Greener growth
Tempting as it is to start talking about futuristic hotels being built on the Moon or under the sea, the fact is that, in 10 or even 20 years' time, hotels will be pretty much the same as they are now. Even the most cursory look back over the past two decades would back up this contention. Other than the gradual decline of chintz and the improved chances of getting a decent espresso or of finding Egyptian cotton linen on your bed, arguably not much has changed. What, then, of the future?
Alongside the increased use of and reliance on technology, one of the major trends will be the rise of sustainable tourism and the take-up of all things green, including greener building styles, greener practices, and the rise of eco-tourism.
But before we all start toasting the altruism of latter-day hotelier saints hell-bent on saving the planet, let us remember that there is an ulterior motive - namely, that it can save cash. As Jan Peter Bergkvist, Hilton International's director of environmental sustainability, put it recently when discussing the firm's reasons for building 10,000 "eco-friendly" hotel rooms: "We didn't do it to be good guys - the reasons we did it are purely financial."
The fact is that it's all about the end result, not the motivation. "There is the good-guy element in all of this but there's also a cost-saving benefit," says Adrian Simpson, director of the recently formed International Tourism Partnership (ITP), which incorporates the International Hotels Environment Initiative (IHEI).
So where is the industry right now? Opinion is divided. Geoff Lane, partner for sustainable business solutions at consultant PricewaterhouseCoopers, is one of the unconvinced. "The sector is some way behind others, like natural resources and even financial services," he says. "There are lots of examples of initiatives in the hotel industry, and there have been for some time, but I would be looking to see these issues of corporate governance and sustainability in all areas of the companies' activities."
Simpson, though, is more upbeat. "From my experience, the majority of the chains are completely with the game," he says. "I'd say the hotel industry, especially the big international groups, is becoming very sophisticated environmentally."
He adds that "hotels are not just hotels any more". Instead, they are very much part of the community and increasingly find themselves involved in social and community issues, such as energy efficiency, water conservation, and reducing carbon dioxide gas emissions. "We want to encourage hotels to become more responsible, and sustainable tourism is part of that," says Simpson. "The hotel industry is in a wonderful position to do something about these issues."
That goes for the independents, too. One good resource for the one-man bands and smaller groups in the UK is the NetRegs website, developed by the Environment Agency and its Scottish and Northern Irish counterparts to help small businesses understand their green obligations and guide them through environmental legislation.
At the moment, a lot of this responsibility is down to the companies themselves. As Lane puts it: "The baseline compliance stuff, you've got to do - the issue is how far you go past compliance." He believes that while most hotels are doing "the obvious things", such as putting up signs in hotel rooms asking guests to only put dirty towels on the floor for laundering, their efforts don't go far enough.
One area that needs more attention is "value chain stewardship". "Hotels have fairly complex supply chains, and they need to make sure that there is integrity in their supply chain," Lane says. "It's not just an issue in their operations."
There's more at stake than being seen to be green. Whereas 10 years ago the principal concern was environmental auditing, nowadays the issue has broadened to incorporate areas such as sustainability and corporate governance. A key driver is corporate social responsibility (CSR) and providing information about your environmental performance and social impact.
"CSR or sustainability is a challenge, given the cost constraints within the industry," says Lane, "but although the initial capital costs can be higher, you can get return on your investment down the line. Hotels need to look long-term." He says that the good thing about CSR is that it forces you to put all of the various strands into a structure and start to think in a holistic way.
He has this advice: "Start out with compliance, then move on to operational efficiency. Then you get into the whole area of strategic advantage, and you start to see companies trying to promote themselves as more environmentally aware and sustainable. It can give you a commercial advantage."
The Department of Trade & Industry claims that going down the CSR route can help companies protect their reputations, improve competitiveness and aid risk management.
That's the carrot; now, here's the stick: hotel companies are under increasing pressure from their guests and employees, who are asking more and more questions about green and sustainability issues. There is also pressure to become more responsible from investors who want the company to become compliant in order to protect the brand and, ultimately, their investments.
Company directors also face increasing liability for failing to operate their businesses responsibly. "It's a board issue now," says Lane. Legislation is another area. Both Lane and Simpson think it "inevitable" that more legislation related to sustainability and environmental issues will be passed.
Back in December, at the International Hotel & Restaurant Association conference in Cairo, the director of the Enterprise directorate-general at the European Commission, Pedro Ortun, said that the European Union would have to look at creating more positive policies around sustainable tourism. Legislation such as the Waste Electrical and Electronic Equipment (WEEE) directive, which became EC law on 13 February and will become UK law in August 2004, will also have an impact on hotels. WEEE requires all companies to safely dispose of electrical goods or face fines.
In future banks may even look more favourably on "green" hotels when they ask for funding, says Peter Anscomb, corporate director of leisure and head of hotel finance corporate banking at the Royal Bank of Scotland. Buyers are also becoming more concerned over such issues. "We're being asked an awful lot now for environmental reports on the properties we sell, whereas a year ago they weren't even mentioned," says Paul Bartrop, a director at property agent Colliers Robert Barry.
The good news is that while Lane thinks that UK businesses are behind on environmental awareness, he believes that, as a whole, they are ahead of their European counterparts when it comes to CSR issues.
More hotels are being built in harmony with the landscape and the environment, rather than being plonked on a spot as if dropped from the sky like a concrete behemoth. There is a growing number of eco-construction specialists, and in recent years there have been advances in the design of more energy-efficient buildings and building materials. More and more companies, such as Banyan Tree Hotels & Resorts, are using fittings made of natural materials such as bamboo and palm, which are not just greener and in harmony with the surroundings but, being sourced locally instead of imported, help support the hotel's local economy.
