Green Growth And Tourism

Media Info

The transition towards a greener economy will be a long and challenging process for tourism, as for many other sectors. Tourism, as a transversal sector interacting with many other industries and services, can contribute significantly to the shift towards more sustainable, cleaner and low-carbon economic growth. Entrepreneurs and policy-makers are increasingly looking at innovation as key to improving environmental performance and achieving sustainable targets.  Innovation is also essential to improve existing products and to develop more sustainable tourism products and experiences.

The OECD Tourism Committee is currently completing a report on green innovation in tourism services, which aims to:

• analyse the role of green innovation in the transition of tourism enterprises to a green economy;
• better understand how green innovation in tourism is supported by government and industry; and
• identify ways to accelerate the diffusion of green innovation in the sector.

A report on “Business Model Innovation (BMI) in the Tourism and Experience Economy”, developed by Nordic Innovation upon commission from the Nordic Council of Ministers and in close co-operation with the OECD Tourism Committee, is an important element of the Tourism Committee’s activity on green innovation in tourism. With 28 business cases from ten countries (Austria, Denmark, Finland, Iceland, Mexico, Norway, Portugal, South Korea, Sweden, and Russia), providing insights into how businesses work strategically with green business model innovation, focusing on value creation and green innovation, the BMI project provides a unique industry perspective in OECD countries.

Approaches to green innovation in OECD member countries
OECD analytical work, based on a country survey, indicates a general recognition of the benefits associated with developing a more environmentally sustainable tourism industry, and the role that green innovation can play in shifting to a greener economy. The importance of a co-ordinated approach to fostering green innovation in tourism is also clear, with the majority of countries identifying initiatives that support green innovation in tourism, located in three or more different government departments. Thus clearly demonstrating the need for a whole of government approach, in order to maximise synergies and reduce duplication in the support available to tourism businesses.

Over two-thirds of OECD countries indicated that they have initiatives in place to encourage ‘improved environmental performance and/or sustainability’, which also encourage innovative practices in the tourism sector. Examples of the various approaches taken in respondent countries include:

• development of strategies and setting of targets for improved environmental performance;
• establishment of advisory groups to support green growth;
• establishment of networks to promote R&D; and
• award schemes to reward innovation.

Drivers and barriers
Over two-thirds of countries nominated one or more key drivers for green innovation in tourism, ranging from a whole of government policy approach with an environmental or sustainability focus, to a combination of factors, including: i) a general increase in environmental focus; ii) consumer demand; iii) political commitment; iv) a sound innovation policy environment; v) education; and vi) the business case for green innovation.

A similar number of countries nominated one or more barriers to the introduction of new or significantly improved products, processes or methods to improve environmental sustainability. The barriers mentioned most often were: i) business and/or consumer information gaps relating to the potential environmental and economic benefits associated with adopting more sustainable practices; ii) the perceived investment costs for businesses (primarily SMEs) to develop or adopt initiatives to improve environmental performance; iii) consumer reluctance; and iv) industry capacity.

In addition, a range of success factors necessary to help facilitate green innovation in tourism were identified, including industry co-operation, horizontal government integration, and buy-in or support from key public and private sector stakeholders.

Key messages
The following have been identified as potential areas of policy focus to improve diffusion of green innovation in the tourism sector:

• A more strategic and co-ordinated approach to fostering innovation and a cleaner more sustainable environment will require horizontal and vertical policy co-ordination, and closer integration of multiple policies.
• Improving the overall business environment for innovation is essential to green innovation and requires implementation of a broad-based innovation strategy.
• Stable and long-term market signals, based on the pricing of the environmental externalities, are core for a strong and comprehensive strategy for green growth and for green innovation.
• Well-designed demand-side policies, such as public procurement, standards and regulation.
• Better educating the public and tourism businesses as to the environmental and financial benefits associated with adopting and supporting green innovation.

The OECD report on Green Innovation in Tourism will integrate the findings from the OECD/Nordic Innovation BMI project. The final report, including extended policy recommendations, will be reviewed and examined by the OECD Tourism Committee on 24-25 September 2012.