sustainability

Article
Sustainability Commitment, New Competitors’
Presence, and Hotel Performance: The Hotel Industry
in Barcelona
Juan Pedro Aznar 1, *, Josep Maria Sayeras 1 , Jorge Galiana 2 and Alba Rocafort 3
1 Economics, Accounting and Finance Department, ESADE Business and Law School, Barcelona 08034, Spain;
josepm.sayeras@esade.edu
2 Accounting Department, EAE Business School, Barcelona 08015, Spain; jgaliana@ub.edu
3 Department Manchester University, Manchester M139PL, UK; albarocafort@gmail.com
* Correspondence: juanpedro.aznar@esade.edu; Tel.: +34-93-280-61-62

Academic Editor: Ian Patterson

Received: 9 May 2016; Accepted: 26 July 2016; Published: 4 August 2016

Abstract: The hospitality industry is facing major challenges, among them the new competition
from novel forms of supply in the sharing economy. Airbnb, Homeaway, and Niumba, among other
websites offering accommodations, are having an important impact in the sector, changing existing
conditions and the market for the traditional hospitality industry. In this context, a strategy based in
differentiation can help to prevent drops in revenues and profitability. The main objective of this paper
is analyse if commitment towards sustainability has a positive impact on financial performance and
can be considered a positive strategy in this new environment. The empirical data refer to a sample of
hotels in Barcelona, one of the most important tourist cities in Europe. Our results suggest that there is
no clear relationship between sustainability and better financial performance; however, sustainability
commitment is associated with a minimum size, which can also have positive effects in terms of
economies of scale and finally affect profitability. Hotels more committed to environmental issues
are located in areas with a lower density of Airbnb apartments, and this geographical distribution
can be more positive than a situation of massive tourist concentration in specific areas with negative
externalities for neighbours.

Keywords: sustainability; hospitality industry; profitability

1. Introduction
The tourism industry is one of the world’s most dynamic industries in terms of growth. According
to the World Tourism Organization (WTO) [1] in 2016, international overnight tourist arrivals reached
a record of 1148 million in 2015, the sixth consecutive year of growth. Tourism represents an important
share of GDP in many countries. In Spain tourism accounts for almost 12% of GDP and international
tourist arrivals have reached more than 60 million in the last year, according to the official statistical
office in Spain (INE) [2]. This increasing number of tourists, however, can generate a variety of
negative externalities in addition to generating economic growth. The phenomenon known as the
Dutch Disease, a concentration of investment in tourism or real estate rather than other activities that
can improve productivity, is one of them; another is the massive concentration of tourists in some areas
with negative effects on neighbouring residents’ quality of life. Impacts on the urban geography or
the depletion of certain unique natural resources are other possible consequences of massive tourism.
Sustainability has become a major concern among scholars; there is a social change related to our
concerns in terms of sustainability, citizens are also acting more frequently regarding consumption
decisions, including how their production or consumption is affecting their environment [3].

Sustainability 2016, 8, 755; doi:10.3390/su8080755 www.mdpi.com/journal/sustainability

