Today more than ever, the hospitality industry is facing a tough call: How to grow sustainably and thrive amidst volatile times influenced by internal and external factors?

‘Glocal’ challenges, conflicts, disasters and the most recent pandemic have had direct impacts on the hospitality business operations and that travel demand into all destinations. It is a matter for the whole industry to reflect on, address with agility and flexibility.

A common approach taken is globalizing, and centralizing sustainability efforts, without taking relevance of each property and the needs within each of those destinations. While from the corporate standpoint, global issues need to be recognized, on the property levels, companies need to focus individually on tackling challenges happening locally; which in the end, all positively impacts global sustainability targets. There are solutions to many external challenges being faced by the industry, however, they require a switch in mindset from the traditional, standard operating procedures we have become accustomed to. Its high time all of us switch from Global to Local and address each property individually along with its surrounding environment. The external factors further prove why a sustainable business model is not only now mandatory for environmental reasons, but when we are looking at long term costs savings, really it is for the long-term viability of the business and destination it is operating in.

For example, an external factor like rising energy costs is not a high concern for the hospitality properties that are 100% running on renewable energy sources. Similar with managing food supply costs; in the long run it can be beneficial to build and maintain those local relationships with farmers to have a more personal contact in managing produce and costs. Despite the wider industry facing shortages in staff and challenges in retention, not every hospitality business faces this issue.

Businesses and corporation can have a reputation for themselves, and position within a community as the most desired employers, which creates a demand amongst workers wanting to work for your specific hospitality business. The reason for the shortage is due to traditional employee standards and treatment – however, if you adopt a more organic, natural recruitment process, along with ensuring high standards for employee treatments, care, wellness, benefits etc... the shortage the industry is facing doesn’t have to apply to your business.

For us at Kerten Hospitality, our ESG initiative called UBBU (United. Building a Better Universe) helps us instil tools and values throughout all teams and properties in a more organic, natural recruitment process, for instance. We aim to anticipate and be adaptive to the local contexts of each property and local sustainability developments required in future years. This comes done to even assessing the smallest of risks: for example, the effects on guest experiences and satisfactions by adapting to 100% local supplies and amenities. Furthermore, the impacts this will have locally on the people, communities and economic state of the destination. Assessing (local) risks is also heavily connected to understanding the destinations and communities all properties are located in. Connecting to our UBBU Initiative, it is pertinent that the first step before planning, and decision making is Understanding the Destination. How can we affectively tackle and manage risks and challenges in various counties without understanding what those threats could possibly be? And, how it can be effectively tackled on a local level?

A similar approach can be taken with a tool for navigating the volatility – the so called materiality assessment - an assessment that is crucial to implement, but only if done correctly. For one, materiality assessments must be contingent to the company, or meaning that they are able to have a significant impact on specific issues related to the properties. This can be done at both a global corporate level, and at each local individual property level to understand global and local trends, risks, and opportunities. Here, one side of the coin is the financial aspect that firms often prioritize, while the other is the long-term effects of the ESG issues assessed. It is crucial for the understanding and integration of sustainability as a long-term business model, rather than simply integrating a department within the company to work specific on strategies and initiatives.

We as an industry have come far enough to have realized the numerous benefits reaped from these environmental, social, local, sustainability initiatives being driven. The financial and profit-based argument is not validated anymore as research, case studies and recent events have proven to us that in fact, there are long-term positive financial impacts and reputation benefits that come from these various initiatives. The last year of the pandemic highlighted the importance for local community involvement and placing high priorities of employee treatments, care and working standards. We are all about people, and people should be at the core of all we do!