The Fallout of Market-Oriented Sustainability Measures: Tourism Destination Sustainability Benchmarking and Ranking

Introduction

The tourism industry’s increasing emphasis on sustainability has given rise to an abundance of sustainability indicators, certifications, and indices (Kristjánsdóttir et al., 2018; Rasoolimanesh et al., 2023). Subsequent research has explored these measures from various angles, encompassing their development (e.g., Blancas et al., 2011), usefulness (e.g., Font & Harris, 2004; Font & Tribe, 2001), inner workings (e.g., Dias, 2017; Mikulić et al., 2015), and whether there is demand for them among businesses (e.g., Jarvis et al., 2010) and consumers (e.g., Tasci, 2017). Many of these measures and the subsequent research have focused on specific subsets of the tourism industry, but there has also increasingly been a focus on sustainability measures at the destination level, which is the focus of this letter.

A distinction should be made between a sustainability indicator, understood as “a measure of the existence of some issue or phenomenon of interest” (Volo, 2015, p. 277), certification, which represents a “documented assurance that a product, service or organisation complies with a given standard” (Font, 2002, p. 213), and index which in this letter is defined as a fixed set of measurable indicators. Tourism sustainability indices have primarily been developed and used as a tool to monitor destinations’ sustainability level over time, assess conditions and needs, set targets and eventually inform decision making (Gasparini & Mariotti, 2023; Kristjánsdóttir et al., 2018; Torres-Delgado & Saarinen, 2014). However, recently, it has been recognized that sustainability also contributes to competitiveness at the destination level (Rodríguez-Díaz & Pulido-Fernández, 2019). Following this, indices which allow for benchmarking and ranking of destinations become attractive because they can contribute to market-oriented competition between tourism destinations wishing to showcase their level of sustainability. This is unlike certifications, which represent a minimum threshold standard that a company either adheres to or not.

This study explores the question of what happens when tourism sustainability performance is no longer only measured as a minimum standard, by means of certification or used as a monitoring tool to inform policy making, but also becomes a point of direct market competition, by means of indices that allow for benchmarking and ranking.

Thus, it addresses a beginning proliferation of destination sustainability index and rankings, due to their ability to showcase a destination’s level of sustainability in direct comparison to other destinations. This proliferation comes as a result of increasing attention from consumers on destination sustainability credentials, which in turn creates interest and incentives for destinations to document their level of sustainability in order to attract visitors. While some studies have found little demand for destination sustainability benchmarking among consumers in the past (Tasci, 2017), evidence that suggests that this is no longer the case has emerged since. A recent study of 11,000 consumers in 11 markets around the world found that 90% of consumers look for sustainable options when traveling, and that 70% of consumers have avoided a destination or transportation option, because they did not perceive it to be committed to sustainable practices (Expedia Group Media Solutions, 2022). The study also found that 70% of consumers felt overwhelmed by the process of being a more sustainable traveler. Specific to North-western Europe, a recent study found a dominant so-called “green idealist” segment, who prioritize sustainability highly when they travel, to account for 40% in Germany, 33% in Sweden, 32% in the Netherlands and 23% in Norway (Visit Denmark, 2022). These results indicate a rising demand for clearly communicated sustainability benchmarking, at the destination level, to ease consumer choice. This demand is also evident in media outlets, where articles and lists assessing the sustainability of different destinations are on the rise, and on the supply side, as many destinations are actively promoting their positions in these sustainability rankings.

In the introduction to a recent special issue on sustainable tourism indicators, Miller and Torres-Delgado (2023) argued that “the risk with focussing on the measurement system is that it moves us further away from the objective, which is to improve the sustainability performance of tourism.” (p. 1485). This letter argues that sustainability rankings can potentially lead to this problem for participating destinations. Thus, it calls attention to the risks of these kinds of indices and rankings in terms of how they can and will be used. First, because they may incentivize destinations to focus their efforts more on the aspects that are and can be measured. Second, because what is measured does not necessarily correspond with what is most impactful in terms of sustainable development. Concrete examples of projects that aim to scrutinize such rankings in order to ascend them are a testament to their potentially pivotal role in influencing how destinations strategically prioritize their sustainability efforts. See for example “Sustainable Choice Copenhagen” which had as a stated goal to make Copenhagen climb from second (in 2021) to first place on the Global Destination Sustainability index (GDS).

