Sustainability in the Hospitality Industry: Key Trends & Challenges

The hospitality industry is built on anticipation. Hotels prepare for seasonal surges in guests, while restaurants plan for busy meal periods, often keeping extra food, energy, and staff on hand to meet demand. The challenge for these businesses is balancing operational readiness with sustainable resource management, especially as consumers become increasingly conscious of their carbon footprints. In fact, according to a recent Booking.com study, the share of global travelers who say they want to make more sustainable travel choices grew from 42% in 2016 to 93% in 2025. That shift is pushing hospitality businesses to make sustainability a higher priority.

This article explores the environmental hurdles the industry faces and outlines several sustainable strategies, such as green building design, smart procurement practices, water conservation programs, and advanced technology platforms that monitor and minimize waste.

What Is Sustainability in the Hospitality Sector?

Sustainability in the hospitality sector refers to the practice of operating hotels, resorts, restaurants, and other hospitality businesses in ways that minimize environmental impact, support local communities, and maintain the long-term financial viability of the business. In practice, that might mean restaurants reducing food waste, hotels conserving water in their laundry facilities, or resorts improving energy efficiency and sourcing from local suppliers—all while preserving an exceptional guest experience.

Key Takeaways

• The hospitality industry makes a significant environmental impact through high energy and water consumption, supply chain emissions, and substantial waste from food and single-use products.
• Hospitality businesses are prioritizing sustainability due to rising guest expectations, stricter regulations, and the potential to save on utility expenses.
• New hotel and restaurant projects often feature energy-efficient building designs, natural ventilation, high-performance windows, and renewable energy systems.
• Many businesses are adopting circular resource management practices, such as refillable amenities and composting programs, to cut down on landfill waste.
• Advanced technology, including AI, is increasingly essential in hospitality, helping businesses forecast demand more accurately and manage their resources more effectively.

Why Is the Hospitality Sector Paying Attention to Sustainability?

Hotels, resorts, and restaurants are increasingly treating sustainability as a core business strategy, not just as a values statement. The reasons include attracting eco-conscious guests, lowering operating costs, and meeting expectations from investors and regulators regarding environmental, social, and governance (ESG) performance. Here are some specific factors driving the shift:

• Alignment with guest expectations: Travelers are paying more attention to sustainability when planning trips—and they expect the hotels and restaurants they choose to do their part. Indeed, the Booking.com study found that traveling more sustainably is important to the vast majority of travelers—84%—and that they expect the hospitality companies they patronize to be transparent about their efforts.
• Rising regulatory demand: Sustainability requirements are expanding worldwide, which is pushing hospitality businesses to track and disclose metrics, such as greenhouse gas emissions, energy and water consumption, and climate-related risks, as well as to outline their sustainability goals. Recent examples include the European Union’s Corporate Sustainability Reporting Directive and California’s climate disclosure laws, which require companies to disclose detailed information about their environmental impacts.
• Brand differentiation: In a crowded market where businesses may struggle to one-up competitors, emphasizing sustainability efforts, such as green building standards and more thoughtful laundering practices, can help brands strengthen their image, especially among environmentally conscious travelers.
• Cost benefits: Electricity often hums 24/7 in hotels, which makes any efforts to improve efficiency particularly valuable. Taking green steps, such as installing LED lighting, smart energy-management systems, water-saving fixtures, and waste-reduction programs, can lower utility costs, cutting operating expenses in the process.
• Corporate social responsibility: In addition to guests, investors, employees, corporate clients, and local communities increasingly expect hospitality businesses to demonstrate responsible sourcing, ethical labor practices, and measurable environmental progress as part of their broader corporate social responsibility efforts.

Environmental Impacts of the Hospitality Industry

From hotel guest rooms and restaurant tables to laundry facilities and swimming pools, hospitality businesses consume significant amounts of resources. Some of the industry’s biggest environmental impacts are:

