Talking Point: Can SME hoteliers also tackle climate change?

Hotel Floyd: a small business sustainable hotel

Hotel Floyd: a small business sustainable hotel

With big business and governments making climate change commitments at COP21 and small businesses battling extreme weather flooding in the UK and India, Olivia Fussell Managing Director at Carbon Credit Capital LLP asks, is it really practical for small business hoteliers to tackle their carbon footprints?

Climate change is a top of mind issue that business and society are prioritising. A recent poll by the American Sustainable Business Council found that more than half of all small business owners (53%) believe climate change will adversely affect their business. Of those, 19% say that extreme weather events associated with climate change have already affected their operations.

But operational costs are everything in a small business, especially where margins may be narrow. Prioritising guest satisfaction over long term efficiencies is a juggling act all hoteliers manage, even if their goals are to be more sustainable and responsible as a business.

Small business owners can effect meaningful environment change while aligning those principles to their bottom line. The issue is developing the right plan that caters specifically to the hospitality industry.

In the USA climate change’s impact on the travel and hospitality industries is well documented. In New Jersey alone, Hurricane Sandy caused a $950 million loss in tourism. In California, tourism continues to flourish in the Bay Area and Southern California (Priceline reported four of these cities were the top 10 U.S. destinations during 2015 Memorial Day weekend). However, for businesses and communities outside the metropolitan areas, soaring water costs and mandatory conservation rules are affecting the bottom line. If the drought continues for many years or remains permanent, tourism may be the least of California’s problems.

Absent of congressional action, the federal government has placed much of the responsibility on businesses to create their own plans to combat climate change. For large companies like IHG with the central funds to send water-saving kits to all their Californian properties, they were able to take the initiative and act quickly, but smaller hoteliers may struggle to know where to start.

However, SASB (the SEC’s sustainability-reporting standard) has offered some guidance, stating hotel operators “must establish ecological protection and climate adaption plans.” They explain, it is “not only important for minimising costs and protecting revenues, but also has implications for local communities that rely on tourism in such areas.”

Academics, NGOs, and social enterprises often point to the triple-bottom line approach, aligning people, planet and profit. In a joint-study by Virginia Tech and the University of Georgia, the Hotel Floyd was highlighted as an “example of how an initiative initially aimed at eco-efficiency has tangential benefits such as an enhanced corporate image and increased bookings.”

Hotel Floyd, a 16-room boutique located in the Blue Ridge Mountains of Virginia, was built “employing the latest in green technologies, along with sustainable building materials and furnishings.” However, the emphasis is the “competitive synergies that Hotel Floyd experienced from the triple bottom line approach.” Hotel Floyd’s sustainability efforts touched upon all of its stakeholders. They communicated initiatives to staff, resulting in “pride in working for a hotel that resembles the character of the community.” The initiative to reduce water consumption was celebrated by locals because of the county’s scarce resources. Local artists and suppliers were employed, stimulating the local economy. The study concludes that the Hotel Floyd was able to reduce costs, make meaningful impact to the community and environment, and become profitable.

Carbon Credit Capital’s work in the hospitality industry has found that small business hotel operators are a microcosm of Americans. There are some truly exceptional hotel operators that implement a triple-bottom line approach. Some do the bare minimum with cards that nudge guests to opt out of daily housekeeping and implement two-sided printing in the business centre. And there are some that do not factor climate change as an ecological or an economic issue.

Our recommendation to prospective clients is to first, “educate yourself of the facts.” Even if you feel the scientific reasoning behind climate change is unconvincing (although 97% of climate scientists now agree on the global warming trends), then consider the economic imperative. Google, Coca-Cola, General Motors and 78 major companies signed the American Business Act on Climate Pledge, demonstrating their support for action on climate change and the potentially binding climate change agreement in Paris. Or perhaps look to Pope Francis’ moral imperative. At the White House, Pope Francis called for all people to support the international community on climate change action, “so that our brothers and sisters everywhere may know the blessings of peace and prosperity which God wills for all his children.”


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