Understandably both the tourism sector and hotel industry are focused upon the short-term recovery from the pandemic. But there are important lessons to learn in relation to climate risk.
COVID-19 has highlighted the reality of ‘grey rhino’ events - a highly probable, high impact, yet neglected event. These systemic risks must be incorporated into the strategic risk planning of leisure and tourism companies. At the same time, the mandating of the Task Force on Climate-related Financial Disclosures framework (the TCFD) in the UK and several other jurisdictions provides the framework for companies to take action and ensure their long-term resilience to climate change - by adapting to both the risks and opportunities.
The impacts of climate change on a hotel business can be nuanced but there are three major areas of risk for leaders in the hotel business to consider:
- The low carbon transition: The need for a material reduction in transport emissions necessitating changed business and leisure travel patterns
- The conscious consumer: The changing demands of consumers as they become increasingly conscious of the impact of their buying patterns
- The increase in physical events: the impact of increased physical weather events causing damage to infrastructure or business interruption issues.