• Energy: Keeping guests comfortable around the clock requires a tremendous amount of energy. Consider the nearly constant use of heating and air conditioning systems, elevators, commercial kitchens, refrigeration equipment, laundry facilities, and lights—no wonder hotels and restaurants are among the most energy-intensive commercial buildings. A 2024 systematic review and analysis of 28 individual studies found that energy use is the major source of carbon emissions in hotel buildings, since they must use significant amounts of electricity to power not only guest rooms, but conference spaces, spas, and onsite dining facilities.
• Water: Every freshly laundered towel, landscaped courtyard, hotel pool, restaurant meal, and guest shower adds to the hospitality industry’s substantial water consumption. For properties in drought-prone regions or destinations facing seasonal tourism surges, water can become one of the most scrutinized resources, requiring hotels and restaurants to balance guest expectations of comfort against growing concerns about scarcity and infrastructure strain.
• Emissions: The environmental footprint of hospitality extends well beyond a property’s walls. Hotels and restaurants rely on vast supply chains to source food, beverages, linens, furniture, cleaning products, and other goods from around the world. A 2024 study estimated that tourism accounts for about 8.8% of global greenhouse gas emissions. A five-star restaurant, for example, may import seafood, wine, and specialty ingredients from multiple countries, which requires reliance on a complex distribution network that generates emissions, too.
• Waste: Hospitality businesses often err on the side of excess, with hotels and restaurants stocking more food than they expect to serve and extra supplies as a hedge against fluctuating demand, all of which can contribute to significant waste. Buffets, catered events, and banquet operations are especially prone to food waste, as managers balance guest satisfaction against the risk of shortages. Besides food, items like miniature toiletry bottles, takeout containers, disposable cups and utensils, coffee pods, and other single-use service products can create a bigger waste stream, especially at large properties that serve thousands of guests each week.

Sustainable Practices in the Hospitality Industry

Hospitality businesses are looking beyond simple cost savings to rethink how properties are built, operated, and supplied. Cutting waste. Lowering energy consumption. Supporting local ecosystems. Companies are finding a variety of creative ways to lower their environmental impact while appealing to environmentally conscious travelers and diners.

Sustainable Building Design

New hospitality establishment designs often incorporate energy-efficient building envelopes, natural ventilation, high-performance windows, and renewable energy systems. Some properties are pursuing certifications, such as Leadership in Energy and Environmental Design, where developers and owners earn points for meeting specific criteria, such as installing energy-efficient HVAC systems, using low-flow plumbing fixtures, sourcing recycled building materials, and improving natural lighting. Others are adapting existing buildings rather than constructing new ones, avoiding the emissions associated with demolition and new construction.

Sustainable Procurement and Sourcing

Given that hospitality businesses purchase enormous quantities of food, beverages, linens, furnishings, toiletries, and cleaning supplies, their procurement decisions have an outsized environmental impact. Many hotels and restaurants are building sustainability into their supply chains by sourcing ingredients from local farms and fisheries to minimize transportation emissions and support small regional businesses. At the same time, some companies are shifting toward certified products, such as those verified by Fairtrade International or the Marine Stewardship Council, which provide third-party assurance that goods like coffee and seafood meet certain environmental and labor standards. In addition to food, sustainable procurement strategies extend to everyday items, including refillable bathroom amenities and low-toxicity cleaning products.

Energy Efficiency

The most sustainable energy strategy is simple: Find ways not to use power in the first place. Advances in smart building technology allow hotels to automatically adjust heating, cooling, and lighting based on occupancy in order to limit waste in unoccupied rooms and common areas without compromising guest comfort. Meanwhile, restaurant operators are investing in high-efficiency induction cooking, Energy Star-rated refrigeration, and advanced ventilation systems that cut down on the heavy electrical load of commercial kitchens, where equipment often runs for long hours under high heat conditions.

Waste Reduction and Recycling

Unlike many industries, hospitality businesses can’t simply manufacture products created to match the demand that’s in front of them. Restaurants must prepare enough food in anticipation of bustling lunch and dinner periods; hotels must keep pools and spas clean, regardless of whether they’re used daily; and event venues must plan for attendance that may fluctuate at the last minute. In response, many companies are adopting more circular approaches to resource management, including refillable amenities, composting programs, and food donations to divert waste from landfills. To help, hospitality businesses are turning to AI-powered inventory tools that can analyze previous usage rates and better forecast demand to limit overordering.