Sustainability 2016, 8, 755 2 of 13

The tourism industry includes a wide range of activities but one of the most important in the
package of services a tourist requires is accommodation. Although hotels are still the most important
accommodation supplier, there are new forms of accommodations that are increasing at astonishing
rate. The new supply sourced from the sharing economy or collaborative economy, represented by the
exponential growth of Airbnb, Homeaway, or Niumba, among other similar websites, are changing the
structure of the industry. The sharing economy is a new phenomenon with uncountable consequences.
It is a new form of economic activity affecting the way consumers make their decisions, forcing some
traditional industries to rethink their strategies to survive in an environment where new substitutes
by the sharing economy can affect negatively profitability and finally, governments have to rethink
how to regulate this new form of activity. According to Botsman and Rogers [4] this new form of
economic activity, with clear social implications, need some previous conditions: a minimum critical
mass of participants and a feeling of trust between participants. The sharing economy can be an
alternative to increasing the efficiency of the economic system through the use of spare capacity.
Car-sharing or apartment-sharing are clear examples of how to improve the welfare of participants
through the use of spare capacity. One of the clear effects of the sharing economy is the disruption in
the traditional industry, as Owyang and others authors have pointed out [5] the collaborative economy
empowers customers and, in this context, industries more affected will be the ones with high-cost or
easily-transferrable goods. Hotels are characterized by a cost structure where fixed cost play a major
role and hotels that just offer accommodation and no any additional service can be hugely affected
by apartments accommodation and the new trend among consumers to use collaborative economy
when possible.
According to the official statistics for the city of Barcelona, hotels’ revenues have dropped from
2008 to 2013 even in the context of growing demand. Although from 2008 the world has experienced
one of the most significant economic crises, in the case of Barcelona the drop on national tourism has
been compensated by the increase in demand by international tourists. The years 2008 and 2009 were
when the demand experienced a sharp drop, but from 2010–2016 international tourism has experienced
positive growth year by year reaching, in 2015, a new record with nearly 9 million tourist. From those,
nearly 8 million chose hotels as the accommodation option. Why, in a context of growing demand,
are hotels’ revenues decreasing? One possible explanation is the huge increase in supply from these
new forms of accommodation belonging to the sharing economy. In fact, some scholars have tried
to figure out the impact on hotels’ profitability by an increase in the number of shared apartments.
One of the most important papers in this particular topic is the one from Zervas, Proserpio, and
Byers [6]. To know how important Airbnb’s, and similar websites’, supply in the total accommodation
supply is difficult because the lack of official data. Howeveer, according to some estimations [7] the
total number of beds supplied in Barcelona by Airbnb in 2014 was approximately 50% of the supply of
beds by the hotel sector. The weight of the accommodation supply by the sharing economy in Spain
differs greatly geographically with a high concentration in the most important cities as Barcelona and
Madrid. However, according to the industry [8], the number of beds supplied by Airbnb, Homeaway,
and Niumba is as much as the hotel industry, with Airbnb and Homeaway offering a similar number
of beds and Niumba playing a minor role. These numbers help to give an idea about how important
the collaborative economy or sharing economy in the hospitality industry as a disruptive factor can be.
Firms’ differentiation will become a key strategy in this new environment.
There are many ways in which a firm can differentiate from others; in the hospitality industry,
the customer is acquiring a service with a great impact on his entire experience as a tourist.
As an industry that is providing a service that is mainly an experience, the perception about the
quality of the service will affect the reputation of the firm, the willingness to pay a higher price, and the
loyalty of customers to a particular brand. For these reasons, the academic literature has been focusing
on how to measure quality in the hospitality industry and identifying the explanatory factors of quality
service. Among these factors, the management of human resources [9], the leadership style [10],
and the commitment to sustainability and environmental care [11] are some of the most cited.
Sustainability 2016, 8, 755 3 of 13

The extent to which environmental commitment can positively impact hospitality profitability can
be related to how much customers will be willing to pay for a service that has been provided under
conditions that imply taking responsible action in terms of sustainability. Some authors argue that
what consumers express in terms of how important they consider sustainability is not always followed
up by purchase decisions in the same direction [12].
This paper analyses the possible correlation between financial performance and proactive attitudes
towards sustainability in the hospitality industry. Previous studies have suggested that, in general,
customers have no more willingness to pay just because a product has been produced by a firm
committed to the environment, a situation that implies a gap between intentions, customers more
concerned about the environment, and behaviour [12]. However, some authors have shown through
their empirical work [13] that hotels which follow green practises have a competitive advantage;
customers do not want to pay more but they prefer, ceteris paribus, to go to hotels that clearly
apply green practices. This preference will positively affect occupancy rates and can have a positive
effect on profitability. To measure if a proactive attitude towards sustainability implies better financial
performance is important for scholars, but also for the decisions taken in the industry. The confirmation
of such a relation would suggest that in the long run investing in a more eco-friendly management
is profitable. To find ways to differentiate from the rest of the industry and helping to develop a
competitive advantage, in a sector that is experiencing a huge increase by new forms of supply, is a
topic of growing concern. Massive tourism is related with overconsumption of resources, but also has
some positive and negative effects to residents’ quality of life [14]. Positive effects include the economic
growth or job creation induced by tourism activities. Negative effects are related to overcrowding
some areas and the impact of massive tourist on the daily routines of residents. This paper has also
considered if there is a different geographical pattern distribution of nearby apartments for hotels
more committed to sustainability. A lower density of touristic apartments where sustainable hotels
are located implies that the negative externalities associated to massive tourism are present to a lesser
extent, suggesting a tourist policy that favours hotels more involved in sustainability practices.
The remainder of the paper is structured as follows: Section 2 provides a literature review, and
Section 3 describes the data used and the variables selected to measure financial performance and
sustainability; Section 4 summarizes the main results, and Section 5 discusses the most relevant
conclusions, some of the limitations of this research, and future lines of research.

2. Literature Review
Sustainability has become the focus of attention in recent tourism research [15] for several reasons.
Tourism is a growing industry; the demand for tourism services is increasing as a consequence of a
rising population, a new middle class that demands these services in emerging economies, and the
shift of preferences towards experiences rather than goods [16]. This growth is occurring in the context
of scarce resources, and mass tourism in certain areas can cause resource depletion and compromise
future generations’ welfare [17,18]. The expansion of the hospitality industry in new destinations,
and the infrastructures and other facilities related to the services provided to tourists, completely
changes the urban geography of the main touristic areas [19]. The hospitality industry is a keystone in
tourism services; tourists must have accommodation. Hotel services have an impact on many scarce
resources; water is massively consumed in this sector, as well as chemical products and food [20].
Hall and Gössling [21] analysed the impact of using local food instead of food produced far away with
environmental effects due to the use of transport services.
Many of the most important hotel chains in terms of revenues have included the management of
sustainability in its strategy [15]. Hilton, Intercontinental Hotel Group, and Marriot are some cases of
well-known market participants that have committed themselves to a growth strategy that includes
sustainability, to a certain extent. One of the reasons behind this attitude is the growing interest by
customers on taking into account the effect of their decisions in terms of the effects on environmental
sustainability [22,23]. The growing importance of sustainability from the customer’s point of view can
Sustainability 2016, 8, 755 4 of 13

