Keywords

Introduction

The services sector has been rapidly growing over the last decades and nowadays represents one of the economic engines of many countries around the world. In particular, tourism industry has contributed significantly to the GDP of numerous countries and has been on the rise (UNWTO, 2022). Unlike other sectors whose impacts and interrelationships are more delimited, tourism is strongly associated with a range of services, from agriculture and finance to construction and retail (Sorin and Einarsson, 2020). Indeed, these interrelations with other industries magnifies the impact of this industry on the economy, both in terms of economic activity and job creation (WTTC, 2019). However, this industry is also known to provoke negative externalities on the environment, leading to its degradation and a rise in Green House Gas (GHG) emissions (Lenzen et al., 2018), among other harmful effects. Particularly, the transportation and the hospitality industry the tourism activities with the most important impact on CO2 emissions (UNTWO, 2008) and global trends in both sectors continue with a steady growth. Indeed, several studies have already reported a high use of resources, such as water or energy, and a high production of waste (Girard and Nocca, 2017; Alonso-Almeida, 2012; Manniche et al., 2017). Then, despite its positive impacts to the economies, it is important to take into account the negative environmental consequences of the industry in order to be able to achieve a balance between economic growth and environmental care.

To ensure the welfare and proper living standards of current and future generations, it is imperative that the travel and tourism sector develops a strategic paradigm shift, where it rethinks its values, purpose, business models, and value chains, what should benefit from its long-term viability and sustainability (UN, 2016). The adoption of this sustainable path can be provided by the Circular Economy (CE). CE allows for a better use of inputs and a better management of the outputs to pursue eliminating, reducing, reusing, recycling or recovering materials in the business operation (Kirchherr et al., 2017). So far, the concept of CE has been mainly addressed in resource-intensive industries, however, the above highlighted interrelations among industries suggest that CE requires a holistic view of the business and the active implication of the stakeholders and surrounding industries (Marino and Pariso’s, 2021).

In this line, the European Union is taking steps to reach the climate neutrality by 2050 based on CE. Initiatives such as the New Circular Economy Action Plan (COM 98, 2020) or the European Green Deal (COM 640, 2019) focus the action on extending the use of resources and on minimizing the amount of waste generated. Considering these two main factors, to move forward to a circular model, organizations require indicators and methods to be able to measure and evaluate their status and progress with respect to CE. There have been several approaches when measuring CE, such as “A New Industrial Strategy for Europe” (COM 102, 2020), Longevity indicator, Resource Potential Indicator, Sustainable Process Index, Input Output Analysis, Material Flow Analysis or Life Cycle Assessment, among others. However, many of these indicators cannot be applied to organizations and require some of their own ones (Vinante et al., 2021). Consequently, there is no consensus when evaluating CE strategies and plans. Thus, organizations’ evolution towards a CE needs instruments that allow them to evaluate and communicate the results of their transition to a CE, what requires indicators, measurement methods and procedures to be standardized.

Even though the hotel industry has been adopting eco-friendly practices since the beginning of the twenty-first century (Alvarez-Gil et al. 2001) and, more recently, the world’s leading hotel companies have already adopted some CE principles and practices, many hotels are still lagging behind in the race towards sustainability. Moreover, there has been little scientific research on why more quantity of hotels are not yet implementing CE (Rodriguez et al., 2020) or how hotels can adopt CE values. Particularly, there is a lack of research in which tools should be applied for CE measuring and evaluation in the hospitality industry, and little amount of good practices and lessons have been learned from CE implementations.

Taking into account this context, the main goal of this chapter is to develop a basic measurement and evaluation framework for measuring and evaluating the circular level of hotels as a tool for monitoring and planning their circular actions. This, eventually, will lead hotels to implement good practices leading to an increase of their circularity level.

The structure of this chapter is as follows. Section “Literature Review” is focused on the theoretical framework. Section “Methodology” presents the methodology of the study. Section “The Self-assessment Tool” along describes the indicators and the evaluation framework. Finally, the conclusions and further lines of development of the self-evaluation tool are examined in section “Conclusions”.

