The hospitality industry is already making solid progress on conserving energy and reducing waste. Now hoteliers have an opportunity to lead the wider travel and tourism sector towards a more sustainable future.
When it opened in 2009, The Crowne Plaza Copenhagen Towers set its stall out to be one of the world’s most eco-friendly hotels. No stone was left unturned to deliver this aim. The building’s façade is lined with solar panels which provide renewable energy. In addition, there is a cutting-edge groundwater system which keeps the building cool during the summer months and warm during the winter months. Add in automatic intelligent light, water, and waste management measures, and there is little surprise that the hotel was voted the world’s greenest just a year after it began trading.
Could such eco-friendly practices become the norm? Certainly for new build projects we will see more and more features installed which reduce the environmental impact. For developments of historic buildings, or where there is a change of use involved, the situation is more complicated due to local regulations and difficulties in applying modern technology to a fabric that was not designed to accommodate it.
Why sustainability in hospitality matters
What there is no doubt about, however, is that pressure is building for hospitality companies to make sustainability a key priority.
And this pressure comes from two angles. First is at a stakeholder level, with the rise of ESG (environmental, social and governance) as investment criteria. We already see this becoming embedded in the United States, and growing fast in Europe, with the UK leading the way.
More pressingly, with energy costs soaring in most major economies, hotels and restaurants which do not take steps to reduce their energy consumption – or find alternative energy sources – will find it much harder to balance their budgets.
Expect to see energy conservation moving sharply up the corporate agenda in the coming months.
In the longer term we will surely see more formal systems and strategies put in place that steer capital towards companies with better ESG performance – and at that point it becomes a game-changer for environmental sustainability programs.
Customers want sustainable business
The other sustainability driver in the hotel industry is, of course, the customer – and in particular the millennials and Gen Zs who are more conscious consumers and who are also fast becoming the dominant market force.
According to a study last year by Booking.com, 83% of global travellers think sustainable travel is vital, with 61% adding that the pandemic has made them want to travel more sustainably in the future.
Hoteliers cannot ignore the needs and desires of the younger generation. When I recently visited Dubai on a field trip with my students, I was interested to discover that the local headquarters for Hilton had appointed a youth board comprising 16 to 22 year olds, which could give a fresh perspective on decisions made by the main executive board.
There is much to learn about this topic for the industry’s future leaders. At Les Roches, we try to contribute to that conversation by setting our MBA students the task of researching what is happening on the ground in the hotel business. Twice in recent years we have published these findings in collaboration with the journal Worldwide Hospitality and Tourism Themes, including an investigation of how sustainability and the UN Sustainable Development Goals can be applied across the hotel industry.
For me, it is essential to have this open dialogue, because the biggest danger for hoteliers is to move too fast for their client base, and to overestimate their commitment to sustainability ahead of the little luxuries we enjoy during a hotel stay. After all, in hospitality customer satisfaction is our license to operate.
Putting innovations under the microscope
We also try to give innovative companies access to our students to cast their educated eyes over new products and services in development.
For example, our students in Marbella recently assessed an innovative body drier developed by the Spanish company Valiryo Technologies, looking at how it would promote sustainability by reducing towel usage, but also whether a valid business case could be made for its adoption within a typical hotel property.
One of the best ways to encourage hotel guests to behave more sustainably is to incentivise them. And one of the big trends I think we will see in the next couple of years is hotel operators incorporating rewards for sustainable behaviour into their loyalty programs.
For example, as part of its Planet21 initiative, Accor has pledged to “involve its customers”. I understand that Hyatt is also considering adding this element to its World of Hyatt program. It will surely take just one operator to formally introduce a sustainability component to its loyalty scheme and the floodgates will open.
What are the jobs in sustainability?
While all the major operators employ subject experts in various aspects of sustainability, perhaps the most exciting opportunities lie among the ecosystem of consultancies and suppliers of innovative platforms in the field of travel, tourism and hospitality.
One such business that I was introduced to recently is TravelPerk, which is headquartered in Barcelona and now has some 800 employees worldwide, having grown exponentially since its launch in 2015.
Although its core service is providing travel and expense management services to corporates, TravelPerk has also developed a new tool – GreenPerk – to facilitate sustainable business travel that reduces the traveller’s carbon footprint by 100%, thanks to offsetting measures involving VERRA-certified projects across the world.
As with everything in business, it pays to follow the money. And with the growing emphasis on ESG there is a lot of funding coming into sustainability, creating fertile conditions for innovation and entrepreneurship.
Can hospitality take a leadership role in sustainability?
I believe the answer to that question is yes; and we are already seeing this through the sharing of best practice at neutral organisations such as the UNWTO and the World Travel and Tourism Council (WTTC).
We also see the wider hospitality sector – hotels, cruise lines, events, and others – taking more of a leading role in educating consumers, in particular around making progress towards the UN’s 17 Sustainable Development Goals for 2030.
Is there more that can be done? Absolutely. With the reawakening of global travel after Covid we will surely see the issue of overtourism back in the spotlight.
The tourism and hospitality industry cannot call itself sustainable while major destinations are choked with tourists; and as we have already seen with cities like Venice and Amsterdam, if the industry cannot control tourist numbers the authorities will do it for them.
As a leading hospitality school, Les Roches is also endeavouring to move the debate along by launching a new Bachelor specialisation in Sustainable Developments and Practices, through which we hope to introduce students to sustainability practices and green initiative, so they can join the debate from an informed perspective when they graduate and get out into the workplace.
We have already come a long way in sustainable practices as an industry; the next generation of young talents must now have the drive – and the tools – to take us further when it comes to striking the perfect balance between guest experience and environmental impact.
Dr Dimitrios Diamantis is Professor and Executive Dean at Les Roches
