The Climate of Business #63: The journey of decarbonising the travel and tourism industry

Climate Change Reality

The Dead Sea is drying up because of overexploitation and climate change (NPR)

The vital role women can play in climate action (The African Climate Conversation)

How the climate crisis killed the golden toad (The Guardian)

How climate stress contributed to collapse of ancient Egypt (The Washington Post)

Is the world ready for mass migration due to climate change? (BBC)

Barbados spearheads push on climate disaster financing (AP)

A clash over degrees: how hot should nations allow the earth to get? (The New York Times)

Business Climate Reality

European asset managers blame regulatory confusion for downgrade of ESG funds (Financial Times)

Fashion brands grapple with greenwashing: ‘It’s not a human right to say something is sustainable’ (The Guardian)

Asia-Pacific leaders adopt Bangkok goals for sustainability (Bloomberg)

Greener pastures: Is South Africa ready to profit from green hydrogen? (Reuters)

An actual ESG success story? (Financial Times)

The ins and outs of honing ESG training sessions (GreenBiz)

Bankers bet billions on new wave of debt-for-nature deals (Reuters)

In Africa, fossil fuel exploitation is extremely focused on the needs of the West (Le Monde)

Stock bets that wiped out ESG returns may do more harm yet (Bloomberg)

Reality Check

Industry Profile ?

Although history shows people have been travelling ever since we have written historical records, the modern concept of the travel industry started in the late 1940s, especially after the Second World War with a continued growth into what is now called mass tourism.

The travel industry is a complex one as it could be considered to be an amalgamation of several industries - hospitality, transportation, and travel. This setup makes the decarbonisation journey of the industry a rather difficult one. It is one of the industries that is highly vulnerable to climate change as its "product" is the regions, landscapes, nature and species.

Important bodies to know

World Tourism Organization (UNWTO) is the United Nations agency responsible for the promotion of responsible, sustainable and universally accessible tourism.

Global Sustainable Tourism Council (GSTC) is an organisation that establishes and manages global standards for sustainable tourism and travel both for destinations and industries.

World Travel and Tourism Council (WTTC) is a forum made up of members from the global business community and works with governments to raise awareness about the travel and tourism industry.

The Industry & its Sustainability?

The tourism industry's impact on the environment can be difficult to pinpoint. Already in 2018, it was accounting for 8% of global greenhouse gas emissions, with the main contributing factors being transport, shopping and food.?

Although the tourism industry's contribution to climate change has the same impacts as the industries it is composed of, the industry itself actually exacerbates them. So if a region already has an issue with water use and availability, welcoming additional people puts more strain on the state and availability of that resource. For example, just the existence of an average golf course in a country like Thailand has the same water impact as 60,000 rural villagers. The same golf course will also bring in more pollution, needing 1500kg of chemical fertilisers, pesticides and herbicides per year.??

So the true impact of the industry is really hidden in the better or worse management of resources.

Challenges to Net Zero Transition

Sustainability criteria might not always be part of the decision making of the consumer, which of course influences the speed with which the sustainability industry shifts to more sustainable practices.

In a study done by the WTTC, of the 250 businesses analysed, only 42% had defined a climate target and of those only 20% are aligned with the Science-Based Target initiative (SBTi) guidance. If one focuses on local businesses and not bigger chains, one can see why as SMEs usually have a harder time to define and follow a strategic decarbonisation approach, due to the lack of finance or access to knowledge and tools to do so. They need to prioritise their internal budget over financing to support needed net zero investments.

Although in a study made by Booking.com 83% of global travellers voted that sustainable travel is vital and 61% said the COVID-pandemic has made them want to travel more sustainably, in another one done by Skift’s consumer survey, only 14% actually paid for a more sustainable option when travelling.

Solutions for decarbonisation and sustainable transformation of the industry?

Short-term

1. Consumers education and raising awareness

• Active promotion of destinations and greener transport, via deals such as train and hotel getaways; or promoting the visit during so called “off-season” times.
• Education and marketing on sustainable alternatives such as promoting the support of local restaurants and boutique hotels instead of big chains, via blogs, leaflets or books.

1. Support the development of green innovations

• Eg. The GR-eco Island projects, which is turning Greek islands into models of green energy, digital innovation and ecological mobility, with communities owning and operating their own PV station which has lead in the island of Chalki to a reduction of 1,800 tons carbon per year and between 180,000-250,000 euros per year in savings.

1. Create policies and frameworks to avoid and punish futher negative impacts

• Fines for pollution eg in Venice if one is seen swimming or loitering in the waters.
• Restrict tourist accommodation by a certain percentage eg Balearic Islands, tourist accommodation was restricted to 623,000 beds.
• Restrict the use of single-plastics eg don’t offer bottles of waters in hotels, tours
• Focus on carbon-free experiences e.g. instead of having bus and car/bike tuk tuk tours, offer walking or cycling tours.

Long-term

1. Establish a collaboration model between all different stakeholders to achieve this common goal

Such initiatives will need to involve not just travel agents, operators, hotels, restaurants, etc but also governments and local authorities.?The core change really lies into the collaboration between all the local stakeholders. It is here that travel operators, agencies, destinations managers and local authorities can have their true impact as a facilitator and instigator of positive change.

There is a need for enhanced monitoring, alignment, transparency and accountability in terms of both emission monitoring and action.

Carbon Price