Literature Review

CE is a concept that goes further than reduction, reuse and recycling (Ghisellini et al., 2015), extending the nature of the intervention from the conception of the product or service, through redesigning, to the extension of the life of the resource, through recovering, or the product, through remanufacturing. The hospitality industry actions towards CE have been reported mainly in energy, water and waste recycling. In fact, recent legislation in some pioneer destinations, such as the Balearic Islands (Comunidad Autónoma de las Illes Balears, 2022), focusses in these areas. Since, hotel industry is an operational service industry, most of the CE implementations have been directed to improve the circularity of the hotel operations. Reduction strategies are the most common approaches to introduce sustainable and circular practices in hotels (Manniche et al., 2017). Additionally, eco-innovations (Florido et al., 2019; Alonso-Almeida et al., 2016) are popular actions in this area. The best practices in energy, water and waste reduction are related to the use, for example, of renewable energies or efficient lightening (Vourdaubas, 2016; Girard and Nocca, 2017), the reduction of water consumption with water aerators, environmental responsible laundry services or rain or graywater water storage (Alonso Almeida et al., 2017; Fernandez-Robin et al., 2019; Manniche et al., 2017), the reduction of waste through recovery, reuse or valorization of the disposed materials (Florido et al., 2019; Girard and Nocca, 2017), or through better design, planning and management of food services to reduce leftovers and food waste. In most cases, still, there are no strategies to close the material’s cycles and tend to zero waste, which requires collaboration and symbiotic relations between the hotel industry and the near-by industrial environment (Singh and Giacosa, 2019).

Among the different CE assessment indicators and methods we can highlight the Longevity indicator, the Resource Potential Indicator, the Sustainable Process Index, the Input Output Analysis, the Material Flow Analysis or the Life Cycle Assessment. However, many of the studies and indicators are focused on and developed for a product or territorial level, with a few exceptions that have been developed to evaluate circularity at a company level (Vinante et al., 2021), such as the CE performance indicators created by EU to track organizations’ progress toward the CE (A New Industrial Strategy for Europe, COM 102, 2020) or CE indicators and methods for organizations reported by some authors (Kravchenko et al., 2019; Moraga et al., 2019; Parchomenko et al., 2019; Saidani et al., 2017; Kristensen and Mosgaard, 2020; Lindgreen et al., 2020; Vinante et al., 2021; Franco et al., 2021). From these studies, we can conclude that there is a lack of consensus when evaluating CE because of the quantity and variety of indicators, methods and approaches available. Somehow, one size-fits-all tool for CE measurement is not a viable option. The differences between the type of product and services that they offer, the operations, the supply chains and the connections with other industries suggest that specific industry indicators should be developed to better orient companies’ actions towards CE. Industries and organizations within these industries require their own CE indicators as well as tools to evaluate the degree of CE implementation, which make it simpler to calculate these indicators. This will ease the assessment and the movement towards the CE. Additionally, it will allow organizations to benchmark, market and develop competitive advantages of their progress with respect to their competitors.

Methodology

In this chapter, we propose a basic tool to evaluate the level of circularity in the hotels. This tool is intended to be complemented in the future as hotels take steps towards circularity with one or two more levels. We propose to walk in these levels towards a more detailed and extended model of indicators and to a more detailed number of best practices. Additionally, we suggest that the evaluation based on the indicators should progressively be more centered in the results and less on the actions taken.

