Tourism
is often seen as a driver of any country’s economic growth, but current
unsustainable tourism practices can have a deteriorating impact on environment
as well as on the well-being of society in general. That is why more and more
the term ‘sustainable tourism’ begins to buzz around, leading us to the
viewpoint that tourism and CSR are quite
compatible. The report prepared for the Investment Climate Department of
the World Bank provides the following explanation: “Sustainable tourism
development is about making all tourism more compatible with the needs and
resources of a destination area. It is more than just environmental
conservation of a natural area, it must also address the quality of life of
those visiting it and those being visited” (Dodds & Joppe, 2005).
The
problem is that demand for sustainable tourism comes in the majority of cases
not from the customers, but as a result of increased pressure by governments,
NGOs, politicians and other parties. Based on this kind of demand a number of
initiatives were taken. For example, the Tour Operators' Initiative,
in cooperation with the GRI, developed a Sector Supplement to the GRI 2002
Sustainability Reporting Guidelines providing Tour Operators' performance
indicators (Dodds & Joppe, 2005). Forty-seven
indicators were developed to measure tour operators' performance
in addressing the environmental, economic and social impacts of their business
operations.
Among these indicators were, for example, reporting on employee compensation,
donations and other community investments, proportion of spending on
locally-based suppliers, procedures for local hiring, percentage of materials
used that are recycled, energy consumption, water usage, impact on
biodiversity, training programs etc.
Some
businesses develop their own programs which help to spread sustainable
practices throughout their supply chain. For example, Hilton has adopted a new Standard
for Business Partners and Suppliers which includes standards on child or forced
labour, employee representation, health, safety and environmental management,
discrimination, disciplinary practices and employee compensation and working
hours (Dodds & Joppe, 2005).
However,
the progress on implementation of CSR principles seems to be slow. I believe
the main reason for that is the lack of sense of urgency as consumers in their
majority simply do not demand that or are reluctant to pay more for a
sustainable tourism option. From interviews with large operators it was found
out that no specific consumer requests for environmental or social criteria
were enquired about when booking the holidays (Dodds & Joppe, 2005). Thus,
unfortunately, environmental and social criteria do not influence the purchase
decision, as the primary focus is on the price and the second is on quality. Of
course, when asked, consumers may indicate that they expect that their holiday
would not damage the environment and benefit local people through, for example,
jobs and business opportunities, but that’s the responsibly of an operator to
make sure that these criteria are met. Even when given the direct opportunity
to contribute to sustainability, very low percentage of people is interested to
be involved. A good example of that is a program offered by TUI in UK for
ski-holidays tourists to purchase a tree to reduce carbon emissions (a tree + a
map of its location costed just £10)
(Dodds & Joppe,
2005). As a result only 1 in 20 bookings subscribed
for the program, proving a very low participation rate. Thus, it is clear that
there is no connection between consumer motivation and actual purchasing.
Let’s
take a look what is the current
situation with sustainability in China, especially when it comes to hospitality
business and hotels. It is obvious
that hospitality industry in China is rapidly maturing. Increasing numbers of
foreign visitors lead to environmental challenges the country needs to face in
order to create conditions for sustainable development of tourism. It goes
without saying that some strategies are required in order to control energy
consumption, cope with water scarcity, manage indoor air quality, and train
staff in terms of sustainable hotel management.
So,
what does the current situation in China look like? According to a new report
issued by Cornell University’s Center for Hospitality Research in 2016, China’s
hospitality sector urgently needs to address its sustainability. The country’s
hotel development continues at a pace that would see at least three new 150+
room hotels open every day for the next 25 years. It is estimated that China
currently has 2.7 million hotel rooms, but that number is expected to grow to
9.1 million by 2039 (Noordzy, Ricaurte,
James, & Wu, 2016).
Usually
global hotel groups like Accor, Hilton, Marriott which operate in China and
cover 22% of hotel supply, commit to reduce their carbon footprint and
collaborate to reduce the environmental impact of the sector. They see it as a
key driver of their strategic development and a long-term perspective. But this
is not the case with the Chinese smaller hospitality chains or independent
operators who do have a strong sustainability commitment. On the contrary, they
like lavish designs in public hotel areas and lobbies that require high amounts
of energy and water (O'Neill, 2016). Moreover, energy
and water conservation is not a common practice in China, so it is not seen as
first priority by local hotel owners. For example, if we compare water and
energy consumption per square metre and per occupied room in China and in the
other countries, disparities would be quite surprising (see Figure 1). As can be seen, hotel rooms in Germany consume
on average 459 litres per occupied room, compared to 1,555 litres per occupied
room in China.
