Environmental Management Systems in Local Governments

Introduction

One of the outcomes of the 1992 Earth Summit conference was Agenda 21, a global consensus and political commitment at the highest level. Article 28 of Agenda 21, states "local authorities construct, operate, and maintain economic, social, and environmental infrastructure, oversee planning processes, establish local environmental policies and regulations, and assist in implementing national and sub national environmental policies. As the level of governance closest to the people, they play a vital role in educating, mobilizing, and responding to the public to promote sustainable development" (UN Conference of Environment and Development, 1992). With this broad statement, the United Nations Earth Summit recognized the importance of implementing policy at the local level and of supporting local levels of government to implement global environmental mandates. It also identifies local authorities as the sphere of governance closest to the people, and calls upon all local authorities to consult with their communities and develop and implement a local plan for sustainability, a “Local Agenda 21”. At the summit's closing session, the Secretary General of the UNCED pointed out: "If sustainable development does not start in the cities, it simply will not go. Cities have got to lead the way."

Indeed, after the UNCED's recognition of local authorities, more than 60 developing and transitional countries were already turning key planning and management functions over to local governments (World Bank 1993). Local governments have taken action to address these new mandates through local sustainable development planning processes. More than 1,500 local governments from 49 countries have established "Local Agenda 21" processes to implement the UNCED's Agenda 21 (ICLEI/CSD 1996). Local Agenda 21 is a program that provides a framework for implementing sustainable development at local level. LA 21 aims to build upon existing local government strategies and resources (such as corporate plans, vegetation management plans, and transport strategies) to better integrate, economic and social goals. In this effort they usually implement Environment Management Systems (EMS) following the guidelines from some of the internationally known systems, such as the European Union Eco-Management and Audit Scheme (EMAS) and/or the standardized ISO 14001.

In the last 10 years an increasing number of public sector organizations, among them local governments /authorities, in countries around the world have engaged voluntarily with implementation and use of Environmental Management Systems (Burstrom, 2000a).

An Environmental Management System (EMS) is a tool that enables an organization of any size or type to control the effect of its activities, products or services on the natural environment. An EMS ultimately supports environment protection, biodiversity, conservation, ecologically sustainable development and resource sustainability. The primary element of an EMS is determining which aspects of the organization incur environmental impacts. Once identified these components are systematically managed to achieve a better control and performance. The EMS Management cycle can be thought of as a ‘Plan, Do, Check, Act’ (PDCA) process of continuous improvement, aimed at improving business and environmental performance.

The kinds of EMS being implemented in municipalities in Europe and other countries of the world (i.e. EMAS/ISO 14001) were primarily developed for needs and purposes in industrial and business organisations. Thus, they could be associated, in particular, with the administrative aspects of municipal environmental management; that is, the internal work within each municipal committee, administration or company. The transfer of EMS from the private business world into a new management technology in public organizations could be seen as a reasonable trend. However, it raises questions to the reasons for implementing an EMS and about the roles and effects of an EMS in public sector environmental policy and management. With the expectations on local governments/authorities to play an important role in the transition towards sustainable development, expressed, in the Agenda 21 document of the Rio Earth Summit, it is my particular interest to analyse the use and potential of EMS in local government and authorities (municipalities). Why are they using EMSs and what are the different aspects and components of local government EMS?; what are the strengths and weaknesses of this management technology in municipal environmental management, with sustainable community development as an ultimate goal?

The role of EMS in Local governments

Today, an EMS can generally be defined as: “ That part of the overall management system that includes the organisational structure, planning activities, responsibilities, practices, procedures, processes and resources for developing, implementing, achieving, reviewing and maintaining the environmental policy”. (Regulation (EC) 761/2001, Official Journal Of European Communities no. L114, 24 April 2001, pp. 1–29, Article 2k)

This definition applies in particular for the European Union EMAS regulation, but the definitions according to ISO 14001 and the former British Standard BS7750 are similar. In general, an EMS aims to provide management and work arrangements that enable the organization to exercise effective control over the implementation of environmental policies.

EMS it is constituted by different elements, stages connected in an iterative loop, following the Plan–Do–Check–Act (PDCA) procedures and principles of total quality management with ‘continual improvement’ of environmental performance and the management system itself as key. Gilbert (1993, 7ff.) has summarized the basic stages of an organization’s EMS:

• A policy statement indicating commitment to environmental improvement and conservation and protection of natural resources;

• A set of plans and programs to implement policy within and outside the organization;

• Integration of these plans into day-to-day activity and into organizational culture;

• Measurement, audit and review of the environmental management performance of the organization against the policy, plans and programs;

• Provision of education and training to increase understanding of environmental issues within the organisation;

• The publication of information on the environmental performance of the organisation.

In order to understand why and how municipalities implement and use EMS in their environmental management and, eventually, management for sustainability, it is important to consider the role of EMS.

Environmental Management Systems (including EMAS and ISO 14001) are tools/techniques that include several other tools, such as monitoring, policies, action programs, auditing, reporting and so on. EMS provides a set of management methods for achieving continual improvement in the environmental performance of organisations. The process assists organisations in implementing environmental policies and provides the means for evaluating whether desired outcomes have been achieved and reviewing whether changes to policy direction are required. The EMS process assists organisations in managing their assets in an economically and environmentally sustainable way.

