority

As we look forward, past the coronavirus pandemic and into an economic recovery, sustainability in the hospitality industry must be our top priority in accordance with the United Nations Framework Convention on Climate Change (UNFCCC). We draw on the knowledge and expertise from Dr. Emma Wong, Program Director (Postgraduate) at BMIHMS and why this comes into focus on the road ahead.

We are in a moment of unprecedented environmental and climate crisis, and on track to exceed the safe ceiling of 1.5C warming within 12 years or less. However, we are also slowly recovering from a disruptive pandemic at a moment of crucial opportunity.

In an editorial for the Telegraph published last December, Inger Anderson, Executive Director of the United Nations Environment Program (UNEP), explains why we should think beyond going back to normal after COVID-19:

“Normal, therefore, is placing our future in doubt by damaging the health of our species, societies, economies and the planet. We cannot go back to our old ‘normal’. Instead we must go forward, charting a future where we focus our energies on building low-carbon, nature-positive economies and societies.

New climate negotiations are scheduled in Glasgow this year; renewable energy is cheaper than ever before, and business and governments are finally beginning to make deep commitments to carbon neutral targets. Inger Anderson, Executive Director of the UNEP, recently pointed out that coronavirus recovery packages could also be a vital tool for shifting investment towards a greener economy.

But, we cannot wait for change to simply happen to us, whether it comes in the form of new government regulation, escalating costs or natural disasters. Hotels need to take our future into our own hands to ensure the resilience of our industry and the 319 million people it employs worldwide.

We need to step up and become active sustainability leaders, for three simple reasons.

1. The hospitality industry depends on a healthy global ecosystem and is uniquely vulnerable to environmental damage.

Our natural environment is the beautiful destination we offer guests; it’s where the food in our restaurants comes from; it’s the air that our customers breathe and the water they drink.

Climate change and biodiversity loss are two major interconnected environmental issues that have a broad impact on the hospitality industry. Ski resorts in the Alps are losing their snow; hotels on the US coast are predicting flooding, and restaurants are contemplating a mass fish extinction.

In 2019, a survey of airlines and global hotel chains, including Accor, Hilton, Hyatt, Marriott, Indian Hotels and Scandic, revealed a list of the biggest concerns they have about the impact of climate change on their future business. Top on the list were: drought and inadequate water supply, hurricanes and cyclones, flooding, rising sea levels and higher mean temperatures.

These risks are already becoming a reality. In bushfire-hit areas of NSW, hotel research firm STR found that room revenue fell 30% in December 2019, with hotels only half-full on average. The uncertainty of a future with a changing climate also makes it difficult to assess the risks, feasibility and insurance costs of new hotel developments.

Protecting biodiversity is also in the interests of every hotelier. Animals and the ecosystems in which they live are a major reason for travelling, across an estimated 20 - 40% of the global tourism industry. Even if your business is urban, biodiversity ensures that you can put high-quality, varied produce on your tables, among the myriad of other essential, free biological services that biodiversity provides.

2. Customers want sustainable business.

A 2020 study by consulting firm Kearney shows that the pandemic has made consumers even more concerned about the environment when making choices than before. Results show:

• Nearly half say they are more concerned about the environment than before the pandemic.
• 11% have changed their purchases based on environmental claims within the past year.
• In 2019, 71% took the environment into consideration when making choices at least occasionally. On March 6 of this year, 78% felt that way. And on April 10, 83% of consumers said they considered the environment.

This trend towards greener choices is in line with the results of other studies, including a 2017 report which demonstrates that millennials are particularly conscious consumers. Hotels should keep in mind that millennials are also now the biggest market of all consumer age groups.

Sustainable practices in a hotel have a positive impact on customer experience and their likelihood of returning. Going green leads to better loyalty and word-of-mouth marketing, and higher customer satisfaction.

3. The hospitality industry already has a major impact on the global ecosystem.

Right now, the hotel sector accounts for around 1% of global carbon emissions, and this is set to increase as the industry grows.

Research by the Sustainable Hospitality Alliance has found that the hotel industry needs to reduce its carbon emissions by 66% per room by 2030, and by 90% per room by 2050, to ensure that the growth forecast for the industry does not lead to a corresponding increase in carbon emissions.

Hotels can also have a direct negative impact on biodiversity, due to excessive use of resources, purchasing unsustainably farmed produce, waste, irresponsible tourism, and unsustainable design.

Restaurants have a huge role to play in countering biodiversity loss. Food production is the economic sector with the largest impact on biodiversity, contributing 60–70% to date of total biodiversity loss in terrestrial ecosystems, and about 50% of biodiversity loss in freshwater systems.

