2016 Sustainability Report
financial impact
We believe providing strong economic returns to shareholders and being responsible stewards of our communities and environment are not mutually exclusive objectives. Through EarthView, Hersha is able to drive incremental value through energy-savings initiatives with measurable and timely returns. Initiatives implemented as part of our comprehensive program provide positive financial returns and, to date, have achieved net savings of $6.8 million.
In 2016, we continued our implementation of portfolio-wide energy savings initiatives such as energy efficient lighting retrofits and guestroom energy management systems. A majority of Hersha hotels have now converted to LED lighting. LEDs are more efficient than incandescent and florescent lighting and have a much longer lifespan. This ROI project is saving over $800,000 annually in electricity costs at our hotels.
Additionally, we continue to install guestrooms energy management systems across our expanding portfolio. These systems reduce energy consumption while rooms are unrented or unoccupied, saving our hotels 25-35% in heating and cooling costs, equivalent to approximately $1 million annually.
It is through initiatives such as these that we have received third party recognition in 2016. For the fourth time in five years, Hersha was awarded NAREIT’s Lodging & Resorts Leader in the Light award. Hersha also participated in the Global Real Estate Sustainability Benchmark (GRESB) and received a score of 88 out of 100, ranking in the top 3% of all GRESB participants globally and first in the Lodging & Resorts sector. On a hotel level, we have achieved 13 Energy Star certifications and three LEED certifications across our portfolio over the past two years.
led energy
efficient lighting
installed at
97%
of hersha hotels*
TripAdvisor
GreenLeader
status at
93%
of hersha hotels*
energy
efficient laundry
installed at
96%
of hersha hotels*
* Percentages reflect Hersha’s core portfolio and include recent acquisitions where some initiatives have yet to be implemented.
Leadership in Energy and Environmental Design (LEED) is the leading benchmark in green building. LEED buildings are certified by the US Green Building Council and use less water and energy, reduce greenhouse gas emissions, and save money.
ENERGY STAR certified buildings meet strict energy performance standards set by the Environmental Protection Agency (EPA). They use less energy, are less expensive to operate, and cause fewer greenhouse gas emissions than their peers.
governance
Clear, concise corporate governance guidelines have become vital in today’s business environment to foster sustained shareholder and consumer confidence. A strong corporate governance foundation will produce efficiency, provide guidance for future endeavors, and contribute to our company’s goal of continuing to operate at the highest level of performance. To that end, Hersha has promulgated a comprehensive Corporate Governance Compendium. Our corporate governance program characterizes our company’s openness and forward thinking, which will lead our future endeavors.
board of directors
Our Board of Directors is comprised of seven members, five of whom are independent directors.
responsible Leadership
Hersha believes that the financial success of our shareholders and the positive growth of our company is fueled by an unwavering commitment to highly ethical and moral business practices. The central tenet of our culture is for all tasks to be performed with unwavering integrity and honesty. We are proud that fair dealing is at the foundation of all that we do. It is our goal to constantly reinforce the promotion of good citizenship and community involvement in the activities of our company. All senior officers, trustees, and employees exercise openness and maintain accessibility to allow transparency and optimal synergies. Above all, we believe good ethical conduct leads to a strong, respectable, and successful company.
Hersha's Governance is best-in-class and recognized across the industry. In 2016, Hersha's Chief Executive Officer, Mr. Jay H. Shah, was recognized by Aethos Consulting as the top performing CEO based on the firm’s proprietary Aethos Value Index ("AVI"). Additionally, in 2014, our Lead Independent Trustee, Mr. Donald Landry, was recognized by the New York Stock Exchange as Lead Independent Director of the Year.
For more information on Hersha’s Governance practices, please visit Hersha’s website to download our Governance Documents.
SVP of Finance and Sustainability, Bennett Thomas and Director of Sustainability, Matthew Lobach present at Hersha’s 2016 General Manager Conference
stakeholder engagement
As a hotel company, our operational activities engage guests, suppliers, non-profits, utility providers and many other individuals and organizations from all over the world. The choices that we make as a company have an impact across our entire supply chain as resource constraints continue to grow. For this reason, we work to create a more sustainable supply chain by converting to recycled materials where possible, reducing unnecessary disposable products, using bio-based products for laundry and cleaning, and establishing an energy and water efficient purchasing policy.
Our focus on sustainability extends to how we engage with potential guests at our hotels. For many of our guests who are increasingly interested in tracking their environmental footprint while travelling, we are equipped to provide environmental information for Request for Proposals (RFPs) from corporate travel managers as well as leisure guests seeking a green stay.
Beyond an expectation of our guests, sustainability is an area of focus for regulatory bodies. Over the past several years, we have seen regulations for energy, water, waste, and reporting increase across the U.S. and in many of Hersha’s core markets. As environmental and social initiatives move from electives to mandates, Hersha is well positioned to comply.
We also know that our associates provide the inspiration and power to accomplish everything that we do as a company. We appreciate that our personal experiences shape how we see the world and we strive to create an atmosphere that welcomes new ideas, refines talents, and values perspectives from all of our associates. To that end, we’ve created training and engagement programs for all levels of associates across our organization. These programs range from electronic learning and on-the-job development programs to classroom and management programs.