be see through the increasing number of hotels that provide information about their environmental
commitment on their websites, as well as the existence of a specific eco-friendly hotel category on
some of the most popular booking websites, such as Tripadvisor. In their report about sustainability in
the hospitality industry, however, Ricaurte, Verma, and Withiam [24] note that customers’ behaviour
is not consistent: although in surveys and questionnaires they appear to be increasingly concerned
about sustainability, their purchasing decisions often do not take hotels’ sustainability commitments
into account. Han et al. (2011) [25] analysed consumers’ attitudes about hotels becoming more
environmentally involved using a questionnaire distributed to 422 hotel customers in the US.
They found that the willingness to pay more for a “green” hotel is related to the level of hotel’s
commitment to sustainability. A gender difference was also found, with female customers more
concerned and willing to pay to stay at a green hotel. Prud’homme and Raymond (2013) [26]
conclude that customers’ attitudes towards more responsible environmental practices depend on
how they behave and how important it is in their daily life to take responsible decisions in terms of
caring about the environment. In this context, a social change in how important citizens consider
environmental issues can have a direct effect on sustainability policies adopted by hotels as it becomes
a more important variable in customers’ booking decisions. Based on the analysis of the top 50 hotel
companies’ corporate websites, Hsieh (2012) [27] analysed how much environmental information was
provided; only 46% of them posted information related to environmental issues.
Hotels are more likely to include sustainability in the firm’s strategy if adopting this approach
can have an effect on the development of competitive advantages. This is why academic research has
sought to identify the existence of a relationship between best practices in green hotel management
and better economic performance. Chong and Verma (2013) [28] sought insight in how being an
eco-certified hotel can affect hotel revenues; their main result was that there is no such relationship.
One of the most cited studies analysing the relationship between sustainability policies and
hotels’ economic performance is the empirical work of Claver-Cortés et al. [29]. Hotels located
in Alicante were classified in three categories according to their environmental strategy: proactive,
intermediate, and reactive. Only 14% of the hotels in the sample have some environmental certification.
Their results show no significant difference in economic performance for most of the variables used,
such as occupancy rate or gross operative profit per room and day. A similar study, however,
with a wide geographical scope, hotels in Spain, showed that economic performance was better
among hotels considered proactive [30].
Rodriguez and Cruz (2007) [31] also analysed the relationship between environmental
commitment and hotel performance. The analysis was conducted on 3–5 star Spanish hotels; the
environmental attitude of the hotel managers was measured through a questionnaire, with 114 firms
returning valid responses. With a regression to determine return on assets using the ROA of a previous
period, the hotel size and the type of hotel, including environmental attitude, the explanatory capacity
of the model improved and the environmental attitude resulted a significant variable with a positive
impact on profitability.
One of the main challenges faced by the hospitality industry is the rapid expansion of a new
group of substitutes: apartments offered in what has been called the sharing economy. Apartments
offered by Airbnb and similar webpages are a cheaper alternative to hotels, and the existence of
these alternatives can have a negative effect on prices, occupancy, and profitability in the traditional
hospitality industry. The sharing economy represents a new form of economic activity that can change
the economic system as we understood it today [32]. The concept of collaborative consumption was
firstly developed by authors like Algar [33] and, Bostmand and Rogers [4]. The attitude of consumers
towards these new forms of consumption is, in general, positive, around 70% of U.S. citizens consider
that to share music on internet is positive and should not be forbidden [34]. The implications that the
sharing economy will have in the future exceeds the purpose of this paper. The sharing economy is
a disruption on the traditional industry and the past experiences where industry has fought trying
to stop the growth of new forms has not worked [35]. The most important attempt to figure out how
Sustainability 2016, 8, 755 5 of 13

