Nikki Mattei shares advice for property management companies on the best way to start an ESG strategy

Nikki Mattei is a communications and responsible tourism expert, who writes these regular Insights for property management professionals. She is also host of a Sustonica-badged property in Italy for which she has developed an ESG strategy. In this article, Nikki shares her advice to help any property management company wanting to develop a sustainability strategy. Usually getting started is the hardest part. Here at Sustonica, we want to empower you to begin your journey and be part of transforming our industry.

Why is it important to develop a sustainability strategy?

You are probably aware of the compelling reasons for setting out a sustainability or ESG strategy for your property management business. However, we will outline them briefly again here so that you can consider them during the process. They will also enable you to articulate the relevant benefits to colleagues in different departments.

Firstly, attracting delighted guests and encouraging repeat bookings are obviously top of mind for any vacation rental business. When it comes to sustainability, we know that guests are looking but find it difficult to identify these places. When they are able to find sustainable stays, bookings increase. However, the latest Booking.com Sustainable Travel Report has also revealed that travellers expect hospitality companies to take responsibility and invest in sustainable initiatives. Importantly, they still want to travel sustainably (75%) and nearly half (43%) would feel guilty if they did not do so. This all points to property management companies actively playing their role. They can be instrumental in making it easy for guests and owners to make responsible choices.

Secondly, regulation has become a key driver in the motivation to understand how to develop a sustainability strategy. There are new laws around greenwashing in various regions with the need to have many claims validated by a third party. In addition, larger companies are already having to report on their Environmental (E), Social (S) and Governance (G) policies.

Furthermore, in connection to ESG reporting obligations, investors and banks now use sustainability as part of their risk assessments. Any business which cannot clearly demonstrate that ESG is a key part of its business plan will not be viewed favourably.

Lastly, there is plenty of research to show that employees want to work for businesses that take their responsibilities for people and planet seriously. They want to work for a company which has purpose with a clear sustainability strategy.

In summary, it is clear to see that having well thought-out sustainability practices are essential for building guest trust and loyalty. But, more than that, it is an integral part of running a viable and resilient business. One which attracts and retains the best people, invests in strong supply chain partnerships and stays ahead of regulation and market forces.

How to develop a sustainability strategy – the key points

In fact, it is relatively easy to come up with some key actions for your sustainability strategy, as the delegates at SCALE Green discovered. However, they should be chosen for the right reasons and be part of an overall measurable plan. Furthermore, sustainability should not be seen as an add-on to your business. Rather an integral part of your future plans. Undoubtedly, you will have a detailed business plan for the coming years. As such, sustainability should be woven into those goals as it has an impact on every aspect of running a business. From transparent and engaging communications to robust supply chains and sustained revenue.

These are some of the key elements you should include in your sustainability strategy. They will ensure that you set measurable goals and accountable targets. It will enable you to engage with and involve all your stakeholders and report transparently on your progress. Importantly, you will also inspire other property management companies and be part of leading the vacation rental industry to a brighter future.

In the following sections, Nikki has suggested an approach for a property management company to use when considering how to develop a sustainability strategy.

1. Change your mission to your purpose

As with any business plan, you would start with your ‘why’ in order to define your mission statement. With a sustainability strategy, I recommend that you call this your ‘purpose’.

Think about what has motivated you to develop a comprehensive ESG strategy rather than just listing a few action points. Subsequently, a good place to begin is to review your current brand values and brainstorm how sustainability could be part of these. Perhaps it is a unique aspect of the destination where your properties are located or the type of owners you work with.

In order for sustainability to become a powerful part of your brand, it needs to feel relevant and meaningful – to all your stakeholders. Your purpose needs to address – and enhance – the key business objectives that you already have in place.

Finally, remember that you are in the business of creating unforgettable and precious memories.

Offering sustainable places to stay can help you do that. On that point, in the latest Booking.com report, 62% of travellers said that they are the best version of themselves when they travel more sustainably. A great outcome to aim for!

2. Choose your starting point for phase one

Sustainability can seem overwhelming – I have heard that many a time. And I get it! I am the sort of person who wants to understand everything but you do not need to be that detailed. In fact, it is much better to keep it simple. Focus on actions that are relevant to your brand purpose and easy to implement.

Consequently, I recommend you choose around 3 actions or new practices that you can take onboard and see results from pretty quickly. I also suggest that, as a property manager, you start with your own team and offices. It is always a good idea to get your own house in order first! You can set this as phase one and then move on to your other stakeholders, namely property owners and guests.

I always describe sustainability as 3 key areas: the environment, the natural world and people. You could decide to focus on just one of these to start or pick one within each. Be guided by what makes sense for your brand and what you can easily achieve.

The Sustonica Criteria make a great place to start as they cover simple actions across 4 key areas.

• Energy conservation
• Destination promotion and support of local communities
• Waste reduction
• Water conservation

Of course, many of these criteria will relate to properties rather than your own offices. Consequently, do choose those which are relevant to your business operations, such as removing single-use plastics, recycling or setting up corporate volunteering. The speakers at the inaugural SCALE Green conference had a lot of good ideas!

3. Engage your management team early on

As already mentioned, it is super important that you involve all your stakeholders in your sustainability strategy. Their buy-in and subsequent implementation will be vital for success.

Consequently, I recommend that you involve your management team at an early stage. Tell them your plans and ask for their input – they will probably have some innovative ideas. Furthermore, you are likely to find passionate individuals who will be keen to become part of your “Green Team” and lead their co-workers.

4. Set your framework, create a roadmap and choose your tools

Now that you have chosen your actions (probably 3), you need to create a more detailed framework. This will set out your goals over a phased period of time – probably one, three and five years. Of course, this is not set in stone but will allow you to create a roadmap of actions you need to take.

Particularly for environmental actions, you will need to gather data like energy bills or office supply invoices. From this you can choose a baseline year which is typical for your business. Of course, the hardest part will be to choose reduction targets. So the first year may be a bit of a trial and then you can set more realistic ones.

Once you have set your targets, you should then decide how you are going to monitor and measure your data. If you work in shared offices, you may need to collaborate with your landlord and others in the building. If you do control your own energy use, you may decide that you can use simple spreadsheets to log your usage. On the other hand, it probably makes sense to measure your carbon footprint as well. As such, you could choose a carbon footprint calculator where you can enter your data from the start.

When it comes to “people” policies, like corporate volunteering, you may still need some tools to help you manage the initiative. Not to mention, organisations who can help you identify bona fide and impactful causes.

Once you have set out your actions for Phase One (your own operations), you can then show the next phases of your Roadmap but including less detail at this stage.

6. Enhance the guest experience