Sustainability in Global Hotel Industry

Question: Discuss about the Sustainability in Global Hotel Industry. Answer: Introduction Sustainability reporting practices carried out by hotel institutions potentially contribute in enhancing the level of transparency relating to the reporting practices of the hospitality companies. The sustainable reporting practices of the hospitality firms ideally contribute in addressing the information requirements of the stakeholders regarding the accountability of the hospitality firm towards the general society and also towards the natural environment (Sparks Browning, 2011). Further, the sustainability reporting practices of the hospitality institution also contributes in enhancing the brand image of the firm in the international market. It also encourages greater investments from potential investors regarding development and expansion of the hotel firms (Koutroumanis, 2011). Concept of Sustainability The concept of sustainability can be best understood based on the application of the Triple Bottom Line. The Triple Bottom Line or TBL as a phrase was initially coined by John Elkington during 1994. TBL is formulated through the incorporation of three bottom lines where the first bottom line refers to the evaluation of corporate profit; the second bottom line refers to the corporate social responsibility of the firm while the final or third bottom line relates to the environmental responsibility and activities of the firm. The first bottom line thus indicates the profit and loss account of the firm while the second and third bottom line indicates the people and planet account of the business institution. Incorporation of the TBL rightly helps in evaluating the financial, social and also the environmental performance of a business institution (Ye, Law, Gu, 2011). The concept of TBL is also observed as an extension of the Balanced Scorecard principle used in strategic management. In addition to the normal principle of the Balanced Scorecard the TBL further focuses on evaluating the social and environmental impacts of firms. Incorporation of TBL requires the business organisations to meet additional reporting objectives associated with social and environmental objectives that help in addressing the information needs of the different stakeholders. Reporting practices of the corporate firms through the involvement of TBL requires the business institutions to generate effective reports for addressing the information requirements of diverse stakeholder groups. The same also reflects increased accountability of the firms. Further, the use of TBL also contributes in reflecting the fashion the business institutions employ the scarce and economic resources available in the economy (Ladhari Michaud, 2015). Sustainability in Global Hotel Industry The sustainability activities of the hotel industry are observed to attract potential number of customers to the different hotel institutions. The major hotel institutions and potential hotel chains are observed to reflect increased commitments in addressing the objectives of sustainability. The sustainability objectives of the hotel industry increasingly reflect on reducing the consumption of natural resources, generating of cost savings related to reducing the business and organisational cost and also to enhance the skills and productivity of the hotel staffs pertaining to various departments. It also reflects on increasing the levels of diversity in the organisational workplace and loyalty of employees operating in the different hotel institutions (Surachartkumtonkun, Patterson, McColl-Kenned, 2013). The hotel institutions ideally focuses on meeting the objectives of sustainability in that the same contributes in effectively meeting the productivity and efficiency parameters of the hospitality companies. The meeting of the sustainability objectives by the hotel companies are also observed to increase their difficulty meeting the various business and organisational targets in a productive fashion. The case of the multinational hotel company, Marriot can be effectively evaluated in this regard (Giritlioglu, Jones, Avcikurt, 2014). The focus of the hotel institution in addressing cost savings tends to affect its efficiency and productivity parameters concerning customer satisfaction and also responsible sourcing. Further, Marriots endeavours aimed at cost savings also affect the hotel institutions endeavour to sustain effective relationship with its suppliers (Ulyanchenko Ilkevich, 2014). At an individual level the hotel firms focusing on meeting the sustainability objectives are observed to counter from some significant problems underlined as follows. The hospitality institutions face increasing problems relating to scheduling of staffs, meeting of objectives pertaining to work-life balance and also the generation of skill and knowledge development and training programs for staffs. For large hotel chains like Marriott the need to meet the sustainability objectives related to performance, productivity, efficiency and customer satisfaction contribute in sustaining increased level of brand equity for the hotel chain (Magnus, 2016). Hotel companies branded and non-branded also increasingly tend to differ on their sustainability reporting mechanisms. The absence of effective sustainability reporting protocols and standards reflects stark differences in the reporting practices of both individual hotels and large hotel chains. Individual hotel companies generate sustainability reports through the incorporation of statistical graphs and diagrams for enhancing the reporting quality. The global hotel chains like Marriot, IHG and Wyndham Worldwide largely focus on generating the sustainability reports while complying with global guidelines, standards and protocols. The absence of common sustainability and Corporate Social Responsibility (CSR) reporting activities for the individual hotels and hotel chains makes it hard for generating any effective comparisons between the performances, efficiencies and productivity of the hotel institutions and also to suggest for any needed improvement. It is also widely observed that the hotel institutions also lack the need for incorporating any external assessor or auditor to certify the sustainability practices and standards followed by them (Ariffin Maghzi, 2012). Only large hotel companies like Wyndham Worldwide are observed to incorporate external assessors like Deloitte and Touche for reviewing only a single dimension of their sustainability reporting initiatives, Statement of Greenhouse Emissions. The lack of incorporation of external auditors and assessors for reviewing the sustainability reports affect the degree of authenticity and reliability of the sustainability reports published by the hotel institutions. The incorporation of external assessors and auditors for reviewing and evaluating the sustainability reports is evaluated to be both a time-taking and expensive activity for hotel companies. The above issue thereby encourages the hotel companies like the medium and small ones to avoid from incorporating external auditors and assessors to review the sustainability