When hotels promote their efforts to go green and maintain sustainable operations to the public, it’s not just good marketing—it’s good business. Consumers from all walks of life today have an interest in sustainability, especially as they gain a greater understanding of what is required to make hotels and resorts more environmentally sound.
Strong ROI and Better Business Practices
“Hoteliers are business owners, and cost savings translates to a strong ROI and better business,” affirmed Rishi Shah, vice president, global sustainability and ESG, Wyndham Hotels & Resorts. The company’s Wyndham Green Program includes a five-level certification and guidelines to help its franchisees establish best sustainability practices, track utilities uses and be proactive about preventative maintenance.
“A shift to towel and linen reuse has an immediate payback, while investing in energy management thermostats gets a return in just a few years,” he said. “Travelodge by Wyndham hotels in Lakeland, Fla., implemented energy management thermostats, which deliver a comfortable experience by making it simpler for guests to control the temperature. This saves the hotel an estimated 20 percent in utility costs by reducing energy waste in unoccupied guestrooms.”
Sonesta Resort Hilton Head Island’s approach balances financial benefits and environmental impact with short- and long-term returns for the South Carolina property, according to Director of Rooms Michael Insua. Projects that offer the property cost savings in the near term are prioritized, while more extensive projects are assessed for their long-term impact on its carbon footprint and potential future savings. The management’s approach, in turn, aligns the property’s financial goals to create value for its guests, community and natural surrounding area.
“Calculating ROI includes evaluating the payback period and cost savings over time for each sustainability initiative, focusing on energy and water savings,” Insua said. “We also calculated the ROI on LED lighting upgrades by measuring reductions in energy costs, which allows us to prioritize such upgrades across the property. We also look at our carbon footprint, tracking reductions achieved by each new initiative, and use occupancy and operational efficiency metrics to understand how different sustainable practices contribute to overall savings.”
Hilton’s Jean Garris Hand, vice president, global ESG, said her company grounds decisions in data when assessing the ROI of various sustainability projects. Projects include implementing LED lighting and intelligent building management system innovations to reduce operating costs and enhance guest experience.
“By prioritizing projects that offer the most immediate energy savings and operational efficiencies, we can reinvest those savings into larger, more impactful sustainability projects,” she said. “We leverage our data-driven approach [to] ensure we balance environmental benefits with financial performance. (Our) Sustainable Design Checklists provide hotel owners with guidance for making environmentally friendly choices during construction or renovation projects. This takes the guess work out of finding sustainable options and empowers our owners with key information that can reduce operating costs after opening.”
Big Ideas for Smaller Hotels and Groups
Researching and investing in hotel operations can be daunting for smaller hotel groups and independent hotel owners, especially those without the financial infrastructure of a larger chain. This is where global organizations such as GreenKey, Travalyst, Global Sustainable Tourism Council, Green Sign, the World Sustainable Hospitality Alliance, and EarthCheck can help. In addition to promoting sustainability throughout the industry, they offer guidelines and resources to help hospitality companies develop or bolster their sustainability initiatives, evaluate operational and technological upgrades, and provide accreditations for properties whose managements have achieved certain sustainability goals.
The World Sustainable Hospitality Alliance provides a roadmap for hospitality companies and independent hotels in the form of apps, platforms and information exchanges. “We are supporting the industry to manage and report against those standards in ways that will guide [hotel management] to drive better performance for the long term,” said Patrick O'Meara, director of partnerships and business engagement.
O’Meara also shared that in 2025, the Alliance is launching a digital platform and app, which will serve as a practical one-stop shop for hotel managers and staff on all relevant sustainability matters. “Our ‘World Net Positive Academy’ is a powerful online learning resource for hotel managers and their staff to help them understand the key principles and practices in sustainability and relevance to their job roles to support them to make continuous improvement. ‘Net-Positive Simulation’ technology allows decision makers to predict the scale, costs, returns and value of their potential sustainability investments to refine their insights and expertise in making important sustainability investment decisions,” he added.
For global sustainable travel and tourism industry standards and international accreditation for sustainability, hoteliers can look to the Global Sustainable Tourism Council. Industry criteria is set up specifically for hotels, resorts and tour operators. Some guidelines are available free-of-charge for non-commercial use and are offered in many languages.
“Being certified as a ‘sustainable hotel/accommodation’ means that your product or service complies with the highest social and environmental standards on the market in accordance with the guidelines,” said CEO Randy Dubrand. “As public concern grows about the harmful and positive impacts of travel and tourism, certification provides hotels with a credible solution to complex environmental and social issues. With this GSTC-accredited certification, customers and buyers are assured that the business was certified in a credibly verified procedure in a transparent, impartial and competent manner.”
O'Meara stressed that green initiatives across the board have far-reaching benefits beyond safer operations and a better ROI. “Having clever water, energy, carbon, and biodiversity strategies are now critical to a company's ability to thrive,” he said. “Your [property’s] social impact [is] vitally important to the success of your business in the next three to five years. Listen to your guests, especially your business guests, as they expect four things: Knowledge, performance, strategy and commitment to improve.”
Good to Know
- More sustainable hotels don't necessarily mean more expensive stays according to hospitality technology company HRS' 2024 “State of Sustainability” report, which showed that the most energy-efficient hotels offered average daily rates that were 17 percent lower than their least energy-efficient counterparts.
- Booking.com’s 2021“Sustainable Travel Report” revealed 83 percent of global travelers surveyed believed sustainable travel is vital, with 61 percent saying the pandemic has made them want to travel more sustainably in the future.
- “The Hilton “Light Stay” initiative, as applied at Conrad New York Downtown, uses the hotel’s management system to track costs, carbon footprint and environmental operations. General Manager Chintan Dadhich said management can look at utilities’ costs excluding inflation-related year-after-year increases to get insight into usage trends and ROI added from sustainability initiatives.
- Conrad New York Downtown partnered with Brooklyn Grange, America’s leading green roofing company, to operate a 1,000 square-foot organic rooftop farm atop the hotel. While the culinary team advises on what is grown, Brooklyn Grange provides the expertise to maximize the yield and impact of the in-house farm-to-table movement.
This article was originally published in the January edition of Hotel Management magazine. Subscribe here.