If Hilton reaches its just announced goal of cutting its environmental footprint in half and doubling its social impact investment by 2030 (see article), it will certainly go down as one of the greatest accomplishments in the history of our industry. The company has given itself some time—12 years is a lot—but doing what it intends to do while growing the brand will not be easy.
Percent reduction goals can be deceiving. It is a lot easier to have large percentage cuts if you are currently performing poorly but not in the case of Hilton; it had already been getting leaner with emissions, waste, energy and water since 2008. Since that year, the company has reduced carbon emissions and waste by 30 percent and energy and water consumption by 20 percent, saving more than $1 billion in operating efficiencies. The tool to track all that is LightStay, a measurement system that calculates, analyzes and reports the environmental impact at each of Hilton’s more than 5,300 hotels. Hilton will use LightStay to track its goal of reducing environmental impact across its portfolio by 2030.
I spoke with Maxime Verstraete, VP Corporate Responsibility at Hilton about the new targets this past week. He said Hilton has been closely following the bigger global conversations about sustainability and climate change—the Paris Climate Agreement and United Nation’s 2030 Sustainable Development Agenda—and wanted to align with those goals.
“We felt that with our size, we have such an amazing opportunity and responsibility,” Verstraete said. “We wanted to take our platform to the next level. We determined we would cut our environmental footprint in half and double the efforts we did in 2017.”
Hotels Have Got to Become More Efficient
How will the more than 5,300 properties reach the company’s goals? First of all, Verstraete said each property is at a different cycle in the journey. Improvements will come with the gaining of efficiencies. Think lighting, heating and cooling, laundry, better food management, etc. Under LightStay, hotels are required to set targets and demonstrate continuous improvement.
“There is going to have to be investment in new areas,” Verstraete said. “Further investment in renewable energy through on-site generation and the energy that we buy and investing in renewable energy credits.”
On the water side, he added, “We know where our top-risk areas are when it comes to water. We need to become smarter about understanding what other entities are pulling from the same water sheds.”
As part of the 2030 goals, Hilton has committed to send zero soap to landfill and reduce plastic waste such as bottles and straws.
Verstraete said Hilton will continue to work with its suppliers to eliminate inefficiencies and improve product quality. “We started a couple of years ago with an assessment of our supply chain,” he said. “We’ve been doing training with [our suppliers]. We started with seafood—getting more certified product into our hotels.”
Unique to Hilton’s commitment is that it is the first major hotel company to institute science-based targets to reduce carbon emissions. The Science Based Targets Initiative currently includes more than 400 companies that have committed to greenhouse gas emission targets in line with climate science.
Beyond Environmental Efforts
By 2030, Hilton plans to double the amount it spends with local and minority-owned suppliers and double its investment in programs to help women and youth around the world.
When asked how responsive franchisees have been to Hilton’s goals, Verstraete said, “We are in constant communication with them. We know this is important to them as well. They understand this is good for business. They understand the value behind this.”
Give credit to Hilton for not only setting aggressive targets but also for understanding emerging and future trends. According to a survey of 72,000 Hilton guests, social, environmental and ethical considerations are central to their buying preferences, especially those younger than 25 years old. In fact, 44 percent of those under the age of 25 research a hotel brand’s environmental and social efforts before booking. Many other travelers in other age groups are doing the same.
It was not highlighted in Hilton’s report but you can bet those looking for a job are also looking at a company’s values before applying. “I am proud to be working for a purposeful company,” Verstraete said.
Last month, Christopher J. Nassetta, President and CEO, Hilton, took over as Chairman of the World Travel & Tourism Council. Then, he joined Patricia Espinosa, Executive Secretary of the UN Framework Convention on Climate Change, to engage travel and tourism industry leaders in a “common agenda” to take action on climate change, implement the Paris Climate Agreement and adopt science-based targets to reduce carbon emissions.
“We want to lead by example and hope to move this entire industry in this direction,” Verstraete said.
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