The model builds on the existing measurement framework of the Circularity regulations approved by the Balearic Islands for the hotel industry, and proposes extensions to overcome one of the main issues that the regulation lacks of. The proposed indicators in the regulation are scarce and in many cases are not contextualized. Then, it is difficult to use it to benchmark hotels with similar characteristics and are indicators that are very vague to use it as an incentive for actions. That is, hoteliers cannot catch a glimpse of all the good practices that are aligned with CE and that can be implemented with the current indicators. Therefore, we propose a set of good practices indicators to orient the action plan. In other words, by evaluating the circular good practices of the hotel we are, on one hand, informing hoteliers about a set of actions to be taken, and, on the other hand, stablishing the bases for a circularity action plan. The tool is accompanied of a best practices questionnaire to guide the hotel in their journey to the creation of their circularity plan, including the measurement, evaluation and planification of the actions. In addition, the number of possible indicators and best practices are enormous and the InnoEcoTur project aims at facilitating the transition to CE to hotels, which in many cases are SMEs and lack of resources and specific CE knowledge. Then, after evaluating the situation of the industry in several Living labs (InnoEcoTur 2022, 2023), we decided to promote in this first approach as a basic self-assessment tool.

This tool aims to be simple enough for hoteliers to understand, retrieve and calculate the data needed for the indicators and to motivate them to commit to CE. Additionally, we have designed so it can evolve to more and more detailed indicators. For example, related best practices in this initial tool have been grouped and are evaluated together, so in future developments of the tool (i.e. intermediate or advance self-evaluation tool) they can be configured as independent questions, and therefore, evaluate the progression of the hotel in CE at a higher detail. Additionally, scales have been established in the tool considering actual industry data and the tool weights mainly the actions taken over the results. Then, we expect a hotel that has been working in sustainability to perform well in the tool now, and therefore, encouraging them rapidly to evolve other levels of the tool and, therefore, to higher level of circularity. On the other side, a hotel that traditionally hadn’t been engaged in many sustainable initiatives will be able to orient their actions implementing the suggested good practices and start rising their evaluation results with simple measures, maintaining their motivation to improve their circularity in these early stages.

The tool is divided into 5 dimensions: Circularity management, Energy, Water, Waste and Food waste.

We developed the tool in following a step procedure:

  • Step 1. Exploration

    • Identify regulations with mandatory indicators.

    • Identify existing sustainability indicators that are related to circular economy. Tools and guidelines (CTI Tool, 2020; CEEI, 2020; CircularTRANS, 2020; CIRCelligence, 2020; Circulytics, 2020, among others), best practices and RSC related reports in the industry (i.e. Iberostar).

    • Identify existing indicators for circular economy in other industries (Kravchenko et al., 2019; Moraga et al., 2019; Parchomenko et al., 2019; Saidani et al., 2017; Kristensen and Mosgaard, 2020; Lindgreen et al., 2020; Vinante et al., 2021; Franco et al., 2021).

  • Step 2. Analysis

    • Compile indicators and categorize them according to the initial dimensions and the utility (utility measured as how informative is the indicator about the level of circularity of the hotel and how easy is this indicator to obtain and monitor).

    • Select hospitality measures and characteristic useful for comparison purposes (i.e. ADR, occ, revPAR, category, management type, location, etc.) and preselect complementary indicators to build benchmarkable EC indicators.

    • Group the related indicators attending to the purpose and dimension.

  • Step 3: Filtering and selection

    • Filter indicators eliminating redundancies.

    • Separate quantitative indicators and best practices related indicators.

    • Adapt general indicators to industry specifics to be able to compare between hotels. (i.e. indicator per number of occupied rooms, indicator per number of guests, indicator per square meter,…).

  • Step 4: Exploration and selection of scales and levels for quantitative indicators

    • Identify existing scales or value levels for potential indicators (Greenview, AVEN,… .)

    • Eliminate or convert scales from subjective to objective scale.

    • Compare and homogenize indicator scales and levels.

    • Propose level thresholds based on existing information from trusted sources.

    • Standardize scale intervals according to 4 levels of EC (low, medium, high and very high).

  • Step 5: Exploration and selection of the best practices

    • Identify existing best practices.

    • Group them according to their relation (i.e. best practices to reduce water consumption in the room, best practices to reduce water consumption in related services (laundry,…).

    • Elaborate question.

  • Step 6: Distribution and weighting of the indicators.

    • Distribute mandatory indicators in the dimensions. Complete with the relevant quantitative indicators and include dimension related best practices questions.

