The Corporate Sustainability Reporting Directive (CSRD), introduced in the European Union (EU) in 2023, will have implications for small African travel companies with connections to the European market as the legislation forces greater transparency in reporting on sustainability practices of large companies and their value chains.
The CSRD requires large and listed companies to report on their sustainability risks and impact. Disclosure of sustainability, performance and risk management strategies will filter to smaller companies within their supply chains.
Speaking during a webinar hosted by the African Travel and Tourism Association (ATTA), Elfrieke van Galen, Partner at sustainability consultancy The Rock Group said, in the EU, the tourism industry’s environmental impact and over-tourism are under a microscope.
The CSRD comes at a time when sustainability legislation is increasing globally and concerns about over-tourism, especially in the EU, are starting to replace the narrative about the tourism industry’s economic impact, she added.
“The CSRD and similar regulations boost tourism transparency with mandatory reporting on environmental, social and governance or sustainability impacts,” Van Galen pointed out.
Another noteworthy emerging regulation is the Corporate Sustainability Due Diligence Directive that compels companies to identify and address adverse human and environmental impacts in their operations and supply chains.
While focus is on large companies, there will be an impact on the African tourism supply chain.
Van Galen noted increasing pressure for transparency and measurement of sustainability initiatives and a push to reduce any negative impacts of tourism on society.
Melissa Foley, Conscious Travel Adviser for ATTA, said the change is starting to impact the supply chains and B2B partners who are being called to account.
Companies based and headquartered in the EU are expected to suffer the implications and ramifications of non-compliance by their suppliers.
“If you don’t have a plan and transparent, measurable systems, it’s going to be a problem for them to use you,” Foley said.
Van Galen said the best way to get ahead is to start. Key to this is measuring and managing sustainability programmes – making this visible to guests and clients and asking clients and partners what they expect, she pointed out.
The four main elements to track are:
- Carbon reduction
- Waste reduction
- Staff wellbeing
- Community impact of business operations.
Van Galen also advised businesses to start measuring not just to appease EU partners but for their own benefit, and to structure and advance sustainability efforts in the business.
“Don’t wait,” Foley urged African businesses with EU partners. “This is happening now.”
ATTA is working closely with several industry bodies to ensure relevant information is clearly communicated and to avoid fragmented and conflicting messaging.
