OPINION: Cristina Ramos is the chief sustainability officer for Europe and North Africa at Accor, which operates more than 3,000 sites across more than 40 countries in the region under brands such as Pullman, Novotel, Mercure, ibis, and ibis Styles. In this article Ramos says economics, not just ethics, will drive environmental standards.
The corporate world has seen a subtle but significant “vibe shift” in its approach to sustainability, particularly influenced by political changes. ESG, once a badge of progressive leadership, has faced increased scrutiny, with some corporates pulling back from decarbonisation targets. “Greenhushing”, where companies deliberately downplay or obscure their environmental commitments to avoid political backlash or reputational risk, has become more common.
The prospect of hotel owners slowing the pace on ESG commitments is concerning. But the drive for sustainability will not go away. Why? I believe there is an ever-growing understanding of the need to decarbonise for all our futures and that of our planet. This is not only the right thing to do; it will be heavily driven by economics. The financial forces underpinning sustainability remain robust and increasingly central to investment decisions.
Capital flows towards more sustainable properties
Institutional investors, including REITs (Real Estate Investment Trusts) and private equity firms, are prioritising ESG-compliant properties. These assets attract long-term capital, particularly from pension funds and sovereign wealth investors under pressure to meet sustainability mandates.
Banks across Europe offer preferential rates to hotel owners who meet environmental targets such as reducing carbon emissions or improving energy efficiency. Properties that fall short may face higher borrowing costs or limited access to credit.
Regulatory Pressure
Financial risk is also rising due to regulatory pressure. In the EU, the Corporate Sustainability Reporting Directive (CSRD) requires large companies, including hotel groups, to disclose ESG performance in a standardised format, similar to the Task Force on Climate-related Financial Disclosures (TCFD) rules in the UK.
Non-compliance can lead to financial penalties, higher insurance premiums or exclusion from policies, as ESG data becomes used more in underwriting and appraisals, and even asset devaluation, as buyers increasingly assess sustainability credentials during valuation.
Operational cost savings
Decarbonising hotel operations also brings tangible financial benefits. Energy-efficient technologies, water conservation systems and waste reduction programmes all lower operating costs. Upgrades such as LED lighting, smart thermostats and solar panels reduce utility bills, boosting profitability and asset value.
A competitive advantage
Hotels that operate sustainably also have a competitive advantage, particularly in the resurgent corporate travel market. Corporate clients increasingly choose hotels based on sustainability credentials. At Accor, around 70 per cent of our corporate clients globally have science-based targets, making sustainability a key procurement factor.
Leisure travellers also show growing interest in environmentally responsible accommodation, though at a slower pace. Research we conducted amongst 8,000 European travellers last year revealed that climate change and sustainable options are important to 73 per cent of them – up from 71 per cent in the previous survey (1).
Converting these good intentions into good choices is the responsibility of the industry, by providing clear, actionable alternatives and transparent information, and reducing the impact of operations.
As a hotel brand owner, we see varying levels of commitment to decarbonisation from industry players, but demonstrating positive financial impacts always resonates. That’s why brands and operators must support owners with tools to decarbonise, highlighting the economic – as well as environmental – impact.
Procurement and sustainable operations are essential to control suppliers and service providers’ sustainability credentials to ensure their practices are compliant. Solutions from carbon emission reporting tools and energy efficiency financing to supply chain support, renewable energy agreements, sustainability criteria in brand standards, and AI-driven food waste reduction technology, can help owners through the journey.
Politically-driven noise aside, hotel owners and investors respond to financial imperatives. The financial case for driving environmental standards in hotels is compelling and growing stronger.
(1) European Travel 2025: Balancing Growth and Impact, published November 2024
The views expressed in this opinion piece are based on the observations, experience and belief of the individual author and do not necessarily represent the views or opinions of Sustainable Hotel News.
Accor finds a third of travellers want transparency on sustainable choices
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