    • Assign percentages to dimensions and to indicators within each dimension.

  • Step 7: Validation of the tool by experts and hotels (in-progress).

The Self-assessment Tool

To determine the dimensions, we started from the priority areas that are established in Balearic Islands Law on urgent measures for the sustainability and circularity of tourism in the Balearic Islands: Energy, Water, Waste and Food Waste. Additionally, we incorporated a dimension on the Circular planning and evaluation (see Fig. 10.1).

Fig. 10.1
A radial diagram outlines the dimensions of Circular Economy evaluation for hotels, evaluating sustainability, waste management, responsible energy consumption, food origin, food waste reduction, and responsible water consumption and management.

Dimensions of the CE self-assessment tool for hotels

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Each dimension is structured in two parts, indicators and good practices. Both indicators and good practices include the minimums established by Law 3/2022 of the Balearic Islands, and incorporates additional indicators that allow a first circularity assessment of tourist accommodation to be made. For example, Circular Planning and Evaluation includes the list of tasks and actions, periodicity, distribution of resources, investments, protocols and any other human, material and economic means necessary to comply with the circularity plan. In the Energy dimension, the hotels have to report indicators such as the degree of energy efficiency of the building or the installations, the carbon footprint, the percentage of energy coming from renewable sources or the energy storage capacity. Water dimension analyzes, on the one hand, the consumption and self-supply capacity from water resources, and, on the other, the strategy, management planning, facilities and associated equipment related to water consumption. Waste is mainly to increase the correct separation of the different waste fractions that can be properly recycled and, therefore, to reduce the unsorted waste. Finally, Food Waste evaluates incoming food, considering both the proximity and the sustainable origin of the food supply, the food planning and the strategies to reduce leftovers.

Each dimension is divided into two blocks, the data entry part needed to calculate the indicators and the best practices’ part. Table 10.1 summarizes the data provided in each of the 5 dimensions, subdimension and the related indicators used in the evaluation framework.

Table 10.1 Dimensions, subdimension and the related indicators of the CE self-assessment tool for hotels
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Data is combined with hotel’s operational data, such as number of room-nights, number of guest-nights or square meters of the hotel, to obtain the different indicators.

The questionnaire developed by Innoecotur (https://innoecotur.webs.upv.es) includes quantitative data that has to be retrieved by hotel managers and yes/no question related to sets of best practices.

The sources of indicator levels where retrieved based on existing data from public and private organizations working and both hospitality and sustainability indicators. We used Cornell Hotel Sustainability Benchmarking (CHSB) Index (Ricaurte and Jagarajan, 2021) developed by Greenview, Energy distribution for hotels from PricewaterhouseCoopers report (2013), Waste management and circular economy report from EAE Business School (Seguí et al., 2018), Best Environmental Management Practice in the Tourism Sector report (Styles et al., 2013), Manual of good practices for improving the energy efficiency of hotels in the Canary Islands (CEHAT, 2008), World Tourism Organization (UNWTO, 2022) report or the Valencian Energy Agency information on hotels (AVEN, 2003), among others. The sources provided different kind of information for the proposed indicators, some of the data was related to real consumption (i.e. CHSB data), while others were related to best practices values (i.e. European commission report). We avoided those indicators related to overall values because they do not consider the size effect or the occupancy of the hotel. Therefore, we focused on those where the unit of consumption of the indicator was measured per available room, per guest or per square meter. In a few cases, values were related to the category of the hotel or the size in terms of number of rooms. For these cases we considered an average value as a reference.

Quantitative data, such as carbon footprint have to be considered in a way that results from different hotels can be compared and considering the operational characteristics of the hotel. For example, although the Law 3/2022 requires the calculation of the annual carbon footprint per overnight stay, this indicator does not consider the size of the hotel. Therefore, we included in this type of indicators the evaluation of the indicator per square meter to overcome the size effect.

