Advising a hotel operator on ESG performance and reporting | Sustainable Legacies

For the tourism industry to be economically viable, it must be environmentally sustainable too. Within this context, a hotel operator in Europe wanted to demonstrate its commitment to responsible business by streamlining its ESG reporting, focusing on improving its environmental performance – particularly regarding decarbonisation.

We were appointed to review the ESG landscape and emerging regulatory requirements, the company’s progress and initiatives to date in the context of science-based target setting, and help the client understand alignment with EU Taxonomy requirements.

Bringing clarity to ESG reporting and setting a benchmark

Together with the climate and biodiversity crises, the growing demand from investors, regulators and stakeholders for companies to demonstrate clear ESG performance is leading to an increase of reporting and disclosure frameworks and standards.

The hotel operator therefore sought clarity on the links between standards, notably between emerging frameworks such as the Taskforce on Nature-related Financial Disclosures (TNFD), and the IFRS Sustainability Standards and the European Sustainability Reporting Standards (both of which have the goal of standardising sustainability-related disclosures).

Drawing on our extensive ESG expertise, we assessed the hotel operator’s position within the ESG reporting landscape, reviewing its current performance against external requirements and expectations. Using this information, we produced a gap analysis and a set of key recommendations for improvement.

These not only gave the client a clear understanding of its legislative requirements, but also presented opportunities to showcase environmental best practice and market leadership to key stakeholders by consolidating the findings into tangible actions.

A clear vision for net zero

With plans to reduce energy related emissions by 20 per cent per room sold by 2026, carbon reduction is a priority for the client. Therefore, it was essential to undertake a comprehensive review of existing data and targets on scope 1, 2 and 3 emissions.

Adhering to the Science Based Targets Initiative (SBTi) draft guidance, we conducted a net zero target options assessment and scenario analysis to help the client better understand the implications of different target options.

Helping the client navigate EU Taxonomy

With a portfolio of over 50 hotels and plans for further expansion, the client also needed to ensure alignment with the required EU Taxonomy regulation on sustainable activities.

As this was the client’s first undertaking of an EU Taxonomy alignment assessment, we helped them navigate each step of the process.

This involved undertaking an EU Taxonomy eligibility assessment and developing an alignment assessment process, which we piloted with a subset of the client’s economic activities.

Thanks to our work, the client is now better positioned for future ESG disclosures which can help attract investors seeking verified green credentials.