Water Conservation

As droughts and water stress become more common in many tourist destinations, hospitality businesses are feeling the pressure to do more with less while maintaining water-intensive amenities—swimming pools, spas, golf courses, landscaped grounds. Many properties are adopting technologies to conserve consumption, such as smart irrigation systems, leak-detection sensors, and low-flow plumbing fixtures. Linen and towel reuse programs have also become more common, helping hotels lower water use associated with laundry operations. These efforts not only shrink a company’s environmental footprint, but they also help it manage costs, strengthen resilience during droughts, and maintain positive relationships with local communities that are competing for the same resources.

Digital Transformation

Advanced analytics platforms let hospitality companies identify inefficiencies in their building systems, and smart sensors monitor energy and water use in real time. Digital menus, mobile check-in systems, and electronic receipts all help curb paper consumption. Hotels and restaurants are also employing AI to forecast occupancy, predict customer demand, optimize inventory, and adjust staffing levels to minimize resource use during slower periods. Some properties are even experimenting with agentic AI systems that can automatically manage routine operational decisions, such as adjusting heating and cooling, identifying maintenance issues before they become costly repairs, or controlling food waste by aligning purchasing decisions more closely with expected demand.

Biodiversity Support

For many hospitality businesses, the surrounding environment helps drive sales, since guests may choose a beachfront resort for its coral reefs or a mountain lodge for its views, for example. As a result, protecting local ecosystems has become necessary, leading hotels and resorts to invest in habitat restoration, native landscaping, wildlife conservation, and partnerships with environmental organizations to help preserve the natural assets that attract visitors. One property might replace water-intensive ornamental plants with native species that support local wildlife, for instance; another might participate in a beach preservation or forest conservation project.

Natural Design

Biophilic design—the practice of incorporating natural elements into built environments—is gaining traction in the hospitality sector. Hotels and restaurants are introducing plant-covered living walls, wood and stone finishes, indoor gardens, expansive windows that bring natural light deeper into buildings, and outdoor gathering spaces that blur the line between indoor and outdoor environments. Beyond their aesthetic appeal, these features can improve indoor air quality and reduce reliance on energy-intensive artificial lighting and climate-controlled systems.

Chemical Choices

The cleaning products, pesticides, paints, and maintenance chemicals used in hospitality operations to clean rooms, wash linens, sanitize kitchens, maintain pools, control pests, and care for landscape grounds can have significant environmental impacts. Many businesses are replacing harsh chemicals with lower-toxicity alternatives that decrease risks to employees, guests, and surrounding ecosystems. Green cleaning programs have become particularly popular in hotels, where housekeeping teams use environmentally preferable products certified by organizations like Green Seal. Some businesses are also limiting their reliance on routine pesticide applications by focusing on preventive measures, such as improved sanitation, while also choosing paints that are low in volatile organic compounds, adhesives, and finishes that can both improve indoor environmental quality while curbing harmful emissions.

Sustainability Risks and Challenges in the Hospitality Sector

As hospitality businesses strive to minimize their environmental impact, they face a variety of risks. Among the major challenges are:

1. Investment costs: While sustainability initiatives can generate long-term savings, they often require significant up-front capital, which can stress businesses already coping with tight margins. Green construction practices can add to initial project costs, depending on the scope of the upgrades and certification standards. Costly improvements may include high-efficiency HVAC systems, buildingwide energy management platforms, kitchen equipment upgrades, and renovations to older properties that weren’t designed with energy performance in mind—all of which can strain budgets, particularly for smaller hotels and independent restaurants.
2. Increasing regulations: Hospitality businesses are feeling growing pressure to comply with sustainability regulations that are steadily shifting from voluntary reporting to more formal, standardized requirements. In the EU, directives require companies to disclose detailed data on energy use, emissions, water consumption, and supply chains, while also extending sustainability responsibility deeper into their global supply chains. And in the US, a combination of federal initiatives and state-level legislation is moving in a similar direction, requiring larger companies to report climate-related risks and greenhouse gas emissions.
3. Greenwashing allegations: With travelers increasingly skeptical of environmental claims that lack clear evidence, hospitality companies must substantiate their messaging. Industry watchdogs and regulators have repeatedly flagged hotels for promoting green initiatives and certifications that, on closer inspection, are based on self-reported data or lack rigorous third-party verification—making properties appear greener on paper than in practice. The US Federal Trade Commission’s “Green Guides” emphasize that environmental claims must be specific, measurable, and not misleading, pushing businesses to move from broad, eco-friendly branding to more data-driven disclosures.
4. Supply chain resilience: A 2024 study found that the complex nature of the tourism and hospitality industry makes it especially susceptible to problems when supply chain resiliency is low or nonexistent. And many sustainability initiatives in the sector depend on conditions that hotels, restaurants, resorts, and event venues can’t directly control. Restaurants that rely on sustainably sourced seafood, for instance, may face shortages or sharp price changes when severe storms affect fisheries and distribution networks. And a hotel property might commit to eco-friendly amenities and low-carbon packaging, but those efforts can be disrupted quickly by transportation delays, labor shortages, and geopolitical conflicts.
5. Noncompliance risks: Hotels, restaurants, and other hospitality businesses must deal with a web of requirements related to energy use, emissions reporting, waste management, water conservation, and environmental disclosures. Failure to comply can result in fines, legal action, increased operating costs, and reputational damage. For example, New York’s restrictions on small plastic toiletry bottles in hotels include civil penalties for violations, and large hospitality properties can face significant financial penalties for exceeding building emissions limits. Meanwhile, regulators have also taken enforcement action against hotel operators for environmental violations, including wastewater and stormwater compliance issues.