Some of the key measures, such as the energy or water consumption, were extracted from The Cornell Hotel Sustainability Benchmarking Index (Ricaurte and Jagarajan, 2021). The CHSB index is an indicator that benchmark hotels around the world in different sustainable indicators such as carbon footprint, energy or water. It covers more than 25,000 hotels from different geographical regions. The index indicators provide a good base value to consider hotel performance for energy and water dimensions. Particularly, for the Mediterranean area we were able to retrieve data from 600+ hotels belonging to Mediterranean costal area and 500+ to Mediterranean interior area. Data is provided in quartile values for indicators. We used quartile weighed average values for the two regions (1100+ hotels) as threshold values for our scales. Additionally, CHBS already includes industry related base to the indicators as it gives information per occupied room and per square meter. We complemented the information with other sources such as the Best Environmental Management Practice in the Tourism Sector report (Styles et al., 2013) or the guide to saving and energy efficiency in hotel establishments in the Valencian Community (AVEN, 2003). In the first one, we found several threshold values for best practices that are aligned with Circular indicators. For example, Hamele and Eckardt (2006) state that in European hotels, every guest consumes on average around 394 liters per night, while a best practice for water consumption is reported to be an average water consumption less than 200 liters/tourist and day, corresponding less than 140 l/guest-night for accommodations (Styles et al., 2013). The second document indicates that an excellent hotel should have Energy consumption lower than 240–365 kw/m2-year and Water consumption lower than 120–220 l/guest-year depending on the size, measured by the number of rooms. These and other sources, such as Manual of good practices for improving the energy efficiency of hotels in the Canary Islands (CEHAT, 2008) or Waste management and circular economy (Seguí et al., 2018) have been used to calibrate the indicator levels of the different indicators.

Energy certification indicators are defined as a letter scale from A (the most efficient) to G (the least efficient). We converted the letter scale to a numerical scale from 1 (“A” certifications) to 0 (“G” certifications) and evaluated the hotel according to the numerical scale.

Percentage indicators reported in the questionnaire are considered and evaluated attending to a reasonable maximum value. For example, for the percentage of energy coming from renewable energies, the maximum value that we found in a hotel is 38%. Taking into account that all the energy would be difficult to come from renewable sources, we set a maximum value in 30% and distributed the evaluating points accordingly. Thus, a hotel with 15% of the energy from renewable sources will get 50% of the points in this part. In the cases where high percentage values can be achieved, i.e. amount of personnel with CE training, we maintained the scale from 0 to 100% and the corresponding percentage of the points were assigned.

Best practices in each question are evaluated as a set and hotels either have implemented any of these best practices or not. Best practices have been also grouped in each dimension attending to the area of the dimension which they are related to, i.e. water saving best practices related to the hotel room. Therefore, for each dimension the questionnaire asks for different sets of best practices. The evaluation of best practices is done by evaluating the positive responses overall. Thus, a hotel performing at least one of the best practices in a specific area (one question in the questionnaire) will get full credit for that question. This has been designed for different purposes. First, we want to motivate hotels that have been working on sustainability highlighting the previous effort done. Second, these allows the tool to promote other best practices that hotels haven’t implemented yet and that can be included in the circularity plan. Third, this will allow more advanced levels of the tool to disaggregate the best practices into single questions, giving credit only on those best practices that have been implemented and, therefore, pushing hotels to advance and implement further actions towards circularity.

Table 10.2 summarizes the evaluation scheme. We distributed one hundred points into the 5 dimensions, 20 each, and assigned a specific percentage of these points to each of the subdimensions attending to the importance of these indicators in the journey towards CE. Additionally, Table 10.2 includes the maximum and minimum values in the scale and the threshold for the 4 evaluation levels that we have established, low, medium, high, very high, level of circularity. Then, each hotel will get an evaluation in each dimension and subdimension and an overall evaluation of circularity based on the points scored in each area.

