Once a competitive edge, sustainability is now imperative in the European hotel sector. A strong sustainability strategy enables investors to identify opportunities and manage risks related to environmental, social, and governance (ESG) factors — as well as drive performance to create long-term value.

The shift from sustainability being an advantage to a business necessity is driven by three main factors.

Firstly, awareness of climate change and its human impacts is now ubiquitous, and many people have experienced those impacts first hand. As a result, travellers are more likely to be eco-conscious, making hotel selections with sustainability considerations in mind, and employees are more likely to want to work at hotels that prioritise their health and well-being. Secondly, rising inflation put significant added pressure on operators to reduce costs and increase efficiency. And thirdly, increasingly stringent environmental regulations, often on capital lenders, mean