What is ESG, and why is it important for your meeting strategy?

Environmental, Social, and Governance (ESG) standards are becoming increasingly important in the modern business world. These three areas of focus for companies are vital considerations for organizations looking to run more sustainable, ethical events and meetings and will only become more crucial in the coming years.

Environmental, social, and governance (ESG) is a term used to represent an organization’s corporate financial interests, focusing mainly on sustainable and ethical impacts. It is a must for large Fortune 500 and Fortune 1000 organizations whose stakeholders are demanding they align with these standards. Organizations already aware of these standards will find it easier to interact as a partner by focusing more on sustainability and diversity, which is especially relevant in meetings and events.

Let’s find out why.

Environmental standards for corporate events and meetings

Since the global pandemic, more and more organizations have turned to virtual and hybrid events to mitigate their meetings’ environmental impact. Switching to virtual events helps eradicate the carbon footprint of traveling to and from the venue and removes the effects of printing paper resources, onsite meals, and buying and transporting meeting supplies.

However, as travel restrictions have eased, organizations have started revisiting in-person events through a more sustainable lens. Using QR codes linked to online resources and choosing more sustainable venues with good public transport links are just the beginning. Opting for hotels that source locally can also help reduce the environmental impact of food and beverage at events. Asking the question of your venue, “What are your strategies for sustainability?” and ensuring they adhere to your goals will help decrease your meeting’s environmental impact.

Social considerations for the corporate meeting & events industry

Social considerations are an important, often-overlooked aspect of ESG. Organizations prioritizing ESG are now thinking more about the diversity of their workforce, supply chain, and partners. This could include championing marginalized communities, increasing the number of women-owned businesses in the supply chain, or working with people of color as ambassadors.

Social-oriented policies go beyond observing International Women’s Day, Pride, or the Black Lives Matter movement; it’s about embedding diversity at the organization’s heart. At AMI, we truly believe in social diversity and work to strengthen our inclusive supplier chain with every event.

Governance for event businesses prioritizing ESG

Diversity matters at every level of the organization – including the governance team. A diverse range of viewpoints supports inclusion throughout the organization, ensuring that more voices are heard. Many businesses are looking to partner with organizations with diverse governance, including gender, sexuality, race, religion, and more.

It’s also about having ethical policies in place to ensure that the entire organization upholds the ethical standards at the core of the business. This helps reassure customers that their event partners work to the same ethical standards for producing meetings and events for their audience.

Why ESG matters in the corporate events industry

At AMI, we’ve found that more and more clients are requesting ESG policies and want to know how these topics are being considered and acted upon by their events partners. If an organization is looking to produce greener, more sustainable, more diverse events, working with an events partner with a strong ESG stance will help them ensure they get it right.

The world, in general, cares more about looking after the environment, supporting diverse communities, and partnering with businesses that share their ethics, which is why having clear ESG policies in place matters. Organizations are more conscious than ever before of reducing their carbon footprint, reducing waste, and being more inclusive. Those in the events industry who can prove that they live and breathe ESG will stand out.

The good news: business travel is back! The less good news: the cost of business travel is skyrocketing.

The highest per diem corporate travel cost increases from 2020 to 2021 are 41.48% in Fort Lauderdale, FL, 33.8% in New Orleans, LA, and 33.44% in New York, NY. New York City unsurprisingly is the most expensive city for business travelers, with an average cost per diem of $540.74.

Before the pandemic, business travel was one of the top 5 highest expenses for organizations. Following the pandemic, there are new economic, social and geopolitical drivers pushing up the cost of corporate travel. The cost of gas is increasing, and airlines are inflating prices to recuperate some of the losses from the last two years. While corporate travel isn’t expected to return to pre-pandemic levels until 2024, organizations are a lot savvier about spending their travel budgets.

But that doesn’t mean that you have to stop corporate travel entirely. There are many reasons to keep global travel on the agenda, from long-overdue reunions with valued business contacts to in-person conferences and events to training workshops.

