Can you keep what you promised? Expectations vs. Reality

Can you keep what you promised? Expectations vs. Reality

We all have that one friend who excels at sales – the kind of person who has a way with words and can make you believe anything, regardless of the subject. They set high expectations, but at some point you have to face reality (see Figure 1).

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Figure 1: Expectation vs. Reality

A common misconception is that sustainability reporting is simply about embellishing a company’s environmental practices and making them look more “green” than they actually are. Many believe the goal is to make any business sustainable overnight. But that is not correct. Let’s draw a parallel with something that’s common in the business world: financial reports, like the income statement. Assuming your financial data shows losses, should you hide or misrepresent them? The correct answer is no. Financial reports are designed to track progress, whether the numbers are in your favor or not.

According to the principle What gets measured gets managed.” Any system that enables progress tracking has inherent value. This also applies to sustainability or ESG reporting, which is about transparently monitoring your environmental and social impact. With the new CSRD rules, these reports even include an audit component to increase credibility, similar to financial reports. Why? Because sustainability has become a big trend and every brand wants to attract environmentally conscious consumers and their money. Just think back to that sales-savvy friend.

In the hospitality industry, this pressure is even greater. As a guest-centric industry, hotels, restaurants and tourism businesses are expected to meet sustainability benchmarks and communicate them effectively to an increasingly environmentally conscious audience. Transparency is not just good practice; it is now a competitive advantage.

It is often difficult to distinguish between genuine sustainability efforts and greenwashing. Take, for example, a recent case in which a large non-European company is facing a class action lawsuit over a misleading sustainability campaign (see Figure 2). This campaign boldly claimed, among other things: “Our products and actions prevent environmental damage and help restore a healthy planet.” The phrase “prevent environmental damage” is particularly worrying. Is it possible for every company to operate without negative impacts?

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Figure 2: Example of a false claim

Unfortunately the answer is no. Economic activities inherently generate negative externalities– unintended impacts on third parties, such as pollution, noise, traffic congestion and waste of resources. It is impossible to run a business without negative impacts because all businesses consume resources and impact the environment.

For hotel companies, these externalities can range from excessive energy consumption in hotels to wasteful supply chains or carbon-intensive tourism practices. Addressing these challenges requires industry-specific strategies, such as energy-efficient building designs, waste reduction programs or partnerships with local suppliers.

So what can we take away from this example? Don’t let marketing or sales philosophy dictate the sustainability narrative– They exist to meet customer expectations and therefore sometimes emphasize attractiveness over accuracy. This approach may be successful in sales, but when it comes to sustainability, there is a risk that these expectations will remain unfulfilled. With new regulations such as the EU Green Claims Directive and similar frameworks around the world, ensuring accuracy and transparency in sustainability messaging is no longer optional, but a legal and ethical necessity. Hospitality leaders should balance sustainability narratives with actionable commitments backed by transparent data. Adhere to core reporting principles. The ESRS data quality standards– relevance, accuracy, completeness, comparability, reliability, consistency, timeliness, traceability and standardized format – are designed to elevate sustainability reporting to the same level of accuracy as financial reporting. These requirements help ensure that companies’ data/information reports are accurate, meaningful to stakeholders and consistent with CSRDs broader sustainability/ESG transparency and accountability goal.

At Hotelschool The Hague, we believe that sustainability reporting is not just a compliance exercise, but an opportunity to lead by example in the hotel industry. As educators and researchers, we are committed to equipping future leaders with the tools to meet these challenges responsibly and strategically.

If you would like to know more about the example discussed in this article, please feel free to contact us. For further information please email Melinda Ratkai.

By Melinda Rakai
Dr. Professor of Hotel Management

About Melinda
Dr. Melinda Ratkai, originally from Hungary, received her PhD in SME Management and Economics from the University of Huelva, Spain, in 2014. She is a professor at Hotelschool The Hague and focuses on corporate governance and reporting. With over a decade of experience in management economics and digital accounting/financing, Dr. Ratkai specializes in frameworks for corporate sustainability reporting. Her work helps the hotel industry adapt to new reporting requirements, promote ethical and ESG-conscious business practices, and engage sustainability-focused stakeholders.

Nina de Graaf
Hotel School The Hague

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