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Circular Economy – a future trend in hospitality?

It is high time the hospitality industry, along with the rest of the travel and tourism industry, starts to think about innovative ways to embrace the economy of the future with transformative business models and novel ways to consume products, services and experiences.

Published : 19.12.2019

Resources are becoming scarcer and more expensive. Overconsumption and the reckless use of resources have to end. Circular Economy may provide an answer to the dilemma. In Circular Economy resources are used as long as possible with as much value as possible. Products and raw materials are reused, recycled, redesigned, upcycled… endlessly. There is no waste in Circular Economy. At the moment, less than 10 % of the world economy is circular. It is about to change soon.

Circular Economy is still mostly associated with manufacturing and forestry. In hospitality, there are positive signs out there already, even if as a service industry, it has been focusing more on distribution channels and occupancy rates than on what is happening in its supply chains. Major Nordic and Finnish hotel chains are all taking steps towards circularity, or at least so they say. They have all done attempts towards circularity, e.g. in form of waste reductions, renewable energy initiatives, replacing single use items and reusing containers, ending the use of unnecessary plastics, purchasing guidelines, reuse of textiles by other companies and recycling furniture.

Nordic actions towards circularity in hospitality

Nordic Choice Hotels, spearheaded by its philanthropic high-flying owner, the saviour of Tjäreborg, Petter A. Stordalen, is the most ambitious one: The hotel company’s website states that “The hotels will introduce circular thinking at all levels, increase the possibilities for recycling, train staff in environmental awareness, and purchase products that can be recycled.” Its competitors, Scandic and Sokos, are more humble in their affairs. Scandic offers principles for the Circular Economy in its guidelines for sustainable procurement. With Finnish pragmatism, Sokos Hotels informs about its concrete circular actions, like recycling textiles in a circular fashion.

Stronger together

According to what hotel chains communicate about Circular Economy it seems like they see it as something rather close to sustainable thinking. Most definitions of Circular Economy also stress innovation and new business models as a result of circular thinking. Here it seems like hospitality has some work to do. As Håkansson and Snehota stated already in 1989 in their seminal article about business networks: “No business is an island.” To make the most out of Circular Economy in any industry, a network or supply chain thinking is needed. It is not enough that, for example, a hotel reduces its waste by renting textiles, such as sheets, instead of buying them, without negotiating with the leasing company about what is happening to the textiles once they reach the end of their lifetime. The challenges of Circular Economy are so complex that no company can respond to them alone.

Trendy topic

We presented our paper “Circular Economy in Hospitality – a Nordic perspective” at the Sustainable Tourism Development for Southeast Asia Conference in Hanoi in the beginning of December 2019. The conference was a part of our TOURIST project promoting sustainable tourism in Vietnam and Thailand. In our paper, we stated that there is a lack of engagement and real circular deeds by the hospitality industry today. However, as the Circular Economy is here to stay, we aim to probe into the subject further by looking for best practices and innovative solutions in Finland and abroad.

It is high time the hospitality industry, along with the rest of the travel and tourism industry, starts to think about innovative ways to embrace the economy of the future with transformative business models and novel ways to consume products, services and experiences. Let’s go circular!


TOURIST project: The aim of the project is to create competence centres for the development of sustainable tourism and innovative financial management strategies to increase the positive impact of local tourism in Thailand and Vietnam.

Project Information