Furthermore, they are all built on the basic management loop and the PDCA cycle underlying most management systems in the business world. Thus, a municipal EMS can be considered as a management technology that co-ordinates other tools for municipal environmental policy and management (cf. Erdmenger, 1998a) that is, a toolbox for municipal environmental management. Each of the coordinated techniques should fulfill the requirements in a certain step of the basic management loop, on its own or in combination with other techniques. The process also enables organisations to manage risk and due diligence issues and to monitor and assess environmental impact within a systematic framework. As such, the EMS process is defined by the International Organisation for Standardisation (ISO) as part of the overall management system that includes organizational structure, planning activities, responsibilities, practices, procedures, processes and resources for developing, implementing, achieving, reviewing and maintaining the environmental policy (ISO, 1996).

Implementing Local Government EMS in Europe and Australia.

The implementation and use of formal EMSs in local public administration on a wider basis started off in the UK with the adaptation in the early 1990s of the EU EMAS to local governments (LG-EMAS; Dof et al., 1993; McIntosh & Smith, 2001a). As reported by Riglar (1997), about half of the UK local authorities were underway to establishing EMSs in their organization in 1996. As discussed by Aall (1999) some Norwegian municipalities have, since 1993, been experimenting with so-called municipal eco-auditing, which is somewhat related to the UK LG-EMAS (cf. Barton & Bruder,1995). Similar projects were running in Denmark and Finland, too, in the mid-1990s (Riglar,1997, 312ff.). Regarding the situation in Denmark, it is interesting to note that the City of Copenhagen (1999) intends to seek registration with EMAS for the entire city, including its citizens, by the end of the year 2003. As reported by Bekkering & McCallum (2000), a small but growing number of municipal administrations in Canada are using the ISO 14001 standard. ISO 14001-type EMSs are also being implemented in municipalities in New Zealand (Cockrean,1999), the US (US EPA, 1999) and Australia (Port Phillip’s, Frankston and Manningham among others)

As mentioned, in the case of the UK, EMAS was adapted specifically for use in local authorities quite early. The British LG-EMAS, differs from the original EMAS in three ways (Netherwood & Shayler, 1996; Riglar, 1997). First, it applies to operational units such as departments, divisions and/or service functions instead of sites. Second, both systems allow a single site or operational unit within a company/municipality to seek registration, but the LG-EMAS requires that a local authority must not only have a corporate policy if it would register, it must also establish a ‘Corporate Overview and Coordination System’; that is, a set of management responsibilities, structures and procedures for environmental management at the corporate level. In comparison, a company is only required to have a satisfactory environmental policy at the corporate level. Finally, local authorities have to focus upon the indirect environmental effects associated with their service deliveries, in addition to the ‘direct effects’ on the environment.

In Australia the activities towards EMS have grown with at least 20 councils involved since 1995. In Victoria the interest in EMS has moderately increased since 1998, when Lyon et al (2002) report five Victorian municipalities had developed an EMS. In 2002 the number had risen to eight, and eleven by 2005, being the second least common strategy, occurring in 11% or fewer councils (Rogers et al, 2006).

The Australian Local Government Association (ALGA) and the Institute of Municipal Managers, have embarked upon a project program to develop a model approach to EMS for Local Governments (see Maher 1996). An element of the project is to explore how environmental Management responsibilities can be better integrated into council corporate Management and planning. ISO 14001 has been adopted as the basis for the local government model because of its flexibility, durability and wide recognition. Thomas et al (2005). As part of their 2001 National Agenda, ALGA (2003) asserts:

9.2- Local Government will continue to promote integrated, strategic approaches to environmental management, including the application of Environmental Management Systems to Councils operations.

To support this the ALGA website provides a broad guide for municipalities developing EMSs (ALGA 1996). Elements of this were evident in the case of the Redland Shire Council EMS (Mckim 1998). Experience with the development of the scheme provided some directions for other local governments authorities, but particularly identified a number of clear benefits for the Shire, including: Identification of environmental risks; reduce risk of environmental incidents occurring; providing senior managers with due diligence protection; improving communications; improving operational processes; saving money; and improving the Shire’s corporate image.

An interesting example of the use of an EMS is the city of Manningham, which did not adopt the standard off-the-shelf approach to their EMS but instead, with the initial strategic input of Green Innovations, created an EMS that meets their specific needs. EMSs were developed in manufacturing and resource processing industries and tend to concentrate on cost savings, corporate responsibilities and legal liabilities. A different approach has been used in the city of Port Phillip (Victoria), where the affinity between the local conservation strategies (LCS) approach and that of the EMS has been used to develop a Sustainable Development Strategy for the city. This strategy, which embodies aspects of the approach of an LA21 is not in itself an EMS, but is “a strategy designed to enable development of an ISO 14001- based EMS, which in turn will facilitate implementation of the strategy” (Osmond 1996, mentioned by Thomas 2007). Councils therefore, should be able to develop modifications to the currently available EMS options, especially because of the wide range of environmental matters they cover. Taking a sustainability approach meant building into the management system economic, social, cultural and ethical considerations, which are not the domain of a typical EMS. (Our Community Our Future, 2000)

Environmental Management Systems and Local Agenda 21

The UK local government adaptation of EMAS was an early attempt to help local authorities manage their environmental impacts in a systematic way and also to fulfil their responsibilities under Agenda 21, as mentioned by McIntosh & Smith (2001a)

The recent reshaping of EMAS, allowing all kinds of organizations to register after third-party verification, may open up new areas of application for this kind of EMS. Here, the outcomes of the efforts of the City of Copenhagen would represent a good measure of value of the feasibility of EMAS 2 as a ‘universal’ EMS. The overall aim of a municipal EMS would be to perform an integrated and organized management function in the local administration and, desirably, in the local community, for providing a strategic methodology for assessing environmental impacts, for coordinating environmental activities and for facilitating development, implementation and review of municipal/local overall and integrated environmental policies and goals (cf. Netherwood & Shayler,1996).