Airbnb and other similar websites can affect the traditional industry has been the empirical work from
Zervas, Prosepio, and Byers [6]. One of these authors’ conclusions is that the drop in revenues would
be lower for hotels offering a superior category service. We want to add a new variable, that is the
commitment to 8,sustainability,
Sustainability 2016, 755 and see if hotels more committed to sustainability have better financial 5 of 13
and economic performance.
Considering the
Considering the previous
previous literature
literature review
review we
we proposed
proposed aa model
model that
that links
links commitment
commitment to to more
more
sustainability and
sustainability and economic
economic performance.
performance. A A clear
clear policy
policy towards
towards environmental
environmental practices
practices by
by hotels’
hotels’
can help to improve occupancy rates, some authors have found evidence
can help to improve occupancy rates, some authors have found evidence in favour of tourists morein favour of tourists more
willing to go these hotels instead of hotels without that commitment [13]. Customers
willing to go these hotels instead of hotels without that commitment [13]. Customers of hotels that of hotels that
apply green
apply green practices
practices more
more consistently
consistently show
show higher
higher levels
levels ofof satisfaction
satisfaction [26]
[26] that
that can
can positively
positively
affect the hotel reputation. These two elements can constitute the basis of a comparative
affect the hotel reputation. These two elements can constitute the basis of a comparative advantage. advantage.
In the
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actual context
context of of the
the industry,
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disruption of of the
the sharing
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that can
that can bebe afforded
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other cheaper
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alternatives [6].
[6]. Hotels
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more committed
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sustainability cancan
have better
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be less
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experiencing through sharing economy platforms; they offer a product clearly differentiated from just differentiated from
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how
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behaviour affectsaffects the environment.
the environment. TheseThese relations
relations are summarized
are summarized in Figure
in Figure 1. 1.

Figure 1. Sustainability commitment and profitability.

profitability.

Based on
Based on the
the review
review of
of the
the existing
existing literature,
literature, the
the present
present paper
papertests
testsfour
fourhypotheses:
hypotheses:
H1.Hotels
H1. Hotelswith
witha ahigher
highercommitment
commitment
to to sustainability
sustainability have
have better
better valuations
valuations when
when customers
customers rate
rate their experience at the
their experience at the hotel. hotel.
The academic
The academic literature
literature that
that has
has studied
studied how
how sustainability
sustainability affects
affects consumer
consumer behaviour
behaviour is is not
not
conclusive. From the first studies the idea of a gap between intention and action has
conclusive. From the first studies the idea of a gap between intention and action has been present [12]. been present [12].
Chong and
Chong and Verma
Verma (2013)
(2013) [28]
[28] found
found no no evidence
evidence of of aa clear
clear effect
effect onon revenues
revenues when
when aa hotel
hotel become
become
eco-certified, and the previous empirical research has not found evidence of
eco-certified, and the previous empirical research has not found evidence of customers willing tocustomers willing to pay
pay
more for products just because they have been produced by firms more involved
more for products just because they have been produced by firms more involved in green practices. in green practices.
However, some
However, someauthors
authorshave havefound
foundevidence
evidenceofofa apositive
positiveimpact
impact inin customers’
customers’ satisfaction
satisfaction [26]
[26] or or
in
in the willingness to go to hotels committed to sustainability [13]. Today the way potential
the willingness to go to hotels committed to sustainability [13]. Today the way potential customers get customers
get information
information aboutabout hotels
hotels has changed
has changed thanks
thanks to websites
to websites like like Tripadvisor
Tripadvisor or Booking.com,
or Booking.com, wherewhere
past
past customers rate their experience. Our hypothesis is that hotels committed to
customers rate their experience. Our hypothesis is that hotels committed to sustainability rate higher sustainability rate
higher in this past customers experience valuation, which is frequently used
in this past customers experience valuation, which is frequently used as way for future customers to as way for future
customers
reduce theirtolack
reduce their lack ofThe
of information. information. The of
confirmation confirmation
these hypothesisof these hypothesis
will will consequences
have relevant have relevant
consequences for hotels management because can affect their occupancy, revenues, and the value of
an important intangible asset such as reputation.
H2. A minimum size is required to be capable of applying for sustainability certificates.
There are different forms to measure commitment to sustainability; one of them is to get an
Sustainability 2016, 8, 755 6 of 13

for hotels management because can affect their occupancy, revenues, and the value of an important
intangible asset such as reputation.

H2. A minimum size is required to be capable of applying for sustainability certificates.

There are different forms to measure commitment to sustainability; one of them is to get an
external certificate; in our case, ISO 14001. The number of firms that apply for an ISO certificate has
grown consistently in the last decades, with some authors [36] arguing that external certificates related
to quality management improve the firm’s economic performance, but when the decision is made,
the management should be aware of the time it requires and the important amount of resources,
financial and human, that are needed. To get an ISO certificate is a resources consumption process.
When firms are asked about the reason for not implementing these or similar certificates and processes
they argue the lack of information, cost issues, and the lack of resources [37] as the main reasons.
Firms with a minimum size can take advantage of the economies of scales and even find it easier
and cheaper to get the financial and human resources needed to implement these initiatives. In fact,
many empirical studies studying the impact of ISO certifications take size as a control variable.
Fryxell et al. [38] studied the implementation and effects of ISO 14001 for Chinese economies finding
that most of the facilities that implemented the ISO have more than 400 employees, the number
of facilities with more than 1000 employees was almost eight times the number with less than 50.
A minimum size is a factor that will be difficult for small companies to apply for the ISO 14001
certificate. We will test this hypothesis for our sample of Barcelona hotels. If this hypothesis is
accepted, the implication for policy-makers is clear in the sense of developing new ways better adapted
to small firms to certify their commitment to sustainability.

