{"id":9106,"date":"2016-11-03T19:57:41","date_gmt":"2016-11-03T23:57:41","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/marriotts-take-on-climate-change\/"},"modified":"2016-11-03T20:02:53","modified_gmt":"2016-11-04T00:02:53","slug":"marriotts-take-on-climate-change","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/marriotts-take-on-climate-change\/","title":{"rendered":"Marriott\u2019s Take on Climate Change"},"content":{"rendered":"

Marriott International is a hotel company with more than 5,700 properties, including the recent acquisition of Starwood Hotels, across the 110 countries.1<\/sup> With more than 195K rooms in the current development pipeline, Marriott is continuously looking for opportunities to grow and expand its global footprint. Marriott is no exception to the challenges it faces with the issues of climate change. The risks associated with climate change will impact Marriott through: 1) changes in regulation, 2) changes in physical climate parameters, and 3) changes in consumer behavior influenced by reducing carbon footprint.2<\/sup><\/p>\n

Changes in regulation are mainly due to governments creating fuel\/energy and carbon taxes to encourage companies to reduce energy consumption and greenhouse gas emissions. Such taxes increase a hotel\u2019s operational costs and therefore, Marriott\u2019s value proposition of offering an efficient low-cost hotel operating model is compromised.<\/p>\n

Changes in physical climate parameters involve both the fluctuation and frequency of extreme weather. The demand from both leisure and business travelers is largely impacted by extreme weather such as tropical hurricanes, snow storms, heat waves, droughts, and floods. Such extreme weather can cause severe damage to Marriott\u2019s hotel properties resulting in displaced guests, increased costs, and decreased revenues. With average global temperatures increasing, Marriott\u2019s hotels face rising operational costs as frequent heat waves increase energy consumption for cooling buildings. In addition, Marriott can be financially and operationally impacted with an increase frequency of tropical storms. For regions experiencing longer periods of drought, Marriott would need to curtail consumption of water, which impacts landscaping, guest services (ex: daily bedding\/towels), and overall hotel operations.<\/p>\n

Changes in consumer behavior is a risk associated with the growing concerns of climate change and consumers interest in reducing their own carbon footprint. Consumers are holding themselves accountable and expect the same of the companies they patron. Consumers are likely to prioritize and reward companies that adapt their business operations to be more environmentally sustainable. Marriott is viewed as a leader in the hotel space. Consumers will expect Marriott to \u201cgreen\u201d their hotels to make it a sustainable choice for consumers. If Marriott fails to address the environmental concerns of climate change, then the company will become less relevant to travelers.<\/p>\n

Understanding the risks of climate change, Marriott created the Global Green Council in 2007.2<\/sup> The council is made up of ten global offices representing various departments such as Lodging Development, Marketing, Global Design and Sustainability. The focus of the council is to continue enhancing the company\u2019s sustainability efforts by evaluating their current practices and utilizing their environmental strategy as guidance to set long-term goals. Since creating the council, the company has set several initiatives2<\/sup>:<\/p>\n