Table 10.2 Scales and score distribution for dimensions and subdimensions of the CE self-assessment tool for hotels
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Conclusions

There is an increasing concern on the part of the hoteliers regarding the sustainability and the waste generated by their respective hotels. Hotels have monitored and measured sustainability indicators so far for a long time. As indicated previously, this approach has been mainly oriented to the reduction of the consumption in energy, water or waste, among others. However, reduction is just compatible with both linear and circular strategies and scraps only on the top of the surface on what it can be achieved. Indeed, there has been great effort on improving areas such as energy efficiency but decisions in a linear model are taken in many cases based purely on power consumption ignoring other factors that are also important for the environment. For instance, the energy and resources consumption for the production of the new devices, the recyclability of the materials of the new devices, the consumption of energy to recycle or dispose the old devices or how old devices are going to be disposed, recycled, etc. In other words, there are far more elements to take into account if we want to be circular than just efficient in terms of energy use. On the other side, sustainability measures have been focusing mainly on the operational part of the hotel business, while CE promotes that circularity starts in the design part. That means, where do we locate the hotel, how do I construct it, which materials do I use, how it is distributed, oriented, etc. There are many decisions to take in this phase that will condition the circularity of the hotel in the long, medium and short term. The problem in this area comes from the scarce circular knowledge, best practice solutions or suppliers that can guide the hoteliers to design more circular hotels.

CE is a complex concept, specially when we think about measuring how circular something is or how one solution might be more circular than another. Therefore, we need to seize it taking small steps to a more circular operation. Additionally, the complexity of Circular Economy and the limited resources that many small hotels have, requires measures that are easy to understand and calculate and that don’t disincentive hoteliers in the expected long journey towards circularity. In this chapter we proposed a self-assessment tool to introduce hotels in the evaluation of their degree of circularity.

Currently, there are instruments that have been introduced recently that can gauge an organization’s level of circularity and most of the have not yet adopted by the organizations. The complexity of the CE concept and the diversity of the activities that can be in the organizations makes it difficult for these instruments to really fit to the needs of certain industries. In many cases, the instruments are focused on the design of products, they use perception scales, or indicators that cannot be used to compare organizations with different characteristics, such as the size or the level of activity. The importance of sustainability and tourism as a priority industry to meet the environmental goals of the European Union, and the lack of suitable tools addressing industry specifics, suggests that we need to advance in tailored made tools and solutions that can push sustainability actions in hotels. Pioneer initiatives in policy making, such as the Balearic Islands law on urgent measures for the sustainability and circularity of tourism in the Balearic Islands have initiated a path determining priority areas for hotels to move towards CE. It sets an obligation to measure and plan actions through the use of Circularity Plans. Although this is a good starting point, it lacks on indicators that are interesting to evaluate the circular progress and to benchmark hotels circular performance. Additionally, the law does not propose an evaluation scheme which is a key point nowadays to show and market the level of achievement in a certain topic.

In this chapter, we have built on the law’s proposal. We created an additional dimension or priority area. We added additional indicators that have been adapted considering industry references for hotel activity, such as room-nights or guest-nights. We included a set of best practices indicators and best practices questionnaire to evaluate the level of sustainable actions of the hotels and as an information tool for hotels where to determine the actions that can be included in their circularity plan. Finally, we created an evaluation scheme which evaluates hotel in a scale 0 to 100 in the 5 dimensions created.

This self-assessment tool is an initial approach and needs a validation step. We have proposed as future lines of research two stages to validate the tool. First, we will submit the tool to a group of experts to determine the usability and potential user experience of the tool, determine additional information or training that might be needed for hoteliers to complete the questionnaire. Second, we will test the tool on a group of hotels to adjust the scales and the evaluation scheme, that is, adjusting the threshold levels, maximum or minimum values, and allocation of point to each of the dimensions.

As indicated in this chapter, the tool has been designed as a starting point to measure, evaluate and manage CE in a hotel. The industry will evolve and circular economy practices will be assumed for more and more hotels, and more indicators and best practices will be required. Thus, we propose a tool that can be scalable, creating one or two more levels in the future. These levels we think that should include more detailed quantitative indicators (i.e. % of textiles that come from organic or recycled materials) more detailed best practices and should be more focused on the quantitative results rather than on the actions taken.