H3. Hotels with a higher commitment to sustainability are more profitable.

This is a controversial topic in the academic literature. There are studies that have found
evidence in favour of such a relation and others that conclude the inexistence of a significant relation.
The studies differ on the variables used to measure profitability and also on the geographical location of
the hotels studied. If we consider the results of Molina-Azorín et al. [30] and Rodriguez and Cruz [31],
commitment to sustainability has a positive impact on the firm performance. Our contribution is to
check this hypothesis for a the hotel industry of Barcelona.

H4. Airbnb is negatively affecting hotels’ financial performance.

This is a topic that just has started to be considered by the academic literature with only a few
attempts, with Zervas, Proserpio, and Byers [6] being the most cited. Our approach is new because we
have considered not just how many apartments are in the city, we have measured if a higher density
of apartments, no further than one kilometre away for each individual hotel, is negatively affecting
the hotel profitability. This is a measure of the effect of the sharing economy in the hotel industry
considering a geographical perspective. The hypothesis to check is if being nearer to suppliers is
affecting the economic results of the firm. In the hospitality industry the location of hotels is one of
the most important decision variables [39]; the distance to the city centre is still a quite significant
variable in deciding where to locate a hotel [40]. Since tourism is a dynamic industry, the places and
the areas tourist want to visit can change, and the supply of new apartments is also dynamic and more
apartments will appear where profitability is expected to be higher. In this context, it is important
to analyse if having a high density of nearby apartments will reduce profitability or, on the contrary,
if the hypothesis is rejected, it is because the high density of nearby apartments is a measure of good
location, a variable that will protect hotels’ profitability.

3. Methodology
To test the hypotheses, a sample of hotels located in Barcelona is used. In 2013, Barcelona
had 365 hotels. The distribution of hotels according to the star category system is as follows:
Sustainability 2016, 8, 755 7 of 13

the low categories, one and two stars, represents 9.32% and 9.86% of the total number of hotels;
the bulk of the industry concentrates in three and four star hotels, with 31.78% and 41.92%, respectively.
Finally, the higher category, five star hotels, represents 7.12%, but it is the one that has grown at a
higher rate. In December 2000 just six hotels were rated with five stars, in December 2013 the number
reached 26 hotels. The supply has grown to meet a growing demand, with 365 hotels in December
2013 compared with 187 just 13 years ago. This rate of growth is consistent with the number of tourists,
for the same period Barcelona has changed from 3.14 million tourists in 2000 to 7.57 million in 2013.
This study samples 54 hotels, or 14.79% of the total population. Most of the hotels considered are four
or five star hotels. Of the sample, 77.77% are four stars hotels, 11.11% have three stars, and 11.11%
are five star hotels. Some of the variables we have considered to characterize the sample of hotels
are: size measured (by total assets), number of employees, net turnover, profitability (measured as
EBIT divided by sales), return on equity (ROE), and level of leverage (total debts divided by assets).
These financial measures have been taken from the 2013 annual accounts registered at Sistema de
Análisis de Balances Ibéricos (SABI) [41], a database for financial information about Spanish firms.
To calculate the importance of the presence of close substitutes, we have considered two different
variables: the number of nearby apartment suppliers within a 1 km radius (measured through Google
Maps) and the number of available apartments on Airbnb, also within a 1 km radius. The average,
maximum, and minimum values for these variables are shown in the Table 1 below.

Table 1. Hotels’ main variables.

Total Number of Google Airbnb

EBIT/Sales ROE Leverage
Assets Employees Apartments Apartments
Average 14,609,629 63.83 3.186% 12.42% 50.41% 50.23 1832
Maximum 39,120,578 316 19.28% 38.38% 96.21% 99 2850
Minimum 1,868,262 12 ´35.67% ´9.48% 7.025% 3 117
Note: Own elaboration using information from SABI.

