Regulatory Pause, Sustainability Pause?: The CSRD Delay and Hospitality's Commitment Test
10 experts shared their view
The European Commission just gave the hospitality industry a reprieve—and perhaps a test.
The European Commission recently adopted a "quick-fix" to the CSRD (Corporate Sustainability Reporting Directive), allowing large companies to delay disclosing detailed sustainability data until 2026. At the same time, a broader "Omnibus" simplification package proposes delaying reporting obligations for SME until 2028, raising company size thresholds, and removing requirements such as sector-specific disclosures and value-chain data. The final EU agreement on the full Omnibus package is expected by late 2025 [1]. The fourth Simplification Omnibus package by the European Commission was introduced as an opportunity to reduce unnecessary bureaucracy and drive innovation, growth, quality jobs, and investment.
In hotels, sustainability action has typically been driven by a combination of "carrot and stick" mechanisms: economic incentives (the carrot), such as subsidies for green technologies and energy-efficient upgrades [2], and regulatory pressure (the stick), such as mandatory reporting, disclosure obligations, and responsible investment requirements. However, regardless of the pace of regulations and the deployment of sector-specific standards and frameworks, studies have shown that urgent, broad sustainability efforts are critical for climate impact adaptation and enhancing asset and destination resilience [3]. Ultimately, building climate resilience is essential for the long-term sustainability and profitability of the sector.
The CSRD delay means hotels can postpone detailed sustainability disclosures, but the question isn't whether they can wait. It's whether they will.
Sustainability won't be achieved through reporting alone, but how is the delay in regulation affecting hospitality brands' commitment?
To understand this regulatory pause's real impact, we need honest reflection:
- In the absence of clear regulation and strong economic incentives, is the industry genuinely continuing to pursue its sustainability goals and agenda? Is there a risk that hotels will deprioritize their sustainability commitments?
- Are there any standout cases or reports that demonstrate real progress and commitment during this regulatory hiatus?
- With tourism growth continuing across Europe while regulatory pressure temporarily eases, what are your main concerns?
[1] European Commission. (n.d.). Corporate sustainability reporting. [online] Available at: https://finance.ec.europa.eu/capital-markets-union-and-financial-markets/company-reporting-and-auditing/company-reporting/corporate-sustainability-reporting_en [Accessed 16 Jul. 2025].
[2] Menegaki, A.N., (2025). Optimizing pollution control in the hospitality sector: A theoretical framework for sustainable hotel operations. Tourism and Hospitality, 6(2), pp.85.
[3] Guerra-Lombardi, V., Hernández-Martín, R. and Padrón-Fumero, N., (2024). Drivers, barriers, and key practices of corporate sustainability strategy implementation in hotels. International Journal of Hospitality Management, 120, p.103791.
“Facing sustainability deprioritization?”
I think the concern is justified since a large section of the hospitality sector has traditionally operated on a ‘compliance-first’ approach when it comes down to sustainability commitments. Without regulatory pressure, we face a clear risk of sustainability deprioritization which means that with one step forward we are making two steps backwards by treating sustainability as – once again – a ‘nice-to-have’ and not a business and societal imperative.
So, the delay raises uncomfortable questions about the industry's true commitment to sustainability. Are hotels pursuing environmental goals because they understand the importance to their business success and thus believe in them, or because they have to report on them? Therefore, any postponement of mandatory reporting provides an interesting experiment: We get to see who maintains momentum when the regulatory spotlight dims.
In any case, those hospitality businesses that have a strong commitment to sustainability have done so before any reporting requirements or other regulatory pressure. Let’s remember that out of the 35 planetary vital signs tracked annually 25 are at record levels [1] – so reporting is nice, but action is what determines the future we hope to have. And the very properties that might benefit most from delaying sustainability investments, including those in vulnerable locations or with aging infrastructure, are the ones that face the greatest long-term risks from the polycrisis.