Figure 1. Average energy and water use per occupied room
in selected countries (source: Cornell University’s Center for Hospitality
Research report, 2016)
Further
comparison of carbon footprints would reveal that “because of China’s reliance
on coal, the countrywide average output of CO2 emissions per kWh of electricity
generated in the grid is over 50-percent greater than that of the United
States, Thailand, and the U.K., and over ten times greater than in France or
Brazil. As a result, the energy comparison of output per square metre or
occupied room demonstrates a greater footprint of CO2” (Noordzy, Ricaurte,
James, & Wu, 2016).
If the hotels that are forecasted to be constructed in China till 2025 increase
their efficiency, this will save the equivalent of 84 million tons of CO2
emission (O'Neill, 2016). Such sustainable
considerations are usually anticipated at the phase of conceptual planning of
the hotel life cycle. However, in China this practice is usually neglected.
Why? There may be several reasons: lack of understanding, misperception of the
cost of sustainability, silo mentality, personal biases. Though the Chinese
government is committed to sustainability, local hotel operators do not see it
as a long-term strategy, so this is something that has to be changed.
In
my opinion it is quite critical for any
organization to work according to CSR principles and disclose the
information about its business practices, environmental footprint, activities
and environmental initiatives. CSR has become a part of strategic competency
and this development is not likely to fade away. By following the CSR principles a company
would not only benefit the society as a whole, but will also get a lot of
advantages for itself (Epstein-Reeves, 2012) (Hensley, 2016):
- Costs savings. Initial investments required for implementation of sustainable processes will repay manifold in the long-run. It can be as simple as using energy saving lamps or as complex as running of a closed water circulation system. Anyway, the costs will be cut and the savings will add up quickly.
- Increase in innovation and creativity efforts. Implementation of CSR principles across the whole supply chain drives the necessity to come up with innovative decisions and creative approaches. This way a company is encouraged to constantly support the research and development efforts and keep leading positions in its sector.
- Improved public image. If company regularly goes public with its CSR information, it gets the image of transparent and honest entity, building trustful relationships with consumers. People would feel good when dealing with the company and this in its turn would increase the customer engagement.
- Investors’ attraction. Nowadays potential investors assess not only sound business plans and budgets, but also a sense of corporate social responsibility. So, if a company demonstrates commitment not only to profit-making, but also to its environmental footprint, it is more likely to get attention and continuous support of investors.
- Employee engagement. When a company demonstrates an aspiration towards environmental-friendly behavior, the employees become inspired and united by the common goal. They feel engaged and productive when working in a positive working environment and feel proud of a company.
It
goes without saying, that control
aspects in the context of CSR guidelines are also essential. The control
can be divided into external and internal. The external control may be carried
out by the government, organizations the company has committed to be member of,
and customers. At the governmental level a company has to comply with, for
example, certain employment practices or safety requirements (WTTC, 2016). As for internal
control, it is carried out by the company itself throughout the whole supply
chain. The purpose of such control is to check the compliance with the internal
rules, regulations and procedures set by the company and react to inconsistency,
if any detected. Of course, quite often multiple stakeholders are involved in
operating of a supply chain, so it may lead to difficulties in controlling of all
elements of CSR. Nevertheless, reporting as a tool of control should not be
underestimated. Such reports can serve multiple purposes: inform employees
about the company’s sustainability policy and encourage participation; improve
reputation and combat any negative perception of the brand; communicate
business practices to other stakeholders all over the world and demonstrate
proactive position; retain investors and attract the new one. Summing up, it is
important to say that all parties involved should coordinate
their efforts in order to harmonize monitoring and reporting tools and reach
consistency in their performance.
References:
Dodds, R., &
Joppe, M. (2005). CSR in the Tourism Industry? The Status of and Potential
for Certification, Codes of Conduct and Guidelines. Investment Climate
Department of the World Bank.
Epstein-Reeves, J.
(2012, February 21). Six Reasons Companies Should Embrace CSR. Retrieved
from http://www.forbes.com: http://www.forbes.com/sites/csr/2012/02/21/six-reasons-companies-should-embrace-csr/#572867324c03
Hensley, L. (2016).
Why Corporate Social Responsibility is Important. Retrieved from
https://doublethedonation.com:
https://doublethedonation.com/why-corporate-social-responsibility-is-important/#corporations
Noordzy, G., Ricaurte,
E., James, G., & Wu, M. (2016). Environmental implications of
hotel growth in China: integrating sustainability with hotel development. Cornell: Cornell
University School of Hotel Administration.
O'Neill, S. (2016,
June 9). Hotels in China must be more sustainable, says report.
Retrieved from greenhotelier.org:
http://www.greenhotelier.org/our-themes/energy/hotels-in-china-must-be-more-sustainable-says-report/
WTTC. (2016). Environmental,
Social and Governance Reporting in Travel and Tourism: Trends, outlook and
Guidance. London.