Author: World Travel & Tourism Council

Publication Year:

Media Type: Report

Summary:

This report from the World Travel & Tourism Council looks at the impact of envirnonmental and sustainability issues on the future of global tourism.

Abstract:

In a world where our climate is changing and temperature records are being broken with alarming regularity; where 65 million displaced people are fleeing violence, terror, or resource scarcity; and where data and privacy have become powerful new currencies, the purpose of business to help address these global challenges is being questioned like never before.

Societal expectations have changed to the point that a business that simply maximises shareholder value or focuses on short-term gains risks disconnecting with its customers and stakeholders over the long run. Companies are now expected to recognise their responsibility to the world and resources, and address them through the prism of business risk. The Volkswagen emissions scandal and the Panama Papers being two recent examples of how, in our new age of transparency, companies that act outside of society norms are being brought to account.

Increasing the transparency, accountability, and sustainability of corporate processes is happening across the world. While there are many barriers to the mainstreaming of sustainability in business (consumer demand, policy not driving sufficient market incentives, prevailing short termism of financial markets etc.), leading companies are widening their view beyond immediate operational impact and thinking about the broader systems in which they operate. Systems thinking is trickling into these progressive organisations.

Long-termism is also rapidly becoming a condition among the investment community, with the companies that have shown greater honesty about the risks they face reaping higher financial rewards. The clear financial gain that companies achieve when they take a broader view of environmental, social, and governance (ESG) risks compared to a traditional approach was illustrated by a landmark 2011 Harvard Business School study. A more recent example of this was also seen in early 2016 when Larry Fink, the CEO of the investment management company BlackRock, wrote to the chief executives at S&P 500 companies and large European corporations. The letter4 focuses on the problems with short-termism, and asks CEOs to ensure that they better articulate their plans for the future through board-reviewed annual strategic frameworks.

At a more formal level, the near universal signing among country leaders of the UN Sustainable Development Goals (SDGs) and the Paris COP21 Climate Change agreements in 2015 were additional significant moves to bring the issues of sustainability further up international, business, and public agendas.

These international agreements and commitments will bring about the biggest movement towards collective public/private action on sustainability. Trillions of dollars in public and private funds are to be redirected towards the SDGs, creating huge opportunities for companies to deliver solutions. [Introduction p. 1]

Arts & Intersections:

Categories: Tourism, International, Environment and Sustainability