29 June 2017

Code for Good Governance in Tourism

Hereunder we shall analyse the Code for Good Governance in Tourism.

It may be true that we had never thought that this code was a fundamental and necessary part of the tourism package, but it is, as much as the sunscreen which prevents us from getting skin cancer in the long term if we are overly keen on sunbathing.

It has taken us a great deal of experience and the declaration of 2017 as the Year of Sustainable Tourism in order to understand its importance, although there are still some people who do not wish to recognise it.

As you know, sustainable tourist activities are not only those which can be measured by the short-term financial profitability of shareholders or the financial resources that enter the coffers of public authorities through taxes, fees, etc., but also those which, in addition, measure the effects of their impact on the labour, environmental, social and good governance fields, both in private enterprise and in the administrative territory in which such activity is performed.

It is true that. on certain occasions, there are urgent deadlines which might lead to certain business decisions being taken which do not contemplate long-term profitability, but in general, this situation has not been the reality of either public or private institutions which have been carrying out tourist activities in the last years. Therefore, why do we insist on killing the cash cow?

The success of tourist activities cannot be measured by short-term profitability, but by their long-term sustainability. The more years a population or territory has jobs and businesses attracting visitors, the greater the success.

What is better for a town, for the business located there and for its inhabitants? Is it attracting low-quality mass tourism with the prejudices this has for the environment, the quality of life of the inhabitants of the town and with the risk of degrading the territory? Or is it attracting high-quality tourism, with fewer visitors but with higher profitability? We are fortunate… or unfortunate that our beaches and our landscapes are so rich that the first option presented is very easy to achieve; in contrast, the second needs a bit more hard work. We need to remove the tourism based solely on heavy drinking or sun and sand from our options. Tourism has matured, and for some time its objective has been been change.  

The management of change has to be introduced into the business strategy, and if we align this with the social responsibility of the institution or territory, by affecting the values and attitudes of corporations and citizens, long-term success will be secured. To do this, it is necessary to be aware of the impact of tourism:

Economic impact: resulting from the economic and financial management of the activity.

Labour impact: the result of models of hiring and human resource management.

Environmental impact: pollution, destruction of scenery, excessive consumption of natural resources, etc.

Social impact: direct effects on the culture of the hosting community and on the groups related to it: tourists, local population, public institutions, service providers, etc. 

Each one of these impacts has to be managed, both by the tour operators, in all their dimensions, and by the public bodies.

The implementation of a Code of Good Governance, both in enterprises and in Town Halls, Consortiums, Regional Governments, etc., will help to enhance the positive impacts and mitigate those which are not so. The Code includes the principles and rules for the operations of institutions, and its main objective is transparency, which will involve the issuance of an annual report in which the Management will include all the relevant data, both positive and negative, influencing its interest groups, deriving from its activity and where all those data regarding the sustainability of the institution and activity are related. The report issued throughout the years will reflect the progress of the impact generated and the achievement of the targets established in order to enhance or mitigate the results obtained, whether positive or negative.

M. Eugènia Bailach, Audit Partner, Member of the Auren Tourism Commission, Spain         



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