Q&A: Maximising investment returns through ESG

Between 9-11 September 2024, senior representatives from across the hospitality industry will head to Hong Kong for the inaugural International Hospitality Investment Forum (IHIF) Asia 2024.

This year’s speakers include senior representatives from: Gaw Capital, Ares Management, Hilton, Radisson Hotel Group, and many more.

Not only will you hear from leading hotel investment executives, but the multiple networking opportunities mean you’ll be able to capitalise on the return to dealmaking we are seeing this year.

Integrating ESG credentials into a hotel not only enhances consumer appeal but it also has the potential to boost asset profitability, enhance capital returns and help access a lower cost of capital. With that in mind it has become an increasing area of focus across the stakeholder stack, from brands to owners.

To get a sense of what is helping to drive this trend, we recently caught  up with Mehvesh Mumtaz Ahmed, vice president and global head of social impact at Rosewood Hotel Group

Ahmed will be speaking on a panel entitled ‘Sustainable Success: Maximising Investment Returns through ESG in Hospitality' (Wednesday, September 11, 10:25  to 10:40 )

Hospitality Investor: What are Rosewood's primary sustainability goals, and how are they being implemented across your hotels?

At Rosewood, sustainability is at the core of our brand identity and seamlessly integrated into the luxury experience we offer. Through Rosewood Impacts, our social impact and sustainability roadmap, we are committed to enabling equal access to opportunity and embracing circular hospitality. We don’t see this as parallel to our business but as a core part of it. We have set concrete, measurable goals that span across how we hire, who our suppliers are, and how we uplift businesses in local communities. We’re also working towards net zero carbon emissions by 2050, and laddering our way to that with milestones around eliminating single-use plastics, reducing and diverting waste across our portfolio, reducing energy and water use, and more.

Guests can see this across our portfolio. One of many examples is Kona Village, A Rosewood Resort, which exemplifies our commitment to sustainable luxury. The resort operates on 100% solar energy and features a comprehensive approach to preserving natural resources, including the development of reverse osmosis and wastewater treatment plants. And by collaborating with the Cultural Leadership Committee, the entire resort was designed in harmony with the traditional winds of the area, maximizing natural breezeways to reduce the need for air conditioning. This thoughtful design not only honors the local environment but also demonstrates that sustainable operations can enhance, rather than compromise, the guest experience​.

Another prime example is Rosewood São Paulo, which operates completely on renewable energy and has achieved almost 100% waste diversion rate. This property, part of Brazil's largest upcycling project, sources materials locally and celebrates cultural preservation by showcasing 450 artworks by Brazilian artists​​.

Hospitality Investor: How does Rosewood measure and report its ESG performance? Are there specific frameworks or standards you follow?

Mehvesh Mumtaz Ahmed: Rosewood’s commitment to Environmental, Social, and Governance (ESG) performance is measured through leveraging sustainability software to collect data on carbon, energy, water, volunteering, etc. We have also developed a bespoke approach to collecting qualitative data on partnerships with suppliers, producers and artisans. All of this data flows into estimating our overall “Impact Footprint”. Each property, guided by the Rosewood Impacts framework, tracks and updates progress on a monthly basis.

Our efforts are also supported by internal audits at each property, ensuring we are continuously improving and meeting our impact and sustainability goals. Rosewood’s approach aligns with global best practices and is informed by our deep commitment to transparency and accountability​.

Hospitality Investor: How does Rosewood engage with and support the local communities where its hotels are located?

Mehvesh Mumtaz Ahmed: Rosewood wants to create a future where people and place enrich one another. This means our engagement with local communities is about every property not only respecting but actively uplifting its surroundings. Rosewood Mayakoba, for example, supports the local K’iin Beh school, providing education to over 450 children from the local community, many members of of which are employed by the hotel. The hotel’s partnership with K’iin Beh is integrated into the guest experience, allowing them to contribute through donations and volunteer programs​​.

In Hong Kong, Rosewood’s BluHouse is a standout example of a “business with purpose,” where we employ refugees and ethnic minorities through partnerships with local NGOs. The restaurant also pledges 1% of its revenue to support these underserved groups, demonstrating how luxury hospitality can be a force for good​​.

At Rosewood Phuket, our Food & Beverage team prioritizes Rosewood’s “Partners in Provenance” program, which champions partnerships to source the utmost best and freshest ingredients. This has resulted in Ta Khai, another “business with purpose” restaurant, sourcing 100% of its ingredients within the country to serve some of the best Southern Thai cuisine in the region.

Hospitality Investor: Can you highlight any innovative ESG practices or technologies that Rosewood has recently implemented or plans to implement?

Mehvesh Mumtaz Ahmed: Rosewood looks to implement innovative ESG practices that stand at the intersection of environmental stewardship, social impact, and rewarding travel experiences.

As mentioned previously, Rosewood São Paulo maintains a comprehensive waste management program in which solid and organic waste is recycled or repurposed. Not only has the property eliminated the use of plastic bottles in restaurants, but they went one step further and invested in a dedicated biodigester as well as a glass crushing machine. The hotel has also secured a long-term contract with Multilixo, a company responsible for waste logistics and committed to the Zero Waste Training Program, ensuring that all waste is managed in an environmentally responsible manner​.

Kona Village, A Rosewood Resort also stands out not only for its sustainable operations but for the way it involves guests in these efforts. The resort’s expert cultural and sustainability teams have curated programs that allow guests to engage directly with the island’s environment, from tide pool tours to bird-watching excursions. In partnership with the Ke Kai Ola- Monk Seal Rehabilitation Center, Kona Village, A Rosewood Resort offers guests the opportunity to fish for invasive tilapia from the onsite fishpond, which are then used to feed recovering Hawaiian seals. This initiative not only educates guests about endangered species conservation but also gives them a hands-on role in supporting these efforts​.

These efforts at Rosewood São Paulo and Kona Village, A Rosewood Resort are part of a broader sustainability strategy under Rosewood Impacts, which not only focuses on waste management but also includes initiatives to reduce carbon emissions and promote energy efficiency across our global portfolio. By integrating these practices into our operations and quietly working towards even more ambitious goals, we are hoping to show what we know to be true: true luxury is sustainable  that is both sustainable and socially responsible.

Hospitality Investor: The theme of this year's event is "Charting New Horizons". What do you think are the biggest opportunities in hotel investment in the region?

Mehvesh Mumtaz Ahmed: "Charting New Horizons" is about pioneering the future of hospitality. I think that for this future to be bright and have a comsistent, long-term RoI for investors, it has to be built in a sustainable way that preserves places and helps people thrive. The biggest opportunities for hotel investment are in brands that see this and are steering their business to build an inclusive future. That are looking 5, 10, 20 years down the line and taking steps to ensure they are not only ready but actively influence and amplify changing guest and talent preferences. 

At Rosewood, we see immense opportunities in making luxury synonymous with sustainability and social impact. We see investing in energy-efficient infrastructure, fostering local partnerships, and creating purpose-driven businesses as key growth areas that will deepen brand equity while serving the people and places where we operate.