How Does Software Enable Hospitality Sustainability?

The hospitality industry is inherently volatile, with occupancy, foot traffic, and bookings fluctuating by the season—or even by the day. That makes sustainability challenging, because hotels and restaurants often create buffers with extra food, energy use, and staffing that they may not end up needing. Software helps squelch that uncertainty by turning real-time and historical data into more accurate demand forecasting, allowing operators to better align resources with their actual needs.

Consider food waste, one of the hospitality industry’s most persistent sustainability challenges. Restaurants and hotels frequently struggle with overordering, spoilage, and inaccurate demand forecasting. AI-enabled ERP software can help managers monitor inventory levels, purchasing patterns, and occupancy forecasts to bring procurement more closely in line with demand. Similar benefits apply to energy and resource management. By integrating data from multiple properties and departments, hospitality businesses can identify unusually high utility consumption, track sustainability metrics across locations, and measure the financial return on lower energy bills. AI-driven optimization tools can also detect patterns across sites and automatically suggest adjustments to reduce waste and energy usage. Meanwhile, ERP systems for the hospitality industry also play an important role in compliance and reporting by automating data collection, monitoring performance, and improving accuracy.

Supercharge Green Hospitality Initiatives With NetSuite ERP

Successful sustainability in hospitality depends on a property’s ability to measure, manage, and minimize resource consumption in real time. By integrating procurement, inventory, finance, and operations into a single platform, NetSuite Hospitality ERP allows hotels, restaurants, and event venues to track environmental impact in line with business performance. A restaurant can link food purchasing directly to consumption patterns to avoid overordering, spoilage, and kitchen waste. A hotel can monitor its use of energy, water, linens, and amenities across properties, identifying outliers where consumption is extra high and targeting interventions to cut costs and emissions at the same time. The system also provides visibility into sourcing decisions, allowing hospitality businesses to prioritize local, lower-impact suppliers and track adherence to standards. Meanwhile, NetSuite’s AI capabilities are continuously analyzing operational data to improve forecasting accuracy, anticipate spikes in demand, and recommend adjustments to purchasing, staffing, and resource use to cut down on waste.

NetSuite ERP for the Hospitality Industry

Hospitality has always relied on a certain amount of excess to guarantee a stellar guest experience, but the industry has been moving toward less abundance and more precision: knowing what will be needed, when, and how to deliver it without overproducing. For hotels, restaurants, and other hospitality businesses intent on going greener, sustainability entails doing more with what they already have and using data, technology, and smarter processes to eliminate waste while maintaining the level of service guests expect.

Sustainability in the Hospitality Industry FAQs

What’s sustainability in the hospitality industry?

Sustainability in the hospitality industry is the practice of delivering lodging, dining, and travel-related services in ways that preserve natural resources and support long-term business resilience. This includes reducing energy and water use in hotels, minimizing food waste in kitchens, and limiting single-use plastics.

What’s an example of sustainability in hospitality?

One example is a hotel using smart building technology to automatically adjust heating, cooling, and lighting based on room occupancy. Some AI-enabled platforms can further refine these systems by predicting demand and optimizing energy use throughout the property, thereby reducing both operating costs and environmental impact while maintaining a comfortable atmosphere for guests.