A higher commitment to environmental management has been measured using a binary

variable. Hotels that were recognized with the ISO 14001, a well-known certificate related to
the environmental practices and policies applied to the firm, has been considered as a variable
that measures environmental commitment. Hotels with the certification are given the value of 1,
and 0 otherwise. We also examined the changes in revenues from 2008–2013. The selection of these
two dates is based in the fact that 2008 was the year when Airbnb was launched and 2013 the final
year for which financial information was available from SABI. This is also a period where the financial
crisis does not look to have had a massive impact, as the drop in national tourism has been more
than compensated by the increase in international tourist arrivals, and the geopolitical instability of
other Mediterranean cities have helped Barcelona that has consolidated its positions as the fourth
city in Europe in terms of international arrivals. The rapid expansion of Airbnb has been a major
challenge for the traditional hospitality sector. In the context of new competition faced by hotels,
differentiation is one of the strategies that can help prevent a drop in revenues and profitability. Hotels
offering a differentiated service will probably be less affected than hotels just offering accommodations.
One of the differentiation options is the commitment to sustainability that can help the hotel attract
customers willing to pay a higher price if they know the hotel is considering the impact of its activity
in the environment. Considering our sample, 38.88% of the hotels have the environmental certification
ISO 14001. The change in revenues for the period from 2008–2013 was ´9.7%. Most of the hotels saw a
significant drop in their revenues, and 77.77% of the hotels have revenues in 2013 below their 2008
levels. If there is a relationship between environmental commitment and major quality in the service
provided, this major quality should be registered in the opinions guests express about the hotels and
their experiences. To measure guests’ opinions, the average marks for each hotel on Tripadvisor [42],
one of the most popular websites for hotel information, according to data from 2 February 2016,
has been collected.
Sustainability 2016, 8, 755 8 of 13

To test whether variables are normally distributed, the Shapiro-Wilks and the Kolmogorov-Smirnov
tests were applied with similar results. With the exception of return on equity (ROE), no single
variable considered follows a normal distribution. This condition affects the selection of the test
that will check our hypotheses. The two tests that have been applied are the Mann-Whitney test,
to verify if the difference in average for TripAdvisor valuation, the drop in revenues (2008–2013) and
the profitability (measured by the ROE) are different for hotels with the ISO 14001 and those without it.
We also test the correlation between the same variables and having the ISO 14001 certificate, for which
we use Spearman’s Rho correlation based on the lack of normality. The TripAdvisor value for each
hotel is the percent of opinions that rate the hotel above a 4f in a ranking system from 1–5. A value of
85 indicates that 85% of the customers who evaluated the hotel scored it 4 or above.

4. Results
Hypothesis 1 relates to the existence of a relationship between environmental commitment,
considering that hotels with ISO 14001 certificates are committed to sustainability, and guest opinions,
measured using the average values at Tripadvisor. Hotels without the ISO certificate have a higher
average valuation at Tripadvisor, with an average value of 87.41, whereas hotels in the sample with
the ISO certificate have an average value of 81.33. The difference is significant at the 10% level but
not at the 5% level. To confirm that the relationship is negative, we calculated the Spearman Rho
coefficient and found it to be ´0.489 and significant at the 5% level (correlation between the Tripadvisor
valuation and having the ISO 14001). This result implies that, from customers’ points of view, hotels
committed to sustainability have no better results, probably because, as some authors have pointed out
(Baber et al.) [12] customers express that sustainability is important but they do not take this as a
relevant variable when deciding their consumer behaviour, in deciding how to valuate hotels other
factors are becoming key in defining the final valuation. In fact, the most important websites in terms
of visitors to get information about hotels, Tripadvisor or Booking com, ask about service quality,
cleaning, or hotel location; but there is no specific item for the eco-friendly attitude of the hotel.
Hypothesis 2 is related to whether there is a minimum necessary size to be able to manage the
administrative process and all of the costs involved with an environmental certificate, here ISO 14001.
We found that there is a positive correlation between size and having the certificate: the Spearman Rho
coefficient is 0.538 and significant at the 5% level. Size was measured using the total assets according
to the 2013 balance sheet.
The third hypothesis seeks evidence of a positive relationship between responsible environmental
management and profitability measured using the return on equity (ROE). Hotels with the certificate
have an average profitability that is slightly higher than that of hotels without the ISO, 10.58%
versus 8.96%, respectively. According to the Mann-Whitney U test, the difference is not statistically
significant. The Spearman Rho correlation is also not significant. These values imply that further
research is needed, probably increasing the geographical scope of the sample, to find definitive
evidence, statistically significant, in terms of a positive relation between commitment to sustainability
and economic performance.
The fourth hypothesis concerns the existence of a negative effect of new forms of supply through
the sharing economy on hotel profitability. There is no statistically significant correlation between
the number of apartment suppliers (using information from Google Maps) or Airbnb apartments
and profitability, measuring profitability through change in revenues from 2008 to 2013 or the ROE.
Although Airbnb, Homeaway, and Niumba have changed the industry framework in terms of location,
hotels with a high density of Airbnb apartments are usually located near to the touristic city attractions
or main interest points, and customers are willing to pay for being near to what they want to visit, so
hotels with a good location are less affected by the pressure of new forms of supply.
The results of these tests are summarized in Tables 2 and 3.
Sustainability 2016, 8, 755 9 of 13

Table 2. Test results.