In summary, sustainability index and rankings that allow destinations to benchmark and market themselves based on their sustainability performance play a pivotal role in influencing tourists’ destination choices, shaping destination marketing strategies, and affecting sustainability endeavors at destinations. This calls for scrutiny, especially because research which focusses on these destination benchmarks/rankings and their implications is lacking.

In this letter, the Global Destination Sustainability Index (GDS) is used as an illustrative case (Siggelkow, 2007) to show and reflect on what may happen when sustainability becomes a point of competition. Importantly, the goal is not to denounce sustainability index or rankings. They play an important role in incentivizing destinations to focus on sustainability efforts by making them measurable and a point of competition. And it can well be argued that even faulty sustainability benchmarking is better than no benchmarking at all. Nor is it meant as a disapproval of a specific index, in this case the GDS, which is among the more transparent and rigorous destination sustainability benchmarks. In fact, its transparency and rigor is a primary reason it was chosen to exemplify some of the potential pitfalls of the sustainability benchmarks it represents.

Destination Sustainability Index and Rankings

Two important examples of destination indices are respectively European Tourism Indicator System for Sustainable Destinations (ETIS) and The Global Sustainable Tourism Council Criteria (GSTC-C). Comprising 43 core indicators ETIS, was developed and then tested with the participation of more than 200 destinations as well as a pool of experts between 2013 and 2016. The ETIS toolkit is freely available and can be adopted by all. During and subsequent to its development, implementation challenges have been documented (Modica et al., 2018) and although some destinations implement it in their activities (e.g., Siggins, 2022), it appears less prominent in popular media and among destination organizations. GSTC-C comprise specific and separate indicators for destinations and tourism businesses. Based on the 17 Sustainable Development Goals (SDGs) these criteria “have been built on decades of prior work and experience from around the world and take into account the numerous guidelines and standards for sustainable tourism from every continent” (https://www.gstcouncil.org/). GSTC-C does not certify individual companies but accredits and recognizes sustainable tourism certification bodies. A key role of ETIS and GSTC-C is to act as a minimum standard for providers of sustainability certifications, as well as destinations and companies. They have been promoted and used primarily as planning, policy making and management tools (Font et al., 2023) and rarely for direct competition between destinations.

Other destination sustainability indices allow for ranking of and direct competition between destinations and have subsequently been more commonly used in their communication efforts. As mentioned, increased attention from consumers and other stakeholders is the most likely reason for a beginning proliferation of such rankings. The Data Appeal Company has for example used ETIS as a basis for their ranking. Less rigorous rankings made by various media outlets and organizations have also emerged including “The Sustainable Living Guide,” Tourlane’s “Best Cities for Sustainable Travel” and “Green Destinations Top 100 Stories.”

However, the destination index/ranking that has received the most attention from the media and destination management organizations is the Global Destination Sustainability Index (GDS). Around half of all Google results when searching for keywords such as “Tourism sustainability index” or “Destination Sustainability Index” refer to the GDS. GDS is also often referred to as the world’s leading destination sustainability ranking by various media outlets across the world, as well as by destination management organizations (e.g., Čad, 2022; Newswire, 2022; WheelsUP, 2022) and itself claims to be “the world’s leading sustainability benchmarking and performance improvement program for destinations, and their visitor economy.” (https://www.gds.earth). As already mentioned, destinations are actively working to ascend the GDS for example through concrete projects with this purpose. Media outlets also use it as a basis for their writing about sustainable destinations. In their recommendation of Gothenburg, Lonely Planet for example writes: “Gothenburg has held the top ranking in the Global Destinations Sustainability Index since 2016 and its progressive, measurable solutions for sustainability wowed our expert panel.” Finally, destinations including for example Bangkok, Berlin, Bordeaux, Cork, Kyoto, and Montreal, actively use their position on the ranking in relation to competing destinations in their communication efforts.

