Post-pandemic recovery has ushered in an era where the environment and sustainability are paramount. For the travel industry, the spotlight is on new mandatory emissions reporting standards. As the The World Travel & Tourism Council (WTTC) points out, navigating this evolving landscape requires commitment and innovation. Let's delve into how corporate travel programs worldwide are set to change.
A Global Move towards Eco-Transparency
A noticeable wave of change is washing over the global business scene. In 2024, the EU will introduce rigorous disclosure norms, compelling large-scale corporations to be transparent about their greenhouse gas emissions. These regulations not only mandate the collection of relevant data but also the creation of annual plans outlining emission reduction tactics. All these efforts converge towards one objective — keeping the Earth's temperature rise under 1.5 degrees Celsius, as per the 2015 Paris climate agreement.
Eco-awareness is not limited to the EU. Nations worldwide, including Canada, Singapore, and increasingly the US, are adopting parallel climate transparency measures. The International Sustainability Standards Board’s (ISSB) recent unveiling of a global sustainability accounting framework underscores this trend, highlighting the imperative for comprehensive greenhouse gas emissions disclosures.
In the US, regulatory bodies like the Securities and Exchange Commission (SEC) are poised to introduce stricter reporting standards for businesses. Moreover, states such as California are considering their own set of environmental regulations. It appears inevitable that emissions reporting mandates will soon influence a vast majority of global businesses.
Corporate Travel's Eco-Journey
The statistics from the WTTC reveal an eye-opening fact: travel and tourism are responsible for 8.1% of the world’s greenhouse gas emissions. While several industry leaders have sketched out long-term plans to cut emissions by 2050, others are just starting to grapple with their environmental impact.
This transition comes with a set of challenges:
- Diverse Operations:
Corporate travel programs, with footprints across various countries and sizes, face the challenge of ensuring consistent compliance across all units. Integrating data from various partners, subsidiaries, and suppliers will be a significant endeavor.
- Budgetary Concerns:
Small and midsize entities, which form about 80% of the sector, often work with constrained resources, making it challenging to prioritize and invest in new compliance processes.
- Broadening Expertise:
Historically, the role of sustainability teams in travel companies was restricted to branding or operational facets. But with these new mandates, there's a pressing need to expand their expertise to include comprehensive data management and reporting.
Navigating the Data Maze
Accurate data collection is at the heart of this new reporting mandate. Given the vast and varied supply chains, many travel companies operate within, gathering consistent and accurate business travel data, especially related to Scope 3 emissions, is no minor feat.
The industry's fragmented nature underscores the need for a unified approach, especially in the early stages. With investments being split between data collection and other sustainability initiatives, strategic financial planning becomes crucial.
Envisioning the Future of Corporate Travel
Mandatory emissions reporting is more than just a check in a box—it embodies a fundamental shift in how the industry operates. Though the journey seems complex, it's also an opportunity for corporate travel programs to reinvent themselves and champion sustainable travel.
For us at Traxo, this transition marks a period of enhanced collaboration and support. We're geared up to aid our partners and clients with comprehensive travel data as they chart this unfamiliar territory. By harnessing the power of technology and data-driven strategies, we're eager to streamline the reporting mechanism and contribute to reducing the environmental impact of corporate travel.
To learn more about how Traxo can help your mandatory emissions reporting efforts, reach out to us today.
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