In relation to this, it should also be mentioned that Levett (1997) has sketched the potential relationship between LA21 and the ‘management-by-objectives’ approach associated with LG-EMAS as well as ISO 14001. He argues that the LA21 process, ideally, should guide the municipality’s internal management processes, in that:

· The municipality’s environmental policy should reflect the vision for the future generated in the LA21 process.

· The municipality’s environmental programme should include actions allocated to the municipality by LA21 working groups.

· The municipality’s audit of its management system should use criteria set by LA21 stakeholders.

· The municipality’s Environmental Statement should be designed to provide the performance sought by the LA21 monitoring process (Levett, 1997, p. 194).

Though, Levett admits that, in most places, the LA21 is not yet strong enough in political legitimacy or well enough developed in its own management process to have this much influence over the municipality’s internal environmental management. To some extent it actually seems to be the other way around. Instead, municipalities, in UK as other European countries such as Sweden and Denmark tend to see the work with EMS as their main way to address LA21 (Burstrom, 2000b; Dalin-Akerlund, 1999; Emilsson & Hjelm, 2002a, 2002b; Riglar, 1997; SALA, 1998).

Contributions and Pitfalls of EMS in Local Governments

Despite the relatively large interest in EMS shown in municipalities, for instance in Europe and Australia, it seems to be still very few municipalities that have actually implemented an EMS to its full extent and that have worked with them for a long period of time; especially when it comes to implementation in the entire municipal organization (Malmborg F. et al 2003). It seems that many municipalities have high ambitions when they start, but that lack of funding, lack of support from senior politicians and council officers, and municipal reorganization or other factors hinder them to ever implement the EMS (e.g. Bekkering & McCallum, 2000; McIntosh & Smith, 2001b; Riglar, 1997). Therefore, there is little material to study in order to get a comprehensive picture of the outcomes, especially the long term effects, from use of EMS in local authorities. To this can be added that there has been little research on this topic. So far, most research on municipalities, environmental management and sustainable development has been devoted to LA21.

However, the UK local government management board (LGMB, 1996) has identified several benefits of the LG-EMAS from case studies in UK local authorities. These involve compliance with policy and legislation, improved service delivery, cost savings in the organization and raised staff awareness, of which the latter two, in particular, are important for the municipal capacity to control environmental problems. To this can be added that the implementation of LG-EMAS has made local authorities “ask the right people the right environmental questions at the right time” (Riglar, 1997, p. 328), thus reducing the amount of staff time wasted on managing environmental issues that could and should have been foreseen. Taylor (1994) suggested that the corporate nature of LG-EMAS helps to get over the problems of isolation and lack of influence that many environmental officers and green teams have experienced in local government, and that it would achieve a clearer structure and rationale for participation in environmental management throughout the entire municipal organization; all in all facilitating the integration and coordination of environmental management actions. In a case study of EMAS implementation in Hereford City Council, the first local authority in Europe to gain EMAS registration for all its departments and services, McIntosh & Smith (2001b) report that the work with EMS resulted in more ‘environmentally friendly’ citizens following education programs and a new city-wide recycling system. Other benefits experienced in Hereford city were improved management systems, including better systems of monitoring and reporting, also on other issues than environmental. Third, Hereford City Council gained enormous credibility both with its own citizens and with other parties in the country, thus serving as a good example and role model for others to follow. Continuing with UK experiences, Netherwood & Shayler (1996), as well as Rowe & Enticott (1998), discuss how municipalities that have implemented EMS assist small and medium-sized companies within the municipal territory in their efforts to implement EMS for improving the environmental performance of the companies. Working with EMS has made local authorities more prepared to work in cooperation with, instead of ‘against’ local industry and business and, thus, to exercise a new role in environmental management (i.e. a mutually dependent co-operator; Burstrom, 2000a; Dobers, 1997). This would be highly beneficial for municipal capacity building as they increasingly need to cooperate with other actors to solve most problems related to environmental management in the local community (Burstrom, 2000a).

It should also be mentioned that environmental management systems like ISO 14001 and/or EMAS are just tools for environmental management, and not general solutions or panaceas.

An EMS generally aims at pulling a potentially unequal system into an integrated and organized whole, covering not only management’s responsibility for the environment, but the responsibilities and tasks of every individual in an organization (Welford & Gouldson, 1993).

Thereby it would potentially help to organize and systematize the environmental management tasks in an organization. However, there is no guarantee for a transition to an environmental culture or a task culture and successful corporate environmental management focusing on experimentation and fundamental change from implementing an EMS (Moxen & Strachan, 2000). The EMS constitutes a structure only, which must be filled with substance in order to contribute to the overall objectives of municipal environmental management. The outcomes are highly dependent on what content is put in the system, especially with regard to environmental performance (cf. Levett, 1996).