reports (Torres, Fu, Lehto, 2014). Further, the branded hotel chains like Marriott and Wyndham Worldwide are also observed to share different takes regarding the identification of relationship between sustainability and business growth. The management of Marriott tends to identify that meeting of the sustainability objectives contributes in supporting business growth while the management of Wyndham Worldwide observes that meeting of sustainability objectives is best met at times of exciting business and organisational growth(Jones, Hillier, Comfort, 2014). Drivers of Sustainability in Hotel Institutions A large number of factors are evaluated to act as potential drivers that encourage the hotel institutions to adopt sustainability measures for enhancing their operational and business standards. The incorporation of the factors driving sustainability in the hotel companies potentially helps them in meeting the objectives of customer satisfaction and also other performance and productivity objectives (Manhas Tukamushaba, 2015). The different motivators are outlined as follows. Cost Savings The hotel companies focus on generating and sustaining effective financial returns and margins from the amount invested. Different types of cost savings measures are being continually undertaken by the hotel companies associated with energy efficiency, savings of water and other scarce resources and also through effective waste management measures. The cost reduction measures undertaken by the hotel firms based on the incorporation of the above steps is taken to help the hospitality institutions in meeting the objectives of financial sustainability (Toh Potapova, 2013). Structuring of Green Buildings Different types of measures underlined as under contribute in encouraging the development of green buildings. The different measures are indicated as follows: Generation of tax credits rendering of cash incentives for certifying the designs and construction activities of green buildings generation of large scale investments for development of novel and improved infrastructures generation of waivers regarding the development fees concerning the construction of green buildings rendering of loans having low interest, execution and review of plans by building authorities rendering of grants and subsidies for encouraging the development of greener buildings generation of permission regarding additional density are identified as both the financial and non-financial incentives for growth and development of greener buildings (Singh, Kushwaha, Patnaik, 2016). Regulatory Affairs Different types of environmental regulations are developed and targeted for enhancing the sustainability potentials of the hotel institutions. They are identified as management of stormwater, handling of hazardous materials and enhancing the health and safety parameters along the environmental paradigm. Further, different regulations and legislations are developed by the government for helping in the generation of effective hotel designs, construction of green buildings and enhancement of hotel operations. The above regulatory affairs potentially contribute in encouraging the development of large number of green buildings and hotels (Ordenes, Burton, Theodoulidis, 2014). Hedging Against Future Rises of Utility Costs The management of hotel institutions in addition to focusing on cost savings and incorporation of other regulatory paradigms need to effectively incorporate efficient equipments and other tactics for utility generation. It helps in hedging the rises for the present utility costs. The above sustainability measure can be effectively employed by hotel institutions in places suffering from the lack of needed infrastructures to generate needed customer satisfaction through reduction of power cuts and also in enhancement of quality and standards of water resources (Gupta, Arif, Richardson, 2014). Development of the Brand Image Hotel institutions around the globe branded and non-branded, individual and chain are observed to increasingly focus on the incorporation of the sustainability parameters in their annual reports for enhancing their brand image in the larger competitive market. The development of a sustainable and environment friendly image potentially contributes in attracting the mindset of young and socially responsive customers. The management of the hotel institutions increasingly focus on earning environmental and sustainable certification programs that in turn help in attracting prospective customers to avail the hospitality facilities generated by the hotel companies (Manhas Tukamushaba, 2015). Enhancing the Level of Guest Experience The incorporation of sustainability measures by the hotel institutions effectively help in generating quality customer servicing experiences to the different guests visiting the hotels for availing needed hospitality services. Use of energy efficient and environment friendly gadgets in the hotels encourage the stay of prospective customers and guests in the hotels. Similarly, other types of sustainability measures can also be undertaken by the hotel institutions related to the development of the internal acoustic environment through the reduction of noises emanating from the running of fans, boilers and also coolers in the hotel premises (Ratanakomut Kitcharoen, 2013). Focusing on Initiatives for Retaining Employees The hotel institutions need to largely focus on both retaining and training employees such that the same helps in generating satisfied and loyal employees aiming to serve the needs of the customers visiting the hospitality firms. The development of satisfied and loyal employees in the hospitality firms rightly contribute in generating enhanced customer or guest satisfaction and also in reducing the growth of employee attrition levels in the hotel institutions. The same helps in reducing the level of manpower cost for the organisation and thus contributes in generating guest or customer service at affordable costs (Ariffin Maghzi, 2012). Attracting Investors The final motivator that requires the hospitality firms for incorporating sustainability initiatives relates to the need for attracting potential investors. The investors focus on generating increased investments to companies that incorporate different types of sustainability programs for both enhancing and sustaining the performance levels. Existence of effective performance and sustainability indicators for the hospitality companies rightly contribute in attracting significant investments for enhancement of the strategic potential of the hospitality firm (Jones, Hillier, Comfort, 2014). Conclusions The analysis carried out in report ideally reflects on the concept of sustainability while also integrating the same with the concept of Triple Bottom Line or TBL applied by business institutions. Further, the paper also highlights on the application of the sustainability concept relating to hotel companies while also indicating the drivers of sustainability reporting carried out by the hospitality institutions. References Ariffin, A. A., Maghzi, A. (2012). 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