John Holdren (Barack Obama’s former science advisor) summarized it best:
We basically have three choices: mitigation, adaptation and suffering. We’re going to do some of each. The question is what the mix is going to be. The more mitigation we do, the less adaptation will be required and the less suffering there will be. [2]References:
[1] Ripple, W.J., Wolf, C., Gregg, J.W., Rockström, J., Mann, M.E., Oreskes, N., Lenton, T.M., Rahmstorf, S., Newsome, T.M., Xu, C., Svenning, J.-C-, Cardoso Pereira, C., Law, B.E., & Crowther, T.W. (2024). The 2024 state of the climate report: Perilous times on planet Earth, BioScience, biae087, https://doi.org/10.1093/biosci/biae087
[2] The New York Times (30 January, 2007). World Scientists Near Consensus on Warming. https://www.nytimes.com/2007/01/30/world/30climate.html
The delay to the CSRD may offer temporary regulatory breathing space, but it highlights a deeper truth: sustainability in hospitality and tourism must not depend solely on government mandates. If our industry remains reactive, driven only by compliance, we risk falling environmentally, socially, and economically behind.
This regulatory pause should be a catalyst, not an excuse. We must shift from reactive sustainability to proactive regeneration, working with host communities to restore and renew.
Sustainability maintains the status quo, but that's not enough. Hospitality consumes resources. Now is the time to regenerate ecosystems, supply chains, and community ties and start producing value that lasts.
That means:
- Moving beyond energy efficiency to circular resource systems
- Shifting from carbon offsetting to carbon-positive design
- Reimagining destinations not just as places to visit, but as places to heal and co-create value
Measure and report alternative KPIs:
- Environmental and Regenerative
- Human Wellbeing and Culture
- Guest and Community Impact
Let's use this moment not to wait, but to lead. Forward-thinking hospitality brands must show that climate commitment is not about compliance, it's about conscience, competitiveness, and future-proofing our industry and sectors.
If we wait for the stick, we've already missed the carrot.
Related article by Ioannis S. Pantelidis
Indeed, there is a real risk that goals driven by political ambition, political agenda in the best sense of the word, may be deprioritised. I recently wrote a piece titled "Where Do We Stand Now?" to better understand the current state of play.
At the same time, we cannot overlook the responsibility each individual holds, whether a citizen, a general manager, or an investor. Roles may differ, but what truly matters is individual decision-making, rooted in integrity and values. If we can internalise this mindset and consistently aim for win-win outcomes, we may no longer need regulators to nudge us in the right direction.
Is that idealistic? Perhaps. But I want to believe that it's possible.
For those of us working closely with nature-based tourism businesses, the CSRD delay isn't simply a regulatory matter, it's a test of how we value evidence.
The Long Run's members aren't short on commitment. If anything, there's more resolve than ever to support nature, culture, and communities. The challenge lies in translating that commitment into data, measurable, trackable, and meaningful.
CSRD introduced a helpful structure, nudging businesses to treat data not as a burden but as a tool for accountability, learning, and visibility. It signalled that sustainability isn't just about values, it's about evidence. And that shift matters.
The concern now is that the urgency around impact measurement could soften. Not because anyone is stepping away from their values, but because the momentum built around data collection may lose steam.
That's the real risk. Without data, even the best efforts are difficult to defend, fund, or improve. We can't expect guests, partners, or investors to take our sustainability claims seriously if we can't back them up.
So no, this delay doesn't spell a retreat from sustainability. But it does ask us to stay committed to measurement and transparency, for the right reasons, not just regulatory ones.
The tourism industry is demonstrating growing commitment to sustainability, led by major hotel groups like Ascott, Mandarin Oriental, Barcelo, and Best Western. These companies recognize that sustainability is now a strategic priority, not just a trend. While smaller hotel operators face challenges due to inconsistent regulation and limited financial incentives, industry momentum remains strong. To support SMEs, the GSTC launched the R4MSEC Roundtable initiative to better understand their conditions and promote scale-appropriate implementation of GSTC Standards.
Reflecting this commitment, the number of certified hotels has increased in recent years. In response, GSTC launched the Certified Hotels Directory to help travelers and industry stakeholders identify accommodations verified by GSTC-accredited Certification Bodies. Unlike vague or unverified "eco-friendly" claims, GSTC Certification ensures that sustainability practices are rigorously audited and transparently assessed.
Meanwhile, as tourism surges in regions like Europe and regulatory pressure wanes, some destinations risk returning to overtourism, with places like Barcelona and Bali already experiencing strain. The need for robust destination stewardship is urgent. Sustainable tourism growth requires strategic planning, public-private collaboration, and adherence to credible standards. Only through thoughtful visitor management and local engagement can tourism preserve its long-term value for communities and the environment.
