IDEAS home Printed from https://ideas.repec.org/a/inm/orserv/v16y2024i3p172-183.html
   My bibliography  Save this article

Improving Hotels’ Operational Efficiency Through ESG Investment: A Risk Management Perspective

Author

Listed:
  • Kyunghwa Chung

    (College of Business and Management, Vin University, Hanoi 100000, Vietnam)

  • Lan Thi Mai Nguyen

    (College of Business and Management, Vin University, Hanoi 100000, Vietnam)

  • Dung Thi Thuy Nguyen

    (Academy of Finance, Hanoi 100000, Vietnam;; Institute of Economics and Strategic Management, Hanoi 100000, Vietnam)

Abstract

Though environment-social-governance (ESG) practices are increasingly prevalent in the business world, academic research about the impact of ESG on firms’ efficiency remains in its infancy. In this study sampling 24 international hotel firms during the period of 2013–2019, we examine how ESG standards improve these hotels’ operational efficiency obtained via data envelopment analysis (DEA). We further investigate how ESG can help manage a crisis by examining the period before and after the COVID-19 pandemic. Our results reveal that ESG can indeed enhance hotels’ efficiency. Specifically, the social and environmental aspects are the most important factors that contribute to the operational efficiency of hotel firms. In the context of the COVID-19 pandemic, hotel firms with the best ESG practice can be more efficient than others, especially those that have very high environmental and social scores. Overall, our findings suggest that hotel firms should consider ESG investment, not only as an effective and sustainable strategy during normal times but also as a crisis management strategy to overcome unexpected crises that may arise in the future.

Suggested Citation

  • Kyunghwa Chung & Lan Thi Mai Nguyen & Dung Thi Thuy Nguyen, 2024. "Improving Hotels’ Operational Efficiency Through ESG Investment: A Risk Management Perspective," Service Science, INFORMS, vol. 16(3), pages 172-183, September.
    • Handle: RePEc:inm:orserv:v:16:y:2024:i:3:p:172-183
    DOI: 10.1287/serv.2023.0080
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/serv.2023.0080
    Download Restriction: no
    File URL: https://libkey.io/10.1287/serv.2023.0080?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:orserv:v:16:y:2024:i:3:p:172-183. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.