Subsample with Subsample without Is the Difference

ISO 14001 Certificate ISO 14001 Certificate Significant?
Tripadvisor valuation 81.33 87.41 Yes
Revenue difference (2008–2013) ´9.33% ´9.58% No
Return on equity (2013) 10.58% 8.96% No
Note: Own elaboration.

Table 3. Spearman’s Rho correlation.

Correlation Coefficient Level of Significance

Tripadvisor and ISO 14001 ´0.489 5% level
Size and ISO 14001 0.538 5% level
Google apartments and change in revenues 0.41 Not significant
Google apartments and ROE 0.276 Not significant
ROE and ISO 14001 0.10 Not significant
Note: Own elaboration.

These findings are similar with others previously obtained and discussed in published empirical
research [24–26]. There is no evidence of a relationship between better financial performance and
environmentally-oriented management. There is a growing concern among customers surrounding
environmental responsibility but, although this process has already started, the effects on hotel
profitability remain unclear.
To check if the characteristics of hotels committed to sustainability are different to the ones without
such a commitment, we compared the average values for most of the variables included in our study
using the Mann-Whitney U test is not significant for the variables analysed. Although the average
values are different from a statistical point of view, the difference is not significant; however, the
differences observed are interesting. Hotels with ISO 14001 certificates are larger in size, considering
the number of workers or total assets; they have higher gross profit in terms of sales, a variable that is
used to measure efficiency in the operations performed by the firm, and the ROE is higher than for
hotels without the certificate. In terms of competence and pressure from the supply of accommodation
provided by the sharing economy that has been measured by number of Airbnb apartments within
a 1 km radius, hotels with the ISO 14001 experience lower pressure. Airbnb apartments are highly
concentrated in the more tourist-heavy areas, with some negative externalities for the neighbours
living in these areas. The environmentally-responsible hotels are less geographically concentrated in
these areas, with positive effects in terms of economic activity, but less pressure on ordinary life for
citizens of Barcelona. These data are summarized in Table 4.

Table 4. Differences in the sample.

Hotels with ISO 14001 Hotels without ISO 14001

Number of workers 109.8 52.85
Total assets 27,164,673€ 9,953,639€
Airbnb presence 1304 2064
Gross Profit as a % of sales 8% 4.89%
Note: Own elaboration.

5. Conclusions
This paper has reached similar conclusions to other studies regarding the lack of evidence
concerning the relationship between financial performance and commitment to sustainability [24,25].
The geographical scope and size of the sample do comprise limitations, so additional empirical studies,
Sustainability 2016, 8, 755 10 of 13

increasing the size of the sample and considering more than one touristic city, are needed to support
the results found in this work.
The first hypothesis related to hotels meeting ISO 14001 having a higher customer valuation,
by past customers that rate them at Tripadvisor, than hotels without the certificate has been rejected.
Hotels with the environmental certificate have a lower average valuation by customers; this result
implies that hotels committed to sustainability maybe have to rethink how they communicate this
commitment to their customers. The effort they make in considering the impact of their activity
on sustainability is not translated in higher valuation by customers that can result in higher prices,
loyalty, a higher demand that improves occupancy, or more value for the intangible that represents
reputation. This result is similar to those form previous research [12]. Using an experiment to measure
the willingness to pay, they found that there is no a positive difference in favour of environmental
products. The difference between the opinions expressed by customers in favour of sustainability
and the lack of a proactive attitude is known as the action-gap, and our results reinforce its existence.
If consumers are not willing to pay more for environmentally-managed hotels, the differentiation
based on this element will not produce better financial results. Some previous results have shown
a relation between customers’ satisfaction and commitment to green practices [26] or customers’
preference for sustainable hotels [13]. Our results do not support this idea, and it can be explained
because the overall valuation by customers included many other things rather than just commitment
to green practices, from room cleanliness to the quality-price binomial. More research is needed
to assess to what extent commitment to green practices affects consumer behaviour, without other
possible factors affecting the overall customers’ valuation. One last option is related to how we
have measured environmental commitment, i.e., through online reviews posted to the most visited
and popular websites for finding hotels’ information. Meeting ISO 14001 is probably less important
than what environmentally responsible consumers are writing about the hotels they have stayed in.
An interesting future line of research can be to focus on how, in this new technological era, customers
find information about hotels, how they make their purchase decisions, and what aspects are really
relevant in making the decision. Are there other ways in which a hotel can communicate more
efficiently their commitment to sustainability rather than an ISO certificate, and having a real effect on
the consumer behaviour?
Our second hypothesis has been accepted. Hotels require a minimum size to apply for ISO 14001;
this finding is consistent with the existence of the administrative and operational costs necessary
to earn the certificate. To get an ISO certificate is a long process that requires defining many of
the operations performed and to reach this state financial, and also human, resources are needed.
Small hotels do not meet the resources or the capacity to enlarge them to fit these new needs.
Regarding our third hypothesis, neither the return on equity nor the drop in revenues show
a better performance, with statistical significance, for the subsample of hotels with ISO 14001
certification. The percentage of hotels with the certificate is low, which can be explained by the
lack of an immediate effect of the certificate on revenue. Using data from 3000 eco-friendly hotels,
Chong and Verma (2013) [28] found no evidence of impact on revenues. However, hotels with
ISO 14001 have a higher average ROE, though not statistically significant, and the use of a higher sample
including more cities and more control variables could help to solve the debate about sustainability
and better results. Additionally, it is important to consider that profitability is affected by many
other variables; internal variables, like the level of leverage or the location, have been confirmed by
many studies [43] as explanatory factors for profitability.
Our fourth hypothesis was the effect of Airbnb on hotels’ profitability, but taking a geographical
perspective. Instead of looking to the data sector, we checked the number of apartments advertised on
Airbnb near to each hotel. The correlation between apartment density and return on equity or change
in revenues was, in both cases, positive, but not significant. The supply of Airbnb and other similar
websites would probably grow in the most attractive areas for customers’, near to the city centre or
where tourists want to visit. Density of apartment supply near to hotels could be used as a measure of
Sustainability 2016, 8, 755 11 of 13