Related article by Randy Durband
For SMEs, this pause has meant that those who require economic incentives or regulatory pressures to act are now not doing anything at all. It has essentially given them a free pass to "continue as usual". Other SME hospitality business owners whose values have always been aligned with running a sustainable business will continue to do so because their ethics require them to. They are looking forward to the standardisation that the cross board voluntary recommendations will bring. Changes to that timeline will not affect what they do or how they do it, in fact they may continue to enjoy greater business resilience and competitiveness while others continue to catch up. In general, the pause has downgraded the urgency around sustainability action in conversations with those carrot-and-stick-incentivised SME hospitality business owners, only time will tell if the business case for sustainability action will recover as we move forward.
Starting with the bright side, these last years' investments in training and development seem to be bearing fruits both at the hotel operator and investor levels. Indeed, when these efforts are underpinned by a good understanding of what is at stake (risk management, asset value preservation, talent and guest retention…) and with a clear strategy, they are typically not abandoned because of the delay in regulation. Some are even dedicating resources to concrete actions rather than reporting efforts.
Banks are also contributing to keeping the momentum alive with the development of sustainability-linked loans which are more regularly offered to hoteliers.
On the other hand, the message sent by this delay, combined with some trends in the US, are surely hindering the acceleration and magnitude of the necessary transformation of our industry.
It's generally unfortunate that very short term considerations are ruling major political decisions while sustainability champions are working hard in the corporate world to advocate for long-term considerations.
My main concern is that scientists and experts continue to notice the predictable effects of climate change and biodiversity loss materialize everywhere, while business leaders are distracted by the wrong discussions.
For Radisson Hotel Group, sustainability reporting is not a new concept introduced by regulatory requirements. The Group has been consistently reporting on its performance in areas such as People, Community, and Planet since 2006. While performance reporting alone may not significantly impact a company's overall sustainability performance, it is evident that what isn't measured cannot be improved.
Sustainability performance requires measurement to reduce environmental footprints, increase social handprints, and enhance the uptake of economic incentives. The recent "quick-fix" to the CSRD by the European Commission, does not negate the progress already made and the ongoing efforts. However, it is crucial to shift from isolated impacts to a broadly applicable scale-up approach that benefits the wider industry. This requires a systemic change to position sustainability as a key lever for business development.
It is also important that sustainability reporting is guided by pragmatic steps to improve performance, rather than complicating the landscape with additional acronyms and abbreviations. Let's keep it simple, impactful, and scalable.
The postponement of CSRD in the EU signals a political failure in planning and policy-making related to a realistic sustainability transition. There is no doubt that excessive regulations such as double materiality, climate and environmental targets in line with EU taxonomy regulations, increasing digitalization, mandatory audits, etc. are hampering hospitality businesses. I believe that the EU's Omnibus package is a step in the right direction, even if it slows down the transition to a more sustainable future. It makes it a little slower, but also more tangible. The EU Green Deal needs to be carefully redesigned so that companies can cope with it and not die because of it. The CSRD and CSDDD are extremely strict directives, which is why companies often see them as a threat rather than a benefit. These demanding EU directives need to be simplified and better focused on a few key areas, such as NZEBs, rather than changing every aspect of a business. By focusing on one or two key areas for a short period of time, with appropriate and significant economic incentives, the transition to sustainability will be less complicated for companies and will enjoy greater support, even in the context of ESG reporting.
The European Commission's delay of the Corporate Sustainability Reporting Directive (CSRD) offers hospitality a breather—but also a test. Without regulatory pressure, true leadership means embedding sustainability into core strategy, not waiting for mandates.
Generic frameworks like CSRD often miss hospitality's operational realities. Hotels are high-touch, energy-intensive ecosystems with short investment horizons (5–7 years), making long-term sustainability hard to prioritize unless there's clear ROI. One-size-fits-all rules risk overlooking what's achievable and measurable in this dynamic sector.
Yet, sustainability is no longer a compliance box—it's a market driver. Travelers increasingly seek hotels that promote wellness and environmental stewardship: 79% value wellness, 76% want sustainable travel, and 60% view eco-friendly hotels as healthier. The $6.3 trillion wellness economy is growing fast, projected to hit $8.7 trillion by 2027.
Consumer perception is shifting too. Research from MindClick and Marriott shows sustainable design signals higher service quality. These attributes now influence bookings, particularly among corporate buyers and eco-conscious guests, leading to higher occupancy, revenue, and asset value.
The CSRD delay is not an excuse to pause—it's an opportunity to lead. Hospitality brands that act now can gain competitive advantage, build brand equity, and drive long-term success through sustainability.
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