Sustainable tourism has become a contentious topic in recent years, prompting the industry to adopt organizational dynamism by integrating big data analytics and verification into their regular reporting processes.

The 54th Annual Meeting of The World Economic Forum that was held in Davos-Klosters, Switzerland from 15th to 19th January 2024 focused on exploring the opportunities enabled by new technologies and their implications on decision-making and global partnership. In terms of sustainability, the forum highlighted the need for a credible business case for sustainability and a holistic approach to sustainability and data management, which would enable organizations to create value while ensuring the well-being of society and the environment. According to a report by the Capgemini Research Institute companies are truly developing in the right direction. For example, the number of executives globally who understand the business case for sustainability has tripled between 2022 and 2023! The report emphasizes that organizations can make a substantial impact by progressing on reporting emissions and implementing and leveraging sustainability management technology.  

Read the full report here: The Future of Growth Report 2024 | World Economic Forum (weforum.org)  

This underscores the significance of the Corporate Sustainability Reporting Directive (CSRD), already making a substantial impact on the Hospitality and Tourism Industry. Despite challenges from international travel restrictions due to geopolitical crises and the effects of Covid-19, the sector, being a major contributor to the EU economy, is expected to rebound and fully recover in the coming years. Projections indicate the industry's economic relevance, with the global GDP contribution forecasted to increase from 9.5 trillion US dollars in 2023 to an impressive 15.5 trillion US dollars by 2033 (source: Travel and tourism: contribution to global GDP 2023 | Statista).

The Tourism and Hospitality sector plays a pivotal role in economic development and achieving Sustainable Development Goals (SDGs), directly aligned with three out of the 17 goals. Direct mentions of the industry are found within Goal 8 (Decent work and economic growth), Goal 12 (Responsible consumption and production), and Goal 14 (Life below water). Despite its criticism for adverse environmental and social effects, the industry must strike a balance.

To manage the economic, environmental, and social impacts of tourism and reach a balance between all 3 pillars, data credibility is crucial! Granular and accurate spatio-temporal data is essential to monitor and sustain various business entities. Indicator frameworks, including the EU standardized framework under the CSRD – European Sustainability Reporting Standards, aim to measure sustainability across environmental, social, and governance (ESG) factors. And we are talking not only about the large industry players, the CSRD will likewise significantly impact SMEs of the industry, that are constituting about 99% of the +2 million tourism businesses in the EU. SMEs must comply with reporting requirements by January 1, 2026, covering a wide range of ESG factors.

Besides the necessary application of the European Sustainability Reporting Standards (ESRS), studies also emphasize the role of industry specific data analytics in helping the tourism and hospitality industry outline data-related aspects in the tourism ecosystem, aiding informed decisions aligned with the SDGs and national sustainability strategies.  

Some of the industry-tailored frameworks worth mentioning are, for example, created by the SASB. The SASB sector specific frameworks provide ESG data through specific indicators, representing a core element of development research and a central pillar of the SDGs. Alongside UN's SDGs, tourism-specific indicators from UN Tourism, Global Sustainable Tourism Council (GSTC), European Commission, and European Environmental Agency (EEA) enhance transparency and accountability.

What is also great about using industry tailored frameworks is that the traceability of the collected data can be supported by various types of assurance tools, such as certifications. Sustainability certifications serve not only as a trusted source of information for consumers who are one of the most important stakeholders within the various types of industry businesses but additionally these certifications can be used to gather information about the status-quo of the business in question, and serve as a gap analysis and support data-based strategic decision making that further accelerates sustainable development. Certifications are regarded as a suitable means to facilitate ecological progress, especially about clean water and energy efficiency, sustainable consumption, and climate mitigation. They can also help businesses demonstrate their leadership and help gain a competitive advantage.  

Beyond institutional labels such as the EU Ecolabel, introduced by the European Commission to highlight resource and energy efficiency and other environmental, social and governance factors, non-profit organizations and private sector entities have additionally introduced green certifications of their own, guiding the hospitality industry towards more sustainable practices. Examples are Green Key, Green Globe, Biosphere or EarthCheck to name a few. On top of that, other tourism stakeholders such as marketplaces have created their own indicative labels, e.g., Booking.com’s Travel Sustainable Level.  

To summarize, the utilization of standardized frameworks for obtaining verified data is deemed crucial in enhancing corporate sustainability endeavors within the Tourism and Hospitality industry. These frameworks serve as valuable tools to clarify information, while also garnering support for strategic decision-making based on data. Certifications, whether from institutional or private sources, play a pivotal role in providing a comprehensive understanding of the current situation and optimal choices within the Tourism and Hospitality sector for all stakeholders. Undoubtedly, the industry is progressing in the right direction!