GSAIR 2025 | Page 30

Costs vs. Sustainability

There are mixed views about whether travel budgets will rise, fall or stay the same over the coming 12-18 months. Whilst 58 % of travel managers expect their budgets to increase in 2025, reflecting rising demand for face-to-face interactions, 20 27 % expect them to fall by a fifth. 21

The gap between cost and sustainability in terms of priorities has widened in the last 12 months against a backdrop of wider geopolitical and geoeconomic uncertainty. But although 78 % of travel buyers cite cost control as one of their biggest strategic priorities in 2025. 22 this doesn’ t mean sustainability is no longer a corporate priority, however.

As Karen Hutchings says,“ it’ s been a while since cost savings has been at the top. Sustainability has been up there, but cost is what they’ re focused on. Employers are restricting the number of trips, but you’ ve still got carbon emission reduction targets to meet, although the prioritisation of that has dropped significantly, especially in the U. S.”

In 2024, 61 % of European travel buyers still considered sustainability a high priority, with 44 % of travel managers globally having integrated sustainability initiatives into their programmes. 23 In 2025, 42 % of operators consider their ESG credentials“ very important” in driving demand. Regardless of where sustainability now ranks in corporate priorities, 42.3 % of serviced apartment operators consider their ESG credentials to be‘ very’ to‘ extremely’ important in driving customer demand. 24

In general, more corporates are aiming to strike a balance between cost and user experience than previously. For some, this means using AI-powered tools to streamline travel programmes, making smart recommendations and real-time cost optimisation while considering sustainability. Others are expanding travel content and improving collaboration to enhance the traveller experience while managing costs and sustainability. 25

Whilst sustainability may not be travel managers’ top priority, it remains a hot topic in the public sector and others such as manufacturing and pharmaceuticals, especially for capital projects and consultancy. However, the importance attached can depend on the sector in which it operates. Those with higher regulatory pressures and environmental impacts tend to integrate ESG considerations more extensively into their operations. 26

In some cases, travel-related emissions might only be a small proportion of the organisation’ s overall emissions, in which

case sustainability can be de-prioritised behind, for example,

Demand risk management summary.

Dynamic Danny working Cockton shift is continues VP – Global Travel Services at Wood Plc, The shift a global towards consultants remote and, engineers hybrid work, and continues project delivery firm. to influence“ Travel global is a small mobility portion trends of our in 2025 emissions. Despite. A lot of the work organisations we’ re doing like PwC in the enforcing energy sector three days is around a week decarbonising

in the office, customer with attendance assets and dashboards19 that impact, and outweighs Transport our for London travel( Tfl) demanding emissions.” at least 50 % in-office attendance, 28 % of UK workers are hybrid. 20 This illustrates the pushpull between“ Today flexibility we capture and emissions in-office data presence for our that air mobility travel and teams must ground plan transportation around., it’ s not yet influencing travel or The rise accommodation of dynamic working decisions has boosted at the point long-stay of sale bookings, although from domestic that’ s our and objective international over the mobile next professionals

12 to 24 months.” seeking work-ready units. Serviced apartments provide the flexibility“ At required the end of to the support day, BP for is hybrid an oil work & gas and company duty-ofcare compliance Richard Eades..“ Whilst we’ re looking at scope one and two,

” says

Carol Fergus we don is’ t Director spend too, Global much Travel time, looking Events at and scope Ground three. With Transportation the help at of Fidelity the rich International data we receive.“ Since from Covid SilverDoor, people, we’ re have been looking using at serviced our footprint apartments in the apartments more due to that dynamic we’ re booking, working and and benchmarking a desire for a against better work-life hotels.” balance. They’ re going for that option because more of their peers are working In from global home mobility and, they companies want that are option adopting to stay sustainable

a serviced practices apartment such as as opposed reducing to trip a hotel frequency room.”, offering incentives Demand for is eco-friendly strong. In 2024 travel, servicedapartment options, and replacing RevPAR pre-assignment

was 27.5 % higher visits with than virtual the hotel tours average. These between initiatives 2021 are more and 2023 prevalent, indicating sectors strong where corporate employee demand relocation for long-stay is frequent options, such. 9 as Having technology increased by and 3.8 consulting % between. 27 2023-24, occupancy is predicted to rise again in the next twelve months, although this may Graebel tempered VP Client by Services a softening EMEA of ADR & APAC in London Seb Hutchings. 10 says that, whilst sustainability is important,“ it tends to rank Does the fourth picture or fifth painted terms here of match strategic up with priorities serviced. Our clients apartment are genuinely operators interested’ experiences in exploring? Supercity sustainable Apartments options, is a boutique but this operator interest, hasn with’ properties t yet translated in London into changes, Brighton in, policy and Manchester entitlements.“ We.” are seeing an increase in bookings, and length of stay from September onwards to the end of the year,” says“ Some Carley organisations Bannaghan may. encourage economy-class travel to reduce carbon emissions compared to business or premium Trine Oestergaard economy. However Stafford, from is MD a of global House mobility of Fisher programme

, a familyrun company perspective which, there owns is and no operates formal emissions serviced thresholds apartments being and aparthotels enforced. in Ultimately the South, it of remains England a and matter Thames of customer Valley. preference- sustainability is viewed as a desirable,“ Overall rather, our length than a of mandated stay has requirement gone up year-on-year.”. We are seeing more project work, and more group bookings which we never There had is before, however. We,’ re a growing also seeing realisation low business of the in importance the of winter social months engagement and high in. the UK summer companies months are increasingly. The market leveraging is also incredibly HR platforms competitive and AI-driven, which is analytics pushing to rates measure down and, so manage we’ re finding social metrics it hard to such increase diversity our ADR, pay, particularly equity, employee in those downturn sentiment months,.” and volunteer participation, in real time. 28