Here it can be mentioned that a common critique of ISO 14001-type EMSs is that they lack mandatory aspects of environmental performance; each organization implementing an EMS can choose what environmental aspects to include in the environmental policy (e.g. Sheldon, 1997). Unless there is also a fundamental shift in the values and ethics of the organization towards environmental excellence the success of the EMS will be limited (Netherwood, 1996). Finally, it should also be stressed that the use of EMSs at best can only help a municipality and its organizations to improve their environmental performance. Working with EMS, when fully implemented, and eventually achieving an ISO 14001 certification or an EMAS registration, means that the municipality/organization is somewhat better prepared to manage its environmental aspects. But it does not necessarily mean that it is a sustainable organization or that the local community will be sustainable.

References

• · Fredrik Von Malmborg, 2003. Environmental Management Systems: What is in it for Local Authorities?, Journal of Environmental Policy & Planning, Volume 5, Issue 1 March 2003.Routledge Taylor & Francis Group, accessed through Informa World

• · Roge, Atkinson, Kendrick, Hamm and Raffe, 2006. Victorian Local Government Environment Management Survey: Programs, Resources and Management Approaches. Municipal Association of Victoria, Melbourne.

• · Thomas I. 2005. Environmental Management : Processes and Practices in Australia. The Federation Press, Sydney.

• · Thomas I. 2007. Environmental Policy: Australian Practice in the Context of Theory.The Federation Press, Sydney.

• · Brugman Jeb, 1996. Planning for Sustainability at the local Government Level. International council for local Environmental Initiative, Toronto.

• · Environmental management systems -requirements with guidance for use. Australian/ New Zeland Standard ISO 14001:2004.

• · Our Community, our Future: A guide to Local Agenda 21. The local Government Environment Australia, 1999.

• · Rowe & Enticott, 1998. The role of Local Authorities in improving the environmental Management of SMEs: some observations from Partnership programmes in the west of England. Eco Management and Auditing, Volume 5, issue 2, Pages 75-87, accessed through Inter Science.

• · Burstrom Frederick, 2000. Environmental Management Systems and Co-operation in Municipalities. Local Environment, Volume 5, issue3, August 2000, pages 271-284. Routledge Taylor & Francis Group, accessed through Informa World.

• · Bosworth Tony, 2007. Local Authorities and Sustainable Development. European Environment, Volume 3 issue1, pages 13 -17, Accessed through Inter Science

• · EPA/MAV, 2001, Case 3. Local Government and Environmental Management Systems (EMS). Local Government case study in EMS

• Links

• · United Nations Environment Programme on EMS

• http://www.unep.or.jp/ietc/publications/techpublications/techpub-14/1-EMS1.asp

• http://www.unep.or.jp/ietc/announcements/emskit_launch.asp

• · UN Department of Economic and Social Affairs. Division for Sustainable Development. Agenda 21 http://www.un.org/esa/dsd/agenda21/res_agenda21_00.shtml

• · EU - ECO Management and Audit Scheme (EMAS)

• http://ec.europa.eu/environment/emas/index_en.htm

• · Department for environment food and rural affairs (UK)

• http://www.defra.gov.uk/environment/business/scp/actions/ems.htm

• · Environmental Protection agency (US)

• http://www.epa.gov/ems/

• · EPA (US) Public Sector

• http://www.epa.gov/ems/resources/casestudies/publicsector.htm

• · ICLEI, Local Governments Sustainability

• http://www.iclei.org/index.php?id=iclei-home

• · Cities alliance

• www.citiesalliance.org

• · Metropolis: The World Association of Major Metropolises

• www.metropolis.org

• · Multilateral Environment Agreements

• http://www.gdrc.org/uem/mea/star.html

• · Department of the environment, water, heritage and the arts (Australia)

• http://www.environment.gov.au/sustainability/government/ems/index.html

• · Municipal Association of Victoria (MAV)

• http://www.mav.asn.au

• · United Cities and Local Governments

• www.cities-localgovernments.org

• · Australian Local Government Association

• http://www.alga.asn.au

• · Local Government Victoria

• http://www.localgovernment.vic.gov.au

• · EPA Victoria

• http://www.epa.vic.gov.au/

• · Local Agenda 21. Department of the Environment, Water, Heritage and the Arts. Ecologically Sustainable Development. Australian Government.

• www.environment.gov.au/esd/la21/index.html

• · Environmental Management Systems Association Australia.

• http://www.ems.asn.au

• · EMS in the Public sector

• http://www.gdrc.org/uem/iso14001/case-studies/cases.html

The Importance of sustainability in the Australian hospitality industry

This essay will examine the concept of sustainable development in the hospitality industry in Australia, in order to address the following questions:

• How the concept of Sustainable Development / Sustainability is applied to the Hospitality Industry in Australia?
• Have this concept been modified according to the Brundtland definition?
•  How is the sustainability and environmental issues addressed in these organisations?
• What is the role of sustainable development in their CSR strategies and reports?
• How sustainability reports and strategies affect their core business?

The general objective of the essay is to assess the concept of “Sustainable Development” used for hospitality organisations in order to articulate a constructive criticism and provide potential directions in their corporate social responsibility (CSR) strategies. I am choosing this industry because I have some experience in the Hospitality Industry and I have seen the amount of waste they produce, I also think this is a good example to illustrate how companies can improve their systems and processes throughout sustainability practices.

