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Welcome to the weekly AST Briefing.

Last week, we had the pleasure of hosting the AST Forum in collaboration with Hospitality Alliance of Subic Bay Freeport Zone.

For this week’s Feature Story, we bring to you the key takeaways from the stimulating conversations we had at the forum.

Future-proofing the Hospitality Industry with Sustainability as a Revenue Strategy

Susan Santos de Cardenas, Southeast Asia Partner & Representative for Green Destinations, was the guest speaker at the forum. A pioneer in sustainable hospitality development and management across Asia, De Cardenas presented data and insights on the commercial benefits of sustainable practices.

The Growing Demand for Sustainable Travel

Referring to the report from Booking.com in 2023, De Cardenas highlighted the increasing consumer demand for sustainable travel options

• 74% of travelers feel an urgent need to prioritize sustainable decisions to save the planet for future generations

• 80% of travelers confirm the importance of traveling sustainably

• 75% seek authentic experiences representative of local culture

• 66% aim to leave destinations better than they found them

• 69% are interested in understanding why specific options are recognized as more sustainable

The Market is Ready for Sustainable Investment

De Cardenas also shared that the investment market is increasingly prepared for sustainability-related products, citing reports from Morgan Stanley, the Global Sustainable Investment Alliance, the World Economic Forum, HSBC, and Intesa Sanpaolo.

• 95% of asset owners worldwide already include or consider integrating sustainable investment in their portfolios

• 57% envision a future when they will only allocate to managers with a formal ESG (Environmental, Social, and Governance) approach

Investments in sustainability have grown by 15% over the past two years. They now account for 36% of all professionally managed assets, with assets under management reaching $35.3 trillion.

Tools for Analyzing and Implementing Sustainability

From assessments like the Good Travel Scan and Climate Action Scan to top-level sustainability certification through the Good Travel Seal, hotels can achieve varying degrees of compliance with GSTC (Global Sustainable Tourism Council) criteria. Level 1 compliance requires 36% alignment with GSTC criteria, Level 2 requires 67%, and Level 3 demands full compliance.

» » Read about the benefits of sustainability certification programs here.

Case Studies

Grand Palladium Riviera Resort and Spa, Mexico

“The commitment to sustainability has saved the Palladium Hotel Group $10 million, thanks to practical measures like watering plants at night and recycling 80% of their water," shared De Cardenas.

Megaworld Hotels and Resorts (MHR)

At the AST Forum in Manila in April 2024, Cleofe Albiso, Managing Director of MHR, revealed that the Sampaguita Project, which involves reviving the sampaguita—the national flower of the Philippines and introduction of a Sampaguita-inspired menu and the creation of a signature Sampaguita scent used across their 12 properties. 

The menu has generated over 2.5 million Philippine pesos (or $42,810) in revenue from food and beverage sales since its launch in September 2023.

Strategies for Future-proofing Through Sustainability

To effectively integrate sustainability into your revenue management strategy, consider the following steps:

1. Conduct sustainability assessments: Utilize tools like the Good Travel Scan and Climate Action Scan to assess your current practices and identify areas for improvement.

2. Set clear goals: Define specific, measurable sustainability goals that align with GSTC criteria.

3. Invest in sustainable technologies: Focus on energy-efficient appliances, renewable energy sources, and water conservation systems to reduce operational costs.

4. Gain a certification:  Validate your sustainability efforts and attract eco-conscious travelers.

5. Engage stakeholders: Involve staff, guests, and the local community in your sustainability initiatives to cultivate and promote a culture of environmental responsibility.

By adopting these strategies, hospitality businesses can enhance their profitability and at the same time, contribute to a more sustainable and resilient industry.

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