how attractive a location is. On the other hand, some issues arise from a policy perspective; a model
of high concentration and agglomeration of supply have clear negative effects on the quality of life
of residents.
Some results do encourage future studies. Hotels with a greater environmental commitment
are located in areas with less tourism pressure. In our sample the number of Airbnb apartments
is lower on average for this category of hotels. This could be an important factor in terms of the
overall effect of their activity. These hotels contribute to economic growth but in a more sustainable
way, reducing the negative effects associated with a massive concentration of tourists in a particular
area. On the other hand, although more data are needed to validate these results, hotels with the ISO
certificate have a higher ROE and higher gross profits, on average. Previous analyses of profitability
and environmental commitment have not shown clear results as the literature review summarises. The
further confirmation of the hypothesis of a positive effect of sustainability on profitability is important
because, in the actual context of new supply from the sharing economy, building a mechanism
that reinforces profitability is critical for the traditional hospitality sector. Academic literature that
has analysed economic performance has used many different variables from return on investment
(ROE and ROA) to gross profit per room, and revenue per available room, among others. The results
achieved depend on the indicators selected [6,11,26–30]. Future studies should take a wide range of
variables but they should also make an effort in understanding the mechanism that explain how more
commitment to sustainability is affecting the firm, in many various aspects, from the process of making
decision, to the excellence in the service provided, and to what is really relevant: how this affects the
customers’ perception.
Sustainable hotels make a positive contribution in terms of economic growth, employment,
and other positive effects related to the hospitality industry. The fact that these hotels exhibit more
responsible consumption of production factors, and as our results suggest, that they are located in
areas with lower tourism concentration, means that the negative externalities associated with their
activity are reduced by this specific type of hotel. A suggestion for future research could be to analyse
the effects of tourism comparing different geographical models, cities where tourism is massively
concentred in some areas against others that have made an effort in a more equal distribution of rooms’
supply from a geographical perspective. This conclusion opens the door for a more proactive industrial
policy towards reinforcing the supply of eco-friendly hotels.
There are several future lines of research that could provide deep insight into sustainability
and the hospitality industry. For example, it is important to analyse the relationship between
sustainability-oriented management and other desirable characteristics that can help hotels provide
better service in terms of quality, such as more service-oriented management to provide support,
the right leadership for human resources, or the capacity to innovate and remain flexible under
constantly changing market conditions. A second line of research could be to analyse the many
different ways in which greater commitment to the environment can be measured, and finally,
an exploration of what makes consumers take into account environmental sustainability factors
into their travel decisions.
The possibility that commitment to sustainability can provide firms that apply this strategy with
better financial performance in a new environment of more competitive pressure from near substitutes
implies that a strategy with positive social effects, in terms of reducing the negative externalities,
can also have a positive impact from the owners’ perspective. The confirmation that a minimum
size is needed to apply for these environmental certificates implies the need to rethink the policies
promoting and helping medium and small firms. Finally, for the past decade, as the WTO [1] points
out, tourism activity is increasing, but with a high concentration in some areas, with positive effects in
terms of economic activity, but causing pressure in the use of some resources that thinking from an
intergenerational perspective must be considered when tourism activity is regulated.
Sustainability 2016, 8, 755 12 of 13

Acknowledgments: The authors want to thank Llorenç Bagur-Femenías for his comments on a previous version
of this paper. We also want to thank Leandro Urbano, Inés Losada and Xavier Camarasa for their valuable help as
research assistants.
Author Contributions: Galiana was responsible for the revision of the literature review. Alba Rocafort was
responsible for performing the statistical tests. Aznar and Sayeras worked together in the analysis of the results
and on writing the final version of the paper.
Conflicts of Interest: The authors declare no conflicts of interest.

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