Sustainability in the Hospitality Industry Overview

By definition, Hotels and resorts are establishments that are licensed to operate a public bar and provide accommodation on a room and/or suite basis, with a bath and /or shower and other facilities in most guest rooms.
According to IBIS world report the hospitality industry in Australia is dominated by six (6) international groups that control 24.3% of the national market: AAPC Limited (Accor Hotels) with a 8.1% of the market share; Mantra Group Holding I PTY, with a 4.1%; IHG Hotel Management (Australia) Pty Limited, with a 3.1% ; Thrakal Holding Group (Sofitel) with a 3.1% ; Hilton Hotels of Australia Pty with a 2.5%; and tourism asset Holding Limited with a 2.4% of the market share. In order to keep this essay within the words limit, I will examine some of the CSR strategies of the main groups to understand what is the meaning they give to sustainability and /or sustainable development in their organisations, considering they are the market leaders and represent a benchmark within the industry, in order to evaluate, compare and critique them. 

According to the 1987 Brutland report, Sustainable Development is a Holistic concept based on a simple principle, “ It is development that meets the needs of the present without compromising the ability of future generations to meet their own needs”. Sustainable Development is also explained by the Triple Bottom Line concept, created by John Elkington in the book Cannibal with Forks: “In its broadest sense, the triple bottom line captures the spectrum of values that organizations must embrace - economic, environmental and social. In practical terms, triple bottom line accounting means expanding the traditional company reporting framework to take into account not just financial outcomes but also environmental and social performance – economic prosperity, social equity and environmental protection”. 

The Dow Jones Sustainability Index (2005) website defines corporate sustainability as follows: “Corporate sustainability is a business approach that creates long-term shareholder value by embracing opportunities and managing risks deriving from economic, environmental and social developments. Corporate sustainability leaders achieve long-term shareholder value by gearing their strategies and management to harness the market’s potential for sustainability products and services while at the same time successfully reducing and avoiding sustainability costs and risks.”
Recently the hospitality industry has taken many steps towards sustainable development and it has coined the term of Sustainable Hospitality to summarize the significant and encompassing role hotels and the hotel industry will take in what has commonly become known in the corporate realm as Sustainable Development. (Herve Houdre, et al. 2008). Hotel companies are increasingly encouraging environmentally friendly practices and embracing sustainability through both developmental and operational strategies. With initiatives such as education programs, reforestation programs, eco-resorts, the implementation of energy- efficient practices, and the development of buildings that comply with government-defined standards, the “greening” of the industry is a trend that is here to stay. Over the last decade, the movement towards ecologically friendly tourism has expanded across the world; and the practices being implemented are as diverse as the different geographies. Hotel companies are being prompted by rising energy costs, government pressure, consumer expectations and the competitive landscape to increasingly make sustainability a top priority. 

According to the 2010 Ernst& Young Industry report, “Oceania, therefore Australia, keep leading as a world leader in sustainability, particularly in ecotourism. There is in increase in new conservation policies from both government and operators, particularly to address diminishing water supplies as a result of climate change and to protect native habitats, shifting from traditional ecotourism to even broader sustainable initiatives”. 

In Australia ecotourism remains strong and marketing and green initiatives appear at every level of the industry. At a national level, for instance, The Sustainable Tourism Cooperative Research Centre released its first comprehensive measure of carbon emissions for the tourism industry, The Carbon Footprint of Australian Tourism report. This report identified that transportation is by far the greatest contributor to tourism’s carbon footprint and accounts for 82.2% of tourism’s GHG emissions. (Sloan , Chen & Legrand, et al. 2009). At a private level, “the industry has developed a greater emphasis on social responsibility that is influencing business to initiate environmentally friendly designs in hotels and conference venues and to implement water, waste and energy minimization initiatives.” (Ernst & Young Industry report, 2010)

Another important belief that has become a strong focus for the Australian Market and It is a vital component of sustainable development is the Fair Trade concept. Fair Trade was originally a partnership between non-profit companies and retailers in the northern hemisphere and producers in the under-developed countries who were fighting against low market prices and their dependence on intermediaries who were taking advantage of them. It became rapidly a business model and many Alternative Trade Organizations (ATO), were created to develop the concept. Trading standards stipulate that traders have to:

· Pay a price to producers that cover the costs of sustainable production and living.
· Pay a premium that producers can invest in development, partially pay in
advance, when producers ask for it.
· Sign contracts that allow for long-term planning and sustainable production
practices.
These are probably the main Sustainable Development trends in the Hospitality Industry in the Australian context as we observe today. Following I will examine some of the CSR strategies developed by main industry operators at a national and international level.


The market benchmark

AAPC Limited is the Australian subsidiary of French Company Accor SA. Accor is the fourth world largest Hotel and tourism group, with more than 4,100 hotels and resorts in 90 countries with a total of 500,000 rooms and 145,000 employees. In Australia, AAPC Limited has over 150 hotels and resorts covering all prime business and holiday destinations, with many new hotels to be opened over the next few years. The company offers a comprehensive choice of hotel styles and locations in Australia. Its hotels brands include the upmarket Sofitel, the business-class Novotel, The variety driven All Seasons, and the value-driven Marcure and Ibis Hotels.

