ESG Reporting for Hotels
Post-Covid-19, the Hospitality Industry is now playing a lot of catch-up and adapting to new realities. Riding the changes shouldn’t be scary since many of the same goals are in practice and they remain critical to future success. They keep hotel guests happy and wanting to come back for more. Keeping materials and costs down is directly associated with water reduction, better waste management, and incorporating other environmental initiatives with solid, accurate data reporting. This will give investors, employees, and customers the nice soft-landing leading to something akin to normalcy.
More than ever, hospitality leaders will need to manage risks, make data-informed decisions to maximize revenue and efficiency, create best practices for attaining and reporting on ESG goals, and galvanize prioritization of technological advanced. Click here to learn more about innovations in waste reduction technologies.
In the Hospitality Industry, people are at the forefront of business, and listening to them helps hospitality teams win. So what are they saying? Guests are loudly stating that they value sustainability — 8 out of 10, in fact. Socially responsible investors are also flexing their muscle and demanding functional ESG reporting that align with real advancements. As the hospitality world adjusts to people and planet-centric advances, the UN is also trying to solidify Environmental, Social, and Governance (ESG); the Principles of Responsible Investment (PRI) that themselves grew out of the United Nations Global Compact.
ESGs fit comfortably in the Hospitality Industry
What are hotels offering, after all but a safe, comfortable environment for guests? While also trimming back on waste coming from water, materials, and food, ESG principles go hand-in-hand with a superior operating hotel. When staff is treated well and environmental precautions are taken, you tend to see how guests are treated to more smiles and improved facility maintenance. Often, these establishments see the most loyalty and community pride from customers, employees, and investors. To learn more about how investors are increasingly integrating ESG performance into their investment decisions, click here.
A hotelier’s environment is far more than a room with a lock and bed. It’s a complex organism full of customers, employees, and suppliers, keeping everything functioning. And these days, you not only have conscientious customers, but you also have investors looking to be part of a long-term investment strategy. As a result, sustainability appears to be a watchword along with risk avoidance and return on their investments.
Putting the “E” for Environmental into Hotel ESGs
- Reduce greenhouse gas (GHG) emissions
- Waste minimization
- Carbon neutrality
- Improve energy efficiency
- Water conservation
As we look toward mandatory reporting in the future, the Hospitality Industry can gain advantages by collecting data on the circle of their environment now. Low hanging fruit metrics include energy usage, energy-efficient equipment and its subsequent savings, LED retrofit energy savings, smart and sensor lighting and climate controls, water reduction, waste reduction efforts, composting, recycling, to name a few Hotels can document these basic metrics now for future comparison, reporting, and for PR. These are also the metrics that make guests feel good about booking at a particular hotel.
During the height of the COVID-19 pandemic, hotels gained many “lessons learned” from the fine art of doing more with less. It’s all about improving bottom lines while also improving the impact on the environment. Think of the new technologies that allow for drinks to be poured without your customers having to touch any potentially infected machinery. In some cases, it will enable operators to charge by the ounce. Even if you’ve doubled down on disinfectants, employees and guests might appreciate this safety feature that also helps maintain accurate pricing and stock. Yes, a potential for less labor, and possibly less waste, which also allows for tracking and more accurate data.
Measuring Food Waste
Food waste is on the minds of many policymakers, and just next to energy management, food waste management will become a hot reportable item on most ESG reports. Hotels can help solve food waste with waste prevention vision-enabled tools (think tablets, cameras, scales, and bins) that allow for data collection and the old element of searching for continuous improvement. Food redistribution is another restaurant tool that helps local food banks, reduces waste to landfills, and can be used as a tax deduction. Click here to learn more ways to reduce food waste.
Sometimes it’s the E in ESG that truly stands out because you can make measurable impacts and share those successes with investors and guests. Employees that have become engaged in sustainability initiatives will also be proud to see the metrics of their hard work in action.
Getting the “S” for Social with Hotel ESGs
- Diversity & Inclusion (D&I)
- Human rights
- Fair labor practices
- Health and wellbeing of guests and staff
Corporate and social responsibility begins with integrity; ESGs are about reporting that integrity. Investors and stakeholders are looking for actions to improve diversity, equity, and inclusion (DE&I). Evaluating supplier diversity and seeking like-minded partnerships will enhance society and save the environment. Making your hotel a second home to guests means caring for staff and prioritizing employee health and safety. Reporting on metrics that improve your employee’s lives, like mental health support, might seem intangible now. As we develop better models and assign monetized value, we will begin to see these actions mark a higher value for society, your business, your guests, and your ESG reports.
The “G” is For Governance
- Hotel ethics
- Board member diversity
- Adherences to local standards and regulations
Corporate oversight and keeping leadership on the straight and narrow are critical for hotel ESG reporting. Investors want basics like accurate and transparent accounting with easy-to-understand, meaningful reports. Are hotel practices in line with the country or state’s regulations, primarily environmental and societal rules? Bad or lax governance has shown overwhelmingly that it creates risk and loss of value, decreasing investor confidence. Think Volkswagen Emission Tests and Twitter’s recent security problem. On the other hand, good governance can highlight missed opportunities, such as increasing financial performance by having a diverse team; these methodologies are governance wins for ESG reporting.
Today ESG and its comrade, Principles for Responsible Investment (PRI), are essentially voluntary helpers for the world’s financial markets and economies. Its signatories remain independent from governments while encouraging investors to make responsible investments, allowing for higher returns and improved risk management. PRI doesn’t operate for profit, and while the UN supports it, it is not actually a part of PRI.
PRI has six principles that revolve around ESG issues. Signatories of the PRI have risen from the original 100 in 2006 to 3000 in 2020. Their ideal is to create long-term benefits to the environment through a sustainable, efficient global financial system.
Whether it be PRI or ESGs, reporting on metrics for societal wellbeing and sustainability is quickly becoming the norm rather than the exception for the Hospitality Industry. And while mandatory metrics will be required in the future, it’s predicted that customer and investor demand will more quickly bring the Hospitality Industry to a standardized ESG style of reporting on key metrics.
NWA Makes ESG Waste Reporting a Breeze for ESGs
Our team of sustainability experts at National Waste Associates makes achieving waste diversion goals easy. We also make reporting those advances even easier. Each hotel location in your portfolio has a unique set of circumstances that our experts will identify and leverage while still making multi-site management a simplified process.
NWA does not own any landfill sites, which means we act with integrity for managing your waste and putting it in the best channel to increase waste diversion efforts. Whatever your sustainability goals are, we will help you realize your best waste plan yet by identifying opportunities and partnerships that go beyond reduce, reuse, recycle.
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