“As we continue to execute on our mission and vision, sustainability supports our three strategic principles: high-quality hotels in urban and destination resort locations, innovative asset management, and conservative capital structure. Through our sustainability objectives and initiatives, we aim to increase shareholder returns by implementing programs designed to reduce utility consumption and increase profitability in our portfolio of hotels”.
Mark W. Brugger
Chief Executive Officer, DiamondRock Hospitality Company
Our fifth sustainability report highlights our approach and progress for material sustainability issues as a real estate investment trust (REIT) with a portfolio of full-service hotel properties in the United States located in key gateway cities and destination resort locations. To assist readers, we have included a GRI Content Index and provided performance tables with key environmental, social and governance (ESG) metrics.
Strategy, Engagement and Governance
DiamondRock remains conscious of the investment community’s increasing attention to ESG reporting; we are committed to enhancing the value of our sustainability platform through open and transparent communications with our stakeholders.
Our sustainability objectives are designed to support our Company’s vision and strategic principles through measures to:
- Reduce energy and water consumption,
- Increase profitability at our hotels,
- Proactively manage environmental risks, and
- Make positive contributions to communities.
As a lodging REIT, success requires collaborating with key stakeholders (stockholders, employees, management companies, brand companies, suppliers, partners, communities, and industry associations) and working with our management companies to identify opportunities that help us achieve our sustainability objectives.
Our corporate governance guidelines define our Board of Directors’ structure, objectives, procedures, qualification and compensation. Our Board of Directors’ committees are reviewed annually by our Board and are modified as appropriate to ensure that they comply with current regulations in addition to aligning properly with the needs of our organization and stakeholders. For more information, we invite you to review our Corporate Governance page.
To support our sustainability objectives, our Executive Officers actively engage with our Asset Management, Investment and Design, Development, Construction, and Legal teams to review operating performance at hotels and evaluate capital expenditures opportunities.
To further support DiamondRock’s mission, we have published Sustainability and Human Rights Policies. Our Sustainability Policy focuses on collaboration with stakeholders to create value and reduce risk through our sustainability initiatives; promotion of environmental stewardship practices; health, safety, and well-being of employees, contractors, and hotel guests; and community engagement through the support of local charities and monitoring community impacts. Our Human Rights Policy focuses on conducting our business in a manner consistent with the United Nations Universal Declaration of Human Rights and the International Labor Organization’s Fundamental Conventions. This includes a commitment to ensure respect, equality, and inclusiveness for employees, and promotion and protection of fundamental human rights by third party management companies.
2025 Sustainability Targets and Performance
In 2018, we announced our portfolio-wide energy, carbon and water targets. These environmental targets aim to reduce energy, carbon and water intensity by 25%, 40% and 25% respectively by 2025 from our 2011 baseline. (Our 2025 energy and carbon reduction are based on intensity per square foot. Our 2025 water target is based on intensity per occupied room.)
Through these targets, we aim to continuously improve our environmental performance throughout our portfolio of properties. Since 2011, we have reduced energy intensity by 13%, emissions intensity by 28% and water intensity by 20%.
Sustainability Investments and Portfolio Management
Across our portfolio, we continue to make strategic investments in sustainability and emissions reduction projects. We also engage in preventive maintenance and invest in enhancements to roofs, façades, and structural property elements to protect against weather-related risks.
Additionally, we monitor energy consumption and consider other environmental risks specific to the locations and regions where our hotels are located.
In addition to the sustainability investments we make, we take a strategic approach to portfolio management by continuing to conduct a portfolio-wide water risk assessment using the World Resources Institute’s Aqueduct tool and Ecolab Water Risk Monetizer. We plan to continue monitoring potential changes in the cost and availability of water in key markets, such as California, and leveraging the water risk assessments to inform future decision making on capital expenditures for water efficiency projects.
In 2017, we continued to support the Cornell Hotel Sustainability Benchmarking study and encouraged the companies that manage our owned hotels to participate. We will be using the results to engage with our management companies on performance and to help support the industry initiative to develop common hotel benchmarks for energy, greenhouse gas emissions, and water consumption.
Sustainability at our Hotels
Our hotels continuously strive to improve their environmental performance through the implementation of sustainability practices, installation of equipment to reduce overall impacts, and usage of responsible products.
For example, two of our New York City properties, the Hilton Garden Inn New York / Times Square Central and Courtyard New York Manhattan / Midtown East, have installed Organic Refuse Conversion Alternative (ORCA) machines, which enable rapid composting of organic matter to reduce waste to landfills. Additionally, the Renaissance Lodge at Sonoma Resort & Spa installed a 7,000 square foot artificial lawn in their outdoor space. The lawn reduces water consumption by 15,000 gallons annually, decreases erosion and improves drainage capabilities. The Westin Washington D.C. City Center is currently conducting an energy efficiency study to install light sensors throughout the hotel, including in all public areas and back of house. To reduce the hotel’s energy cost and carbon footprint, the Chicago Marriott Magnificent Mile installed 12 rooftop solar panels, which will conserve about 6,000 kWh annually.
As DiamondRock continues to increase energy and water efficiency and decrease waste to landfills, we will continue to work with our properties to make strategic investments.
At our corporate headquarters, we strive to give back and support local charities as well as national charities that promote education, environmental conservation, and public health. In 2017, DiamondRock contributed $108,000 in charitable donations through its corporate giving program that began in 2007.
In 2017, we supported 14 organizations, including The Leukemia Society, March of Dimes, Marriott Foundation, Potomac Community Resources, Service Source Foundation, The Lab School of Washington, N Street Gala, Make a Wish Foundation, Children’s Hospital Foundation, The Ireland Fund, Cornell University and Penn State University. These organizations help to support United Nations Sustainable Development Goals targeting poverty, health and education.
In addition to DiamondRock’s corporate giving programs, each of our owned hotels’ brands, including Marriott® and Hilton®, and our management companies are engaged in targeted community development and engagement programs to support the communities where our hotels are located.
We believe prioritizing employee well-being is a key element for attracting and retaining the best and talented associates. In our corporate office, DiamondRock employs 29 full time employees. We provide all employees with 100% coverage of the premium for health care and dental insurance, group term life insurance and short and long-term disability insurance. Employees also receive a mid-year and annual performance review at year-end to aid in their professional development. In 2018, DiamondRock employees also participated in an employee satisfaction survey.
We also provide all parents up to eight weeks of paid leave for the birth or adoption of their children. DiamondRock continues to offer up to $10,000 for financial assistance to all employees who wish to further their education.
We encourage our employees to engage with the local community and each year the Company takes a day and performs some type of community service. In 2017, DiamondRock partnered with the Children’s Inn at National Institutes of Health (NIH). This is a residential facility that allows families with seriously ill children to stay free of charge while undergoing research/treatment at NIH. Following a tour of the facility, DiamondRock employees created handmade gifts for each of the children and their siblings staying at the Inn (over 75 gifts were delivered to the Community Outreach Director at the facility.)
To further increase employee engagement, DiamondRock continues to utilize an employee-led committee that plans company-wide social and community activities, including a yearly community involvement event, in which all employees contribute to a community project.
In 2018, DiamondRock plans to continue our company-wide commitments to sustainability and the community. These include reducing energy, carbon and water intensity at our hotels, proactively managing environmental risks by measuring impacts and making strategic sustainability investments, and making positive contributions to communities through supporting local and national charities.
GRI Index, ESG Performance Data