So, how can you budget smarter to mitigate the rising cost of business travel?

Compare flight and meeting calendars

Unfortunately, the myth about Tuesdays being the cheapest day to book flights has been debunked. But it can certainly help you secure more affordable business travel if you take the right approach. If you know you need to travel for business and have some flexibility around dates, take a look at the flight prices before making a firm decision. Traveling into New York on a Wednesday afternoon instead of a Monday morning is likely to produce very different prices, so plan corporate travel around the flight costs to avoid being stuck paying well over the value.

Rethink your transport options

62% of people who will travel for work in the next three months will take their personal vehicle, 46% intend to fly, and 25% will rent a car.

Consider alternative accommodations

Unless you have a fantastic deal with a hotel chain that gets you their best business rates, it may be time to reconsider how you handle accommodations. Hotel rates are expected to increase by 13% globally in 2022, so why not consider renting an Airbnb or Vrbo for your employees instead of a hotel? This may be cheaper, especially for midweek business travel, and you may be able to find somewhere closer to where they need to be, saving on additional travel costs during the trip.

Opting for a private accommodation booking may enable you to select a more cost-effective meeting venue. Avoiding the expensive hotels in tourist hotspots gives you more flexibility around the location of your event, so you may choose to opt for a less expensive neighborhood to keep costs down.

Send your local coworkers

This won’t always work, but sometimes it may pay off to send your local coworkers to handle meetings and events in their area. For instance, if you have a globally distributed marketing team looking to attend a conference in London, it makes sense only to send your UK coworkers rather than flying your US team halfway around the world to join them.

This may seem obvious, but most organizations would be surprised to see how much money they have spent over the years on sending employees further than they need to for corporate travel. In fact, this Corporate Travel Index Calculator from Business Travel News will help you figure out how your corporate travel costs measure up.

Analyze your travel spending trends

It’s a fact that some teams (such as sales and marketing) will spend more on travel, but do you know exactly how much they are spending? Working closely with your accounting team will give you an insight into how your travel budget is being spent and where there might be opportunities to cut back.

For instance, are business class flights necessary for domestic trips, or would economy suffice? Are there lots of lavish meals happening on business trips? Are certain employees spending significantly more than expected on Ubers when hiring a car would be cheaper? Taking the time to analyze your corporate travel spending will empower you to make smarter decisions.

Opt for hybrid events

While some corporate travel is inevitable, there are likely times you can save on the cost of business travel by simply not traveling.

Hybrid events are becoming increasingly popular as they strike a balance between maintaining face-to-face connections and real-life interactions and a more cost-effective, sustainable approach to meetings and events. Instead of sending your entire team, business class, on a long-haul flight, why not choose a couple of key contacts, and have everyone else dial into the meeting virtually

There are plenty of hybrid meeting tools to engage both in-person and virtual attendees, and when done right, a hybrid event can deliver even more impact than an entirely face-to-face event. For example, your busy senior colleagues may not be able to fly to another city for a three-day event, but they can dial in when needed, which benefits everyone.

On a recent podcast, “The Future of Tourism”, American Meetings, Inc. CEO Andy McNeill shares his expertise and forward view of tourism as it relates to the MICE Industry (Meetings, Incentives, Conferences, and Exhibitions), a corporate events industry that heavily relies on travel and venues to thrive. Over the past 18 months, both industries have faced huge obstacles that threatened their existence.

The following article is a Q&A derived from the podcast.

The corporate events industry has been slammed by travel and gathering restrictions, but the need for meetings hasn’t gone away. In 2020, nearly $1.4 trillion dollars in international business travel spend disappeared resulting from travel restrictions. And, with today’s continued uncertainty, it’s been predicted that it will take five years or more to recover. Bill Gates believes that it will never fully bounce back and estimates only 50% of business travel will return.

With this in mind, we look at the future of tourism and the corporate events industry.

Q: What did 2020 look like for AMI (American Meetings, Inc.)?