In relation to their sustainability strategy, as a part of a global group, Accor Australia follows its corporate international standards developing some specific local initiatives, such as education programs for its employees or supporting some charity organisations depending on the brand and their own context. On the global Context, according to Gilles Pellison CEO of Accor Group, this organisation is involved in two key areas of corporate responsibility: Society and the Environment. Accor’s brands and businesses are increasingly integrating sustainable development concerns into their products and services, in fact Accor appear to be one of the most advanced hotel companies in Sustainable Development (SD). Their Environment strategy started in 1994 building a network of 53 environment correspondents throughout the world. Sustainable Development was officially embedded in the strategy of the company in 2002 with the appointment of a Director of Sustainable Development, member of the Management Board, the creation of a group-wide SD committee and the development of an comprehensive SD strategy. That strategy includes all aspects of the concept. A scorecard has been developed that checks Accor’s involvement throughout the world with all stakeholders: Shareholders, Customers, Employees, Suppliers, Environment and local communities. Accor’s Mercure hotels have partnered with the Carbon Reduction Institute for the first national carbon neutral offering from a major hotel chain in Australia. Emissions produced from conferences, specifically, heating, cooling, lighting, projectors, AV systems and food and beverage (cooking and refrigeration) are calculated and the Mercure Hotel then pays for these emissions to be offset. Currently the offsets being used are sourced from a waste facility that diverts the organic part of domestic waste from landfill and into compost. The decomposition of organic waste in landfill produces methane, which is 21 times more potent than CO2. (Ernst & Young Industry Report, 2009). The IBIS network has embarked on an ISO 14001 environmental accreditation process in 2004 and Novotel announced it was pursuing Green Globe environmental certification in 2007. (Sustainable Development, Accor 2009)

Accor embrace the idea that “one employee can make a difference” and one of the main aspect of their strategy is education. Consequently they have published a short document highlighting conservation tips, a comic book about environment conservation, and an environment guide for hotel managers to train their employees about all aspects of environmental protection. The company’s development criteria include biodiversity and architectural integration, and its corporate philanthropy focuses are on child sponsorship and aid to local communities.  One of Accor’s major initiatives is “Plant for the Planet: Billion Tree Campaign,” through which the company has pledged to donate 50 percent of the savings on laundry costs resulting when guests keep their bath towels for more than one night. Already tested in 52 Accor properties, the program is being rolled out in all of Accor’s 4,000 hotels. Customers are personally encouraged to take part in the program through a message posted in their bathrooms informing them that “Here, your towels plant trees”.

The research also indicated the company was one of the first ones to sign the Global Compact initiative in 2003 launched by the UN, which is a commitment to follow strict guidelines in terms of Human rights, labour, environment and anti-corruption initiatives. 2003. In an effort to show their commitment to the Global Compact, Accor provides a “management chart” that lists their shareholders, objectives and how these comply with the ten articles of the United Nations Global Compact. In 2009, Accor updated its ethical policy, and published The Accor Management Ethics Guide. The guide is organised into three interconnected sections: Management principles, respect for laws and the integrity policy, and social and environmental responsibility. Accor also has established a committee to follow the United Nations Global Reporting Initiative, which provides a framework of 90 sustainable development indicators for hotel companies to use as a guideline for CSR reporting practices.
Although the Accor hotel group does not provide a separate CSR report (information is included in their annual report), they provided a great amount of information on their web site regarding their CSR activities. The CSR section of their web site is labelled “Sustainable Development” so I can conclude that for this organisation Sustainable Development is a more holistic concept. The section contains the six major subsections of shareholders, local communities, suppliers, environment, customers, and employees. 

Mantra Group was created out of a restructuring of Stella Group, which was a subsidiary of global Voyager Holdings, and owned by private equity firm CVC Asia pacific. Stella Group has two divisions: Stella Hospitality Group was renamed Mantra Group in mid 2009.   The company had 3,100 employees for the year and operated 140 hotels and resorts across Australia and New Zealand. Mantra Group recognise its responsibility to minimise their environmental impact by “a continual development of its environmental platform. Its sustainability committee, CSR leaders and Team Members are encouraged to work locally to implement measures aimed at improving its management of energy, waste, water and biodiversity”. According to their website a number of Mantra properties have achieved AAA Green Star accreditation exploring ways to become a more sustainable accommodation provider. However no evidence of these achievements was established.

In order to get more information I contacted Miss Shani Lomas, corporate social responsibility officer at Mantra Group, who explained to me that this organization operates in a ‘strata environment’ so they can own the management of each property, letting rights rather than the buildings themselves. This is the reason why they don’t control a lot of their outputs and the body corporate; the developer or the independent unit owners hold this responsibility. Mrs. Lomas said that it is very difficult for the company to have a “blanket approach” given the diversity of their portfolio. However many of their properties have green measures and initiatives in place, but they are restricted with making any grand statements because of the inconsistency across the business. However, Mantra has opted for a localised approach, guiding their properties with information on best practice and leaving their CSR Champions and committee members to work on the ground at their own pace.
Perhaps the most interesting initiatives of the Mantra group are the ones that have been thought through anticipating for future reporting requirements such as, external auditing and benchmarking of the group’s environmental practices including the purchasing of carbon credits to offset carbon emissions; development and implementation of an environmental Management System and Green conferencing, dinning and accommodation options.

In my website research Mantra appears to be one of the weakest and less developed in terms of CSR and Sustainable Development reports and strategies, I couldn’t manage to find a PDF file or a proper document that could explain in detail their plans, reports or strategies. There is a lack of information and no evidence of education programs for their employees. There is no a clear definition of sustainability or sustainable development concept although environmental sustainability is recognised as a key business priority. 

