Nutritics recently hosted a business leaders' dinner at Hawksmoor’s incredible Wood Wharf restaurant. Joined by guests from across the hospitality sector, a number of topics were discussed around the table, including what sustainability means to different businesses, the importance of engaging staff with the process and deciphering the upcoming reporting regulations.
Here are five takeaways from the session. Held under ‘Chatham House Rules’, all quotes have been anonymised.
1. Doing the right thing varies from business to business.
“We’ve always wanted to do things the right way — that was the whole vibe.”
“We don’t necessarily want to label (our sustainability progress), we just want to do the right thing.”
“We are looking to do the right thing — the problem with that phrase is that it’s all encompassing, but it gives a spirit about what we want to do…”
“Everyone believes they should do the right thing; no one wants to go out of business doing it.”
Taking positive steps to reduce their environmental impact was clearly on the minds of the panel. But as the last quote states, there is a line to be tread between doing what is right for the environment, and also running a profitable company. What shone through is that the ‘right’ actions can massively vary between businesses.
Knowing where to start when it comes to sustainability can be daunting for businesses. It’s therefore important to initially focus on the key areas that matter to you, your staff or your customers. There are of course accreditations such as B-Corp status that can be explored, but this might not be suitable for everyone.
As one attendee stated: “If you can’t explain in 15 seconds to a consumer why your business is good, then who is still listening?”
Keep your sustainability purpose simple so that you can focus on ‘doing the right thing’, whatever that might look like to you.
2. There is a clear economic case for focusing on sustainability.
One theme that came from the session was the potential divide between purpose and profit.
“It should never be profit or purpose,” stated one attendee. “Within hospitality, if you get things right and hit the sweet spot it ought to supercharge both.”
One guest discussed how actioning sustainability because of moral arguments will only get the hospitality industry so far and now is the time to combine green ideas with the idea of growing a business and making money.
“We previously thought that there’s a bottom-line cost to trying to do things decently (sustainably). Now we feel the opposite, that there is a commercial benefit to it — and we’re demonstrating that our way of doing business matters and should be more prevailing.”
So, there is a growing sense that purpose and profit no longer have to be in separate silos, but that committing to a sustainable way of working, encompassing environmental and social factors, can be fundamental to growth, especially with a rising consumer demand for purpose-driven businesses.
Making sustainable changes needn’t be at great cost though. One business spoke of a lot of “low hanging fruit” improvements that didn’t cost anything to implement and in fact freed up costs to spend elsewhere.
It’s worth noting that recent hikes in energy prices have slowed down sustainability schemes in recent months for some, with the argument that it’s no good ticking every sustainable box if it means your business fails.
“You don’t want to be the cleanest battleship at the bottom of the harbour — we’re still a business and we need the profit to come through.”
This highlights the need for more support from governments to incentivise businesses to reduce their environmental impact whilst remaining buoyant.
3. Sustainability is crucial to staff as well as consumers.
The dinner saw an interesting debate around the importance of sustainability for consumers. Research from Foodprint by Nutritics last year found that 17m Brits were more likely to choose environmentally friendly bars and restaurants. But around the table, it became clear this differed from sector to sector.
For bars and pubs, the message was that as their role is to provide people with escapism, and that highlighting the threats of the climate crisis is not top of mind for customers using their services. So, while it’s essential for bars to be working on their sustainability credentials and educate staff on the improvements made so that they can inform consumers when asked, it’s not necessarily something that is always openly communicated to customers in situ.
A common thread of those in the room was that staff want to work for companies that are actively trying to make a difference, and not just declaring wishy-washy sustainability statements without anything substance.
“Purpose is important (for staff), but it has to be an organic thing that is part of the culture and DNA of the company…”
4. Measuring and setting targets can help focus your sustainability journey.
Measuring your environmental footprint and its change over time remains one of the hardest elements for hospitality and foodservice businesses.
One attendee claimed that one of the biggest challenges is knowing where to start when it comes to sustainability.
“We’re trying to do the right thing when it comes to sustainability. The problem with that is that it’s so enormous and we were trying to work out who we work with and who helps us on our journey.”
Another speaker said that engaging third party support to develop an ESG strategy was a turning point.
“We felt we were doing an awful lot of different work around sustainability, but we felt we had to combine all of this and present it as a strategy going forward and most importantly, setting targets and putting KPIs against it.”
By understanding their current progress, they were able to see clearly what the sustainability priorities were for their staff and customers, and shine a light on these.
"Having clear environmental KPIs and targets has been really important because it's given us a structure that points us all in the right direction. It helps us understand our priorities, and provides clarity about what we're working towards."
The roundtable highlighted that obtaining accurate data around various eco elements of a business and what to measure was tricky, with one attendee stating: “It’s a bit like the Wild West at present around what metrics do you use and what are you working towards…”
An example of this in the hospitality and foodservice (HaFS) sector is the demand for automated eco-labelling on menus, supply chain data insights and scope 3 emission reporting. Nutritics, an established menu management system, has developed one such solution called Foodprint, a pioneering, fully automated environmental impact scoring system.
5. Regulations are complex, so collaboration in the industry is key.
It will be no surprise that the conversation concluded by looking at what regulations were on the horizon for hospitality businesses to be aware of.
For more details on ESG reporting, you can read our recent in-depth article here {link to ESG article – due to be published March 2023}.
The message from the table when it comes to reporting? Don’t panic. If you’re already taking actionable steps to reduce the environmental footprint of your business, then you’re on the right track. Measuring your progress along the way, such as working with an environmental impact scoring system like Foodprint, will put you in a good position for the future.
Although the UK is yet to introduce mandatory ESG reporting requirements, developments in climate reporting have been observed over the past year and environmental legislation is expected to be introduced in the coming years. The reality is that across the world no one is quite in agreement about the best way to measure sustainable progress and it’s likely there will be variations across territories.
It is expected that disclosing greenhouse gases output will be a significant part of measurements globally, whilst the impact of the overall supply chain will be hugely important in terms of labour and raw materials, as well as human capital. On a broader scale, diversity and inclusion will continue to form a major part of ESG initiatives.
What was clear — especially when measuring scope 3 emissions (emissions that are not produced by a company itself but from up and down the value chain) — is that collaboration in the hospitality industry is vital and that sustainability can’t be accomplished alone. Sharing information around best practice and having open conversations with suppliers, partners and other stakeholders will be the best way to make a more impactful difference.
With that in mind, the session closed with a simple but wise statement: “Perfect is the enemy of great.” Improving the sustainability of a business is a complex, multi-faceted task. The message was that the fear of not having the perfect solution shouldn’t stand in the way of making sustainable changes now.
Thanks to all attendees of the Nutritics Business Leaders’ Dinner for your valuable insights and input.