Branded Sustainability Measurement System Save Hilton $74 Million


October 21, 2011—Global hospitality company Hilton Worldwide says it saved more than $74 million in 2010 across its portfolio of 10 hotel brands as a result of its sustainability measurement program, called LightStay.

Hilton Worldwide claims to be the first major multi-brand hospitality company to make sustainability measurement a brand standard, and the company reported the following results:

  • 6.6 percent reduction of energy use
  • 19 percent reduction of waste output
  • 3.8 percent reduction of water use
  • 7.8 percent reduction of carbon output

LightStay measures multiple utility and operational metrics such as energy, water, carbon, housekeeping, paper product usage, waste, chemical storage, air quality and transportation. In addition, LightStay features a “meeting impact calculator” element that calculates the sustainability impact of any meeting or conference held at a property.

Hilton recently added new features to LightStay that allow hotels to track projects, share best practices and communicate with one another through a social network dashboard. Thus far, LightStay has more than 1,200 projects in the system, which is expected to double by next year, as all of Hilton’s more than 3,750 properties are required to begin using LightStay by this December.

“LightStay has provided us with a platform to measure hotel performance and economic improvement, proving to be invaluable given today’s increased operational demands and resource constraints,” says Christopher J. Nassetta, president and CEO of Hilton Worldwide.

By 2014, Hilton Worldwide is committed to reduce energy consumption, CO2 emissions and waste output by 20 percent, as well as reduce water consumption by 10 percent from direct operations within the company’s owned hotels and corporate properties.

Over the next three years, Hilton says it will continue to invest in their owned assets to improve building performance. Projects will include the installation of energy-efficient chillers, boilers, motors, building automation systems, water reclamation systems, high-efficient windows and white roofs. The Hilton New York, for example, will be installing an onsite cogeneration system, which will offset 54 percent of its electrical needs and 33 percent of its thermal needs.

Hilton recently earned ISO 14001 certification for Environmental Management Systems, achieving one of the largest ever volume certifications of commercial buildings.

Bart King is a PR consultant and principal at CleanTech Communications, and an active contributor to Sustainable Life Media.

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Companies Are Using Sustainability to Pursue Broader Goals

November 1, 2011—More companies are using sustainability to improve processes, pursue growth, and add value to their companies than focusing solely on reputation according to a study recently released by McKinsey & Company. Based on a July 2011 online survey of over 3200 executives from a wide range of regions, industries, company sizes and functional specialties, the study found that, compared to a similar study last year, larger shares of executives say sustainability programs make a positive contribution to their companies’ short- and long-term value. And more executives say their company’s top reasons for addressing sustainability include improving operational efficiency and lowering costs. The share that said this jumped 14 percentage points since last year, to 33 percent, edging out corporate reputation, selected by 32 percent of respondents.

Sustainability Can Play a Role in Any Value Creation Strategy:

The study identifies three different levers that companies can use to create value–growth, return on capital, and risk management—and finds that sustainability has a role to play in all three. According to McKinsey’s framework, a growth strategy may involve innovation and new products or reaching new customers and markets; a strategy of improving returns on capital might feature increasing the environmental performance of operations; a risk management strategy could entail regulatory or reputational management. The study found that some value strategies are more common than others.

Sustainable Growth Strategies Relatively Rare among Rank and File Companies

Companies are utilizing sustainability tactics in all three value creation strategies, according to the survey, but growth strategies powered by sustainability are relatively rare. About twice as many executives say their companies are reducing energy usage than say they are reaching new customers or markets as a consequence of their sustainability activities, for instance.  Just 18 percent of companies said they were able to achieve higher prices or greater market share from sustainable products.

Leaders More Likely to Employ Growth Strategies

Leaders are more likely to employ sustainability growth strategies than the rank and file, according to the study. Individuals were classified as leaders if they said that sustainability was a high priority and was managed well at their company, along with some other criteria. According to this segmentation, sustainability leaders were more than twice as likely as non-leaders to be pursuing a sustainable growth strategy. Indeed, they were more likely to be engaged in any of the three value creation strategies than non-leaders. One implication seems to be that as companies elevate the priority of sustainability in their organizations and improve their ability to manage sustainability initiatives, a broader range of options for creating value opens up to them.

Written by David Schatsky, President of Green Research, for Sustainable Life Media.

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