The hospitality industry is in a position to achieve huge amounts of positive change through the introduction of sustainable design and practises, and without the need to wait for government targets.

But, we can go further than that. We can use our influence to become sustainability champions and ‘third wave’ corporations, driving new ways of thinking and doing business.

In the case of the hotel industry most companies can be described as ‘second wave corporations’, according to a model developed by the authors of “Organisational Change for Corporate Sustainability.”

First wave corporations are those that reject the notion of sustainability, or choose not to take any action. Second wave corporations, although they accept and adopt a sustainability agenda of some form, do it to serve their self-interests.

Marriott’s Serve 360, and Accor’s Planet 21 project (which entails a reduction of food waste, the use of environmentally-friendly cleaning products, and funding of tree planting) are important initiatives in their own right. These programs are a step in the right direction, however, hotels in 2021 need to go beyond initiatives such as these.

To have a meaningful impact on global ecology, we need to adopt a new business paradigm, where hotels would become active advocates of sustainability values and influence their suppliers, partners, customers, communities and governments.

In essence, third-wave corporations go beyond self-interests and see creating a sustainable world as their mission. They use their products and services to help create a sustainable society, and they build networks and collaborate with stakeholders to achieve that goal.

Hotels going beyond the second wave

Leaping from the second to the third wave requires change-leadership and management.  Hotels that are leading the third wave transition have leaders who are devoted to sustainability and have the leadership skills to influence and transform current ethos and practices.

Here are two examples of third-wave hotels. 

Inkaterra 

Established in 1975 by founder José Koechlin, Inkaterra is a pioneering tourism company offering rooms across five hotels in natural locations around Peru. Each eco-resort is built to high standards of sustainability, using local, renewable materials and traditional methods. Inkaterra was the first corporation in Peru to achieve carbon-neutral status in 1989.

However, their sustainability doesn’t end with reducing their own impact, which is why they can be considered an example of a third-wave corporation.

Since its inception, the Inkaterra Asociación has inventoried over 1400 animal species in hotel grounds, created the Inkaterra Canopy Walkway and the Spectacled Bear Rescue Center at Inkaterra Machu Picchu Pueblo Hotel, recorded the world’s largest native orchid collection (372 species) found in its natural habitat, established an international bird-watching competition, and created a nature reserve by purchasing over 1000 hectares of Amazon rainforest. They educate guests and raise public awareness of biodiversity.

Tierra Hotels

“Travel is a tool for change; an opportunity to deepen our awareness and connect with the native beauty of Chile and beyond, because being immersed in nature makes it easier to want to protect it and ensure its legacy lives on for future generations.” - Miguel Purcell, Managing Director of Tierra Hotels.

Tierra Hotels is a small company with three hotels in Chile, all designed to use local materials and minimise energy for heating or cooling. The hotels have their own solar farms and grey water systems, and have begun reforestation projects on their own grounds, reintroducing native species, in addition to planting traditional crops and kitchen gardens for food.

In cooperation with the Chilean Tourist Board and Forestry Association, Tierra Patagonia also actively supports a reforestation project which aims to plant one million trees across Chilean Patagonia’s national parks. They offer ecotourism training opportunities for hotel professionals and workshops for guests.

These two examples of Tierra and Inkaterra demonstrate how sustainability can be embedded within the ethos of a company as a driving force of its activities, with the guidance of committed leadership.

Of course, not every hotel can be an eco lodge. However, many different types of hotels are implementing sustainability plans in response to changing customer demand. Inhabitat lists the world’s 20 greenest hotels every year, and Forbes Magazine has their own list of favourite sustainable hotels.

Hotels around the world are recognised for the work they’ve done to reduce their footprint, through awards such as; the Better World Sustainability Award, the World Travel Green Hotel awards, the Positive Luxury Butterfly Mark and the Eco Hotel of the Year award.

Hotel management schools around the world also have a critical role to play.

Young people today care more about the environment than any other issue, because they know that they will inherit long term disasters such as climate change. The next generation of hospitality students are especially motivated to do business differently. This is why education plays such a pivotal role on the road forward.

“It is not enough to just teach sustainability as a topic or a subject, if we want to nurture sustainability leaders. Sustainability leadership should be a graduate attribute,” says Dr. Emma Wong, Program Director (Postgraduate).

“In other words, upon graduation, students must be able to demonstrate evidence of understanding what makes a sustaining corporation, and application of sustainability as a principle that drives operational and strategic decision-making.”

As Dr. Wong aptly states in her recent article, it has become more important than ever for the industry and education providers to encourage sustainable thinking in our future leaders.

A special thank you to Dr. Emma Wong, Program Director (Postgraduate) at BMIHMS who shared her expertise and knowledge on sustainability for this piece. You can read her full article on sustainability here.