Witness the rise of the eco-lodge. Hotelier Gordon Campbell Gray, of One Aldwych fame, wants to build an eco-friendly hotel on the Caribbean island of Tobago, and Hilton has unveiled plans for a five-star, 196-bedroom eco-friendly hotel in the Brazilian rainforest. Hilton has even pledged to donate 2% of the hotel's gross operating profit to the Amazon Preservation Fund. Due to open in late 2005, the hotel will be the first of its kind to be operated by an international hotel chain.
But the importance of eco-resorts can be overstated, according to Rachel Dodds, environmental adviser at the ITP. "They say that eco-tourism is the fastest growing segment of tourism, and it is, but it's still only around 2% of the market," she says, adding that there would be more of an impact if a busy London hotel were to become greener and more efficient.
The bottom line is that hotels need to make sure they are not just paying lip service to sustainability but applying a sustainable approach across the business. "It's in [the hotel companies'] interest to address these issues now," says Simpson. "The situation isn't going to go away, it's going to get worse. You're already starting to get travel agents that won't even list hotels that aren't environmentally aware. The bottom line is that costs are going to increase."
And it's not just a question of regulations or risk management. "The danger," says Lane, "is that, in the end, the tourism industry will end up destroying the very thing it is trying to create."
How to be more sustainable
The good news is that "you don't have to retrofit your whole hotel," says Rachel Dodds, environmental adviser at the International Tourism Partnership. She points out that there are lots of low-cost ways of being more sustainable and green. Try changing your lightbulbs for more efficient ones, or set up guest education programmes. "These things don't really cost anything, but the PR can be great," she says.
There are also savings to be had. Energy, waste and water bills together account for 6-10% of the total expenditure in the hospitality sector, says Dodds. Research by the International Hotels Environment Initiative indicates that many hotels which have not yet adopted environmental programmes could save 10-40% on their energy bills, and as much as 25% on their waste bills and 20% on water bills.
Reducing water usage is a key area. Hotel guests use about five times the amount of water a normal resident does, and hotels pay for water twice, as they also have to pay to dispose of waste water. Try using dishwater to water the garden.
A more expensive option is to install a "grey water" recycling system to treat waste water for reuse in the hotel grounds or even in the toilet systems. And dripping taps don't just waste water, they cost you as much as £6 per tap per year. Shelling out on new toilets, showers, taps and boilers will cost upfront but the return on investment can be relatively swift.
Recycling initiatives can also generate cash. For example, firms such as Computacenter will take old IT hardware, clean it and sell it on, giving you a share of the proceeds.
Alternative energy sources, such as solar power or fuel cell technology, are also worth considering.
Some low-cost things you can do today:
Change your lightbulbs for more energy-efficient ones.
Start guest education programmes.
Use waste water such as dishwater to water the garden.
Fix leaky taps and pipes.
Start recycling.
Re-evaluate your supply chain.
Green Examples
The Royal York hotel in Toronto, Canada, has saved Cdn$50,000 (£20,800) just by changing its lightbulbs for more energy-efficient ones.
The London Hilton on Park Lane recently undertook an energy efficiency audit, resulting in a 30% saving in its energy bills for heating and domestic hot water at the hotel, and reduced carbon emissions.
The Accor group in France has installed 1,600sq m of solar panels at 13 hotels and academies, and solar heating now provides for 60% of hot water needs. The company anticipates a return on investment in 10 years.
At the Pool House hotel at Poolewe in north-west Scotland, waste recycling initiatives reduced the weekly output of refuse to landfill sites by 15 bags (or one 1,100-litre bin).
The Four Seasons hotel in Boston, USA, recycles about 2,100lb of paper per week.
The Mayfair hotel in London donates old curtains, bedspreads, half-used shampoo bottles and soap to a local homeless shelter.
The Renaissance Reading hotel has halved its greenhouse gas emissions by installing a combined heat and power plant, which also consumes 40% less fuel than a regular boiler. Total water consumption at the hotel is also down by 22% in the past three years. A recently tested toilet system is saving 81,440 litres of water per year per urinal.
Marriott International is working with its suppliers to reduce waste packaging.
Starwood Hotels & Resorts has installed fuel cell energy systems, which provide cleaner, more efficient energy, at two of its New Jersey hotels.
Hilton International and Scandic have set up an environmentally focused e-learning programme and a reporting tool to enable their hotels to report on their environmental performance.
International Hotels Environment Initiative (IHEI)
The IHEI is a not-for-profit organisation that was created in 1992 by the chief executives of 12 multinational hotel companies with the aim of promoting continuous improvement in environmental performance by the hotel industry. Last November it became part of the International Tourism Partnership (ITP), which was founded to broaden the issue to include the travel and tourism industries.
ITP members include Marriott International, Hilton International, InterContinental Hotels Group, Carlson Hotels Worldwide, Four Seasons Hotels and Resorts, Rezidor SAS, Starwood Hotels & Resorts Worldwide and Accor.
The ITP works closely with industry and promotes best practice and practical solutions to sustainability issues through bodies such as its governing council, the ITP Forum and the IHEI Executive.
There are three levels of membership: platinum for the big international players; gold for smaller, national ones; and silver for individual or small groups.
Resources available from the IHEI:
Greenhotelier magazine (quarterly; costs £10 an issue or £32 for a year's subscription) - offers advice, ideas and best practice.
Environmental Action Pack for Hotels - guide for hotel staff.
Environmental Management for Hotels - industry guide to best practice, published by Butterworth Heinemann (01865 888180, price £160).
The above resources are available from IHEI Orders (01252 669601 or e-mail ihei@mmcltd.com).
You can contact the ITP on 020 7467 3620 or 3622, or by e-mail at itp@iblf.org.
Useful links
www.benchmarkhotel.com - benchmarking tool to help hotels improve environmental performance and make savings