A: It started really well. We were on an economic high with everyone making money and growing. I was at a conference in New York City when I first heard the word “COVID.”  Our target market is Fortune 500 companies, which tend to be risk-averse, so we knew we had to make a quick change. We were lucky that we had been supporting virtual platforms with a few of our clients. While it took a few months, we were able to transition to all virtual events, all the while not knowing when live events would come back. This was when hybrid meetings were born.

Q: When did it hit you that everything going forward was going to change in the event industry?

A: I was on a strategy call with one of our bigger clients when we received a call from their travel officer, who informed us that these critical employees were restricted from traveling. We knew at that moment we had to adjust and get ready for a new way of doing business. It was critical that these people meet, and we knew we had to support that any way we could.

Q: What was the hardest part of making this shift?

A: Our biggest challenge was trying to figure out which software to support quickly. There were so many options and in the past, we would offer solutions to the IT department of the company hosting the virtual event and let them pick. This time we had to choose a few that matched the greatest needs of our clients while also providing the compliance, security, and bells and whistles they required. We had to pick a few and stick with them. We made the investment, and it paid off. We started 20 years ago as a live meeting organization, and now we are supporting meetings through technology. We always knew technology would be part of the mix, but it’s bigger now and here to stay.

Q: What do you see as the biggest benefit of hybrid events?

A: Our society is changing, and sustainability is more important than ever. Reducing the carbon footprint of travel has been on people’s minds, and this is going to continue. Large corporations often take on sustainability efforts, but they don’t know how to really make events feasible in the hybrid format. Now, they have seen that they can save money by reducing travel and accommodation costs and still have a successful event.

We all know live events are important because we are social beings and some components still really need to be done face-to-face. But, people are still unsure about meeting in large crowds, and venues are uncertain about ever-changing restrictions and regulations. This has created a strong case for hybrid events.

Q: What do events of the future look like?

A: Interaction tools. Avatars. AI. We are always looking for ways to enhance the experience for all guests, whether live or virtual, and these tools help create a one-world model that brings everyone together.

Technology exists that allows the speaker, who isn’t anywhere near the participants, to be seen and interacted with including receiving eye contact as though it is face-to-face. The price still needs to come down on some of this technology to make it more accessible, but there are existing solutions that bring in 3D holograms or similar into a space to make it seem like we are all in the same space, even though we are half-a-world apart. It’s time for organizations to develop content with AI in mind and build it into their programs.

Q: What else are you seeing in the industry that is a benefit?

A: Data. We’ve been spending time educating our clients about the data and reporting that is available. This information now comes in real-time, so being able to digest it quickly and make changes to support the attendee experience is an amazing skill and benefit. In the live environment, we could take polls and look at the information later, but now, we can see exactly who is engaging with content and when we are losing the audience and immediately adjust.

Q: With all this virtual and AI, what are destinations to do?

A:  The destination is an initial factor in what the attendee experience will look like. Before we talk about break-out rooms, we decide what venue will be the best host. Generating a memorable experience is what matters, regardless of the type of meeting. A board meeting on a golf course, an incentive trip with the family, a sales conference on the beach—they all allow the attendee to have time away from their usual day-to-day and smell the smells, see the sights, and taste the foods where they are visiting.

Today we are looking for ways to expand the experience for both virtual and live guests. Destinations that embrace this and take it to the next level will be successful. Travel still matters and if a virtual attendee has a great experience, they may feel more comfortable taking a trip to the venue in the future. People still love to visit new places, so do what you can to improve your brand in their minds, whether virtual or live.

Q: What have you learned?

A: I’ve learned that no two meetings are alike and there is a lot of training going on. There is a learning curve for new virtual technology, even for those who think they are tech-savvy. Give it time.

Overall, it’s been a rough year, but stick to it, it’s going to get better.

Listen to the expert guest interview of Andy McNeill, CEO of American Meetings, Inc. on the “Future of Tourism Podcast”. Listen now.