GDS was created in 2015 by 15 Scandinavian Cities, MCI and the International Congress and Convention Association (ICCA). Since then, it has been expanded to also cover the leisure tourism industry. GDS focuses on sustainability at the destination level. The index applies a rigorous methodology comprising 70 indicators, which are aligned with the Sustainable Development Goals (SDGs), and reevaluated by the GDS, destinations, and experts every year. Destinations voluntarily sign up to join. It is evident from the communications of various destinations that joining the index in and off itself is treated as a sign that a destination is opting in to focus more of their efforts on being sustainable, because they can now be held accountable by being compared to their competitors. As such the index only comprises destinations with some level of ambition in terms of sustainable destination development. Originating in Europe, the bulk of participating destinations are still European, although the index is expanding to include more destinations worldwide year by year. In 2022 GDS had 66 participating destinations.

Given its number of participating destinations and its European bias, it cannot be considered as representative of a global tourism industry. However, with its still relatively wide geographical reach, number of participating destinations, dominance on media channels, and active use by destinations in their communication efforts, it is considered to be the best representation of a market-oriented sustainability index that benchmark and rank destinations against each other and is actively used in the marketing efforts of destinations.

GDS as an Illustrative Example of Potential Pitfalls

The 2022 GDS-Index comprises 70 indicators that evaluate the destinations across four key areas: Environmental Performance, Social Progress Performance, Supplier Performance, and Destination Management Performance. Based on these scores, GDS ranks destinations in a Overall Top 30, which is prominently featured on their website, and often appear in the communication efforts of destinations. It also includes four topic rankings corresponding to the key areas mentioned in Table 1, these feature less prominently on the GDS website, but are used by some destinations who perform well in these categories in their communication efforts. The GDS benchmarking methodology, which includes a full list of indicators and their weighing is publicly available and can be accessed here: https://www.gds.earth/wp-content/uploads/Methodology-2023.pdf

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Table 1.

Key Categories, Number of Indicators and Weighting in GDS.

Category	Number of indicators	Total max points	Category weighting (%)
Environmental performance	17	60	30.92
Social performance	11	38	16.43
Supplier performance	14	38.5	20.29
Destination management performance	28	68.5	32.37
Total	70	205	100

In and of themselves, the four key areas and their weightings reveal parts of what is prioritized and incentivized by the index. To top the list, a destination has to perform well in all categories—the current top destination, Gothenburg, has an overall score of 92.98%. However, to be in the top 10, it is possible to neglect or favor some aspects over others, which makes it relevant to scrutinize the category weightings and contents.

The environmental and social performance criteria relate to the destination’s general progress and performance (e.g., Does the city have a climate change mitigation and adaptation strategy?, What are the city’s greenhouse gas emissions per capita?), whereas supplier and destination management performance is directly related to the tourism sector (e.g., What percentage of the destination’s hotel room inventory has an active third party sustainability certification?; Does the DMO have a sustainability strategy for the visitor economy?). It is reasonable that a destination sustainability index is based on the destination’s general sustainability performance, however, it is worth noting that almost half of the score (47.35%) can be achieved without any actions from the tourism industry. Criteria that directly address what the tourism industry does (supplier performance) account for only a fifth of the total score (20.29%). As such, it is possible, at least in theory, to gain a position in the top 20 without any actions from tourism suppliers.

Similarly, there are specific examples of destinations that rank highly even if the sustainability actions of tourism suppliers are limited. One destination for example appears in the top 10 of the main ranking, while appearing below the top 30 in the supplier category. Naturally, the sustainability of a destination encompasses dimensions beyond the activities of tourism suppliers, and there is a chance that good intentions and a focus on destination level sustainability indicators may translate into action among practitioners in the longer run. However, there are also a number of risks associated with this.