InterContinental Hotels Group plc Is a UK-based hotel group that was formed in April 2003 with the demerger of six Continents plc into a separate hotel company and a separate restaurant and pub company. Six continents Hotels was renamed InterContinental Hotels Group (IHG). In Australia IHG Hotels Management (Australia) Pty Limited had 170 employees in 2009.   IHG appear to experience a major shift toward a complete Sustainable Development strategy in the last 3 years. The basis is there to make it the industry reference in the coming years. According to Houdre, et al. 2008, the group is aiming to not just be the largest hotel company in the world but as well, become the most admired one.
Many actions toward social responsibility and environmental protections have been certified throughout the years by various divisions or hotels and coordination is now taking place. IHG created the position of Senior Vice President Global Corporate Social Responsibility position was in September 2006. In 2008, IHG’s Hotel Management Group, Americas Division, received the Cause Marketing Forum’s Gold Halo Award for Best Environmental or Wildlife Campaign for its 2007 “Chase the Extraordinary” program. This program reached more than 12 countries including Australia and incorporated employee rallies to launch new company initiatives for 2007 and beyond. The cornerstone of the program was an initiative to replace more than 250,000 incandescent light bulbs with compact fluorescent lights in guest rooms at company-managed hotels. This environmental initiative will have the impact of removing carbon dioxide emissions equivalent to that of more than 17,000 cars. The CFL lamps also are expected to save over $5 million in energy costs. A particularly innovative part of the program distributed an additional 15,000 CFLs to employees of company-managed properties for use in their homes.

Intercontinental Hotels also had a section on their web site dedicated to CSR actions. The content of these pages focused on innovation, collaboration, environment and Community. Each of these categories has at least one page of reporting dedicated to it.
In an effort to show their commitment to CSR, Intercontinental Hotels have also provide a dedicated page that outlines their efforts. One such statement that seems to capture the essence of their stance on socially responsible behavior is:

Through volunteer and education programs, diversity initiatives, environmental protection and in scores of other ways, we help the world become a better place, one community at a time. Wherever we are, we’re people taking care of people.

In addition, the information reported on their web pages, Intercontinental Hotels provided a link to a CSR report called “Corporate responsibility report”. This report is a comprehensive, 78 pages summary of their CSR activities. As an indication of their social responsible behavior, Andrew Cosslett, Chief Executive states:
We are building a culture at IHG that’s focused on driving returns for our owners and on doing the right thing. This means concentrating on areas that fulfill our business objectives and also create social benefit for the communities we work in”
“We are focused on developing better ways to design, build and run our hotels. Our approach isn't about offsetting carbon: it is about green hotel innovation that lessens our negative impacts, whilst enhancing the guests' hotel experience. This is why we introduced our online tool Green Engage in 2009 to help hotels operate in a more responsible and cost effective way. We have also introduced a CR Committee at board level to drive Green Engage and other CR initiatives from the top of the organisation.” (Intercontinental Hotel Group, 2010).
For this company Sustainable development is clearly a very holistic concept that includes not just on the environment but also on the social and economic context. In this sense the company seems to embrace more the triple bottom line concept of sustainable development than the Brutland report definition. Specific interests of this group have been noticed in areas such as; children, education, employee involvement, hotel support and supporting humanitarian efforts.

Thakral Holdings Limited owns 8 hotels on the east coast of Australia as well as commercial and residential properties. 70% of its revenue is from Hotels, which are mainly managed by AAPC Limited. In 2010 these hotels had over 2,500 rooms and included The Menzies, Sydney; Hilton on the Park in Melbourne; Sofitel, Brisbane Central; Sofitel, Goldcoast; Novotel on Collins in Melbourne; Novotel Brighton beach, Suydney, Novotel Northbeach, Sydney; and Novotel Pacific Bay resort, Sydney. 

The Group’s properties and operations are conducted under a wide variety of Occupational Health & Safety (OH&S) and Environmental Protection Acts and Regulations. According to this report “the group maintains an OH&S and Environmental Policy Charter and uses its best efforts to ensure its properties and operations comply with all applicable laws. The Group’s properties and operations hold all relevant OH&S and Environmental licences and permits and have implemented monitoring procedures to ensure that they comply with licence and permit conditions.”

Throughout Australia, the Group’s properties and operations have implemented OH&S and Environmental Risk Management Systems designed to minimise OH&S risks and Environmental pollution and impairment. This program aims to ensure that employees within the Group are fully capable of meeting their OH&S and Environmental responsibilities. All properties and operations undergo a regular OH&S and Environmental survey and audit. These are conducted internally by senior management and/or annually by the Group’s independent risk consultants. Property development projects are carried out in accordance with relevant State Government legislation including development approval and the associated environmental planning requirements. It is the Group’s policy that major breaches of OH&S and Environmental Protection Acts and Regulations are immediately reported to senior management and directors.
This company does not have much information on their website and apparently they have a similar approach to sustainability than the Mantra group which is a more localised style, guiding their properties with information on best practice and leaving their staff and committee members to work on the ground at their own pace. Their environmental strategy is contained in their OH&S and environment report; this clearly means that they see sustainability as a legal obligation to comply rather than as an integral part of the core business.

Hilton Hotels Corporation is developing a strategy for introducing three of its brands into Australia. Implementation of the Hilton Garden Inn, Hampton by Hilton and doubletree by Hilton Brands will lead expansion of the group into Australia, which is considered on of the Hilton’s priority markets. There are several other buildings under construction or in development across the country. In 2006, Hilton rejoined with London based Hilton International. In April 2009, a new Hilton Hotel was opened at Southbank, Melbourne, in close proximity to a major new convention centre, which opened mid year.
Hilton Hotels Corporation announced in June 2008 its short and long term goals and objectives towards building sustainability into the core fabric of its businesses worldwide. Christopher J. Nassetta, President & CEO, outlined targets for improvement in the company’s sustainability performance systemwide for the next five years. By 2014, goals for the Hilton Family of Hotels are are follows:

· Reduce energy consumption from direct operations by 20 percent;
· Reduce CO2 emissions by 20 percent;
· Reduce output of waste by 20 percent; and
· Reduce water consumption by 10 percent.
Their Environment policies are based on a tagline: Reduce - Reuse – Recycle. The company was the first in the industry to be awarded the EnergyStar award in US, for its involvement in reducing electrical energy consumption –fluorescent bulbs in all areas-, water conservation – towel program-, recycling. It encourages its employees to be involved in various community services. Hilton International (now bought by Hilton Corp) has started a program called We Care, which is addressing mostly environmental issues and community service. They have included it in their balance scorecard system. Hilton Hotels has developed an interesting program to help improve relationship between people: Be Hospitable.
According to our research Hilton Corporation is relatively new to the sustainability concept and has not yet embraced a holistic approach to Sustainable development. They communicate mostly on Corporate Social responsibility (CSR) and environment concerns. According to Hilton Worldwide, “sustainability means continuous improvement and action. Our objective is to lead our industry with products and programs that not only deliver great guest experiences, but protect the world we live in.” In this case we could state that Hilton approach to sustainability is in line with the Burtland report definition of sustainable development and it is just related with environmental issues.

Conclusions

This research shows that in general the hospitality industry have become increasingly active in implementing sustainability practices. Some hotel companies such as Accor and IHG are more progressive in their definition of sustainable development including social, economic and environmental aspects in their core business. Therefore their definition of ‘sustainable development’ is more in line with the triple bottom line concept created by Elkington. On the other hand some organizations such as Mantra or Thakaral take this concept as a moral responsibility or just to comply with some legal obligations, their approach is more aligned with the Burtland report and it is focus mostly on environmental issues. Hilton is a different case and their approach is more likely to be related with the Dow Jones Sustainability index definition of sustainable development, as a part of the core business to create economic value and provide a better experience for their guests. In any case most of the companies share the view that sustainable development and sustainability represents an opportunity for the industry to become more efficient in the use of their resources.

According to the Ernst& Young industry report “the emergence of mandatory greenhouse gas and energy reporting across Australia and New Zealand and the development of emissions trading schemes is likely to continue to raise the profile of sustainability and climate change issues for the hospitality industry in the Oceania region. Government regulation is likely to impact the supply of new developments through minimum energy efficiency standards while greater disclosure will influence existing developments and operating practices”. In this context sustainability programs can provide a competitive advantage. However, everything indicates that over time, green practices will become a compulsory requirement to doing business in the hospitality industry, particularly as the cost of nonrenewable energy continues to increase. Thus, those companies with business models that rotate around green practices will have the strongest opportunity of achieving a “sustainable” competitive advantage.

References

• · IBIS world Report H5711. Hotels and Resorts in Australia. Accessed by RMIT catalogue website.
• · Philip Sloan, Joseph S. Chen, Willy Legrand (2009). Sustainability in the Hospitality Industry: principles of Sustainable operations.
• · Global Hospitality Insights. Hospitality Going Green. Ernst & Young report, 2010.
• · Sustainability Toolkit – Hospitality. NSW Business Chamber (2009). Australian Government. Department of Environment, Water, heritage and the Arts.
• · David Kirk (1995) Environmental Management in Hotels, International Journal of Contemporary Hospitality Management, Vol. 7 Iss: 6, pp.3 – 8
• · Sustainable Tourism CRC - www.crctourism.com.au
• www.crctourism.com.au/WMS/Upload/Resources/bookshop/10072%20Carbon_Footprint_SUM.pdf
• · Accor Group, Sustainable Development - http://www.accor.com/en/sustainable-development.html
• · Mantra group, Corporate Social responsibility http://www.mantragroup.com.au/AboutUs/CorporateSocialResponsibility.aspx
• · Intercontinental Hotels Group http://www.ihgplc.com/index.asp?pageid=740
• · Green Movement grows in Global Hospitality Industry: report http://www.greenbiz.com/news/2008/12/17/green-movement-grows-global-hospitality-industry-report
• · Dow Jones Sustainability Index (2005), available at:
• www.sustainability-indexes.com/html/ indexes/overview.html
• · "Water efficiency". "In your business" >>"How to save water" >> choose the Hotels, clubs, restaurants and pubs link to find fact sheets and other resources. www.sydneywater.com.au
• · "What a waste" by David Baker - www.foodwise.com.au
• · Herve Houdre, (2006), Sustainable Hospitality: Sustainable development in the Hotel Industry. http://willarddc.com/sd/docs/willardwhitepaperproof.pdf