First, there is a risk that destinations that are good at strategizing, planning and communicating about their sustainability efforts, albeit with little action on the ground, are rewarded, while those that genuinely exhibit higher levels of sustainability, but lack a strategic approach or adequate means to communicate it are punished. Second, there is a risk that tourism suppliers can hide behind the otherwise positive indicators at the destination level. In destinations where tourism industry companies are powerful and unwilling or slow to change, this could incentivize destinations and Destination Management/Marketing Organizations (DMOs) to prioritize other aspects that it is easier to achieve. This is particularly the case in destinations that already perform well in the non-tourism categories—environmental and social performance. Other risks associated with this are unfolded below.

Conclusion

This letter recognizes that destination benchmarking and rankings can be an important means to increase the sustainability of tourism destinations. However, it also argues how they may incentivize destinations to focus on the aspects that are measured, and, as a result, become determinants for how destinations prioritize their sustainability efforts. This becomes problematic in cases of misalignment between the focus of an index and real sustainability impacts. The GDS is used as an illustrative case to show how such misalignment is present even for an index that applies a relatively rigorous methodology. Specifically, the GDS for example: arbitrarily incentivizes destinations to focus on certain aspects (e.g., food operations) and not others, although they may have a high potential impact (e.g., transportation or energy consumption); prioritizes the actions of the DMO above all tourism suppliers in a destination; and only pays limited attention to tourism social sustainability issues. This is particularly problematic because the GDS claims to be and is used in marketing efforts, not primarily as a DMO index, but as a destination index also encompassing city and supplier efforts. Based on Miller and Torres-Delgado (2023), there is reason to believe that destinations competing to improve their rank on this index may be swayed or tempted to focus on what is measured, in other words the aspects that will improve their ranking, rather than on the aspects with the highest sustainability impact. Thus, rankings like the GDS could potentially lead to greenwashing, although this implies malign intent. More likely, they may influence and incentivize destinations to focus on specific and potentially less impactful aspects or to ignore important aspects in terms of real sustainability impact.

With the increasing focus on sustainability from stakeholders and consumers and the emerging use of sustainability rankings in marketing efforts, there is reason to believe that the number, importance and impact of destination sustainability indices, which allow for benchmarking and ranking will rise. Research into sustainability metrics have primarily focused on two categories: those adhering to a threshold minimum standard and those designed chiefly for the purposes of monitoring and policy formulation. However, researchers have also argued that such measures have a limited direct effect on policy making and consumer choice (e.g., Gasparini & Mariotti, 2023). As argued, these measures’ limited scope for direct competition are likely the reason for their infrequent use in destinations’ communication strategies. A destination either attains certification or does not, and while certification might confer a temporary competitive advantage, this dissipates as soon as competitors reach equivalent certification levels. Therefore, such certifications and monitoring systems are more useful as tools to lift minimum standards in the industry, than to incentivize them to go beyond the minimum requirement.

Destination indices that allow for benchmarking and rankings are different in this regard. They are dynamic and the goalpost moves as competing destinations raise their ambitions. Thus, destination sustainability benchmarks and rankings have potential to create more change at destinations, as they compete to stay on top. However, as argued, they also hold a greater potential to incentivize counterproductive actions, because destinations may lose sight of the purpose—sustainability impact—in their chase toward the top of a ranking.

Thus, whereas certification and monitoring tools have dominated and been useful in raising the minimum sustainability standards at destinations, benchmarks and rankings have entered as tools with great potential to supplement certifications, by introducing sustainability as a direct market-oriented competition parameter. Yet this opportunity comes with potential fallout that needs to be understood beyond the examples given in this letter. Therefore, it calls for further attention to and research on market-oriented sustainability indices that allow for benchmarking and ranking, and their implications for sustainable tourism development. This could include further investigation on sustainability benchmarks and rankings and the differences between different ways of measuring sustainability; scrutiny of what is measured/incentivized by specific indices/rankings—whether they measure what they claim to and the outcomes of this; how such rankings may affect decision-making for various destination stakeholders, including tourism businesses and DMOs; and finally, how, and how much they affect destination choice for tourists.