Jens Hofma: ‘It’s an illusion to think hospitality can afford to get greener without regulation’

Jens Hofma, CEO

Industry veteran Jens Hofma insists it “would be an illusion” to think the hospitality industry can just absorb the full cost of going green on its own and believes progress could be achieved a lot faster if the government  implemented a “fairer” tax system.

Mr Hofma is the CEO of Pizza Hut Restaurants UK, which is a founding member of the Zero Carbon Forum. It is working alongside other high profile restaurant brands to create templates for reducing carbon emissions share best practice.

Reflecting on the potential costs involved with carbon reduction measures and the extent to which it should be passed onto customers, Mr Hofma said greater government intervention is needed.

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He outlined: “Hospitality is not a high margin sector – we tend to operate on very low margins. We’re also one of the most heavily taxed sectors in the UK economy. We’ve got the highest VAT rate in the whole of Europe; we tend to deploy a lot of labour which also attracts its own taxes, so we’ve got quite a squeezed P&L.

“It would be an illusion to think that industry is just going to absorb any on-cost of a greener approach. In the end, we either have to find more cost-effective solutions or it needs to partly pass onto the consumer or – and I think this is where the government has a very important role to play – it needs to be shouldered by the government through a much fairer taxation system than the one that we’re currently enduring.”

Mr Hofma said he doesn’t believe it is possible to effectively harness the market economy to address climate change without a level of regulation.

“We need to create a level playing field. Consumers are not going to be flocking into our restaurants just because we’re doing the right thing for the climate – certainly not in the short term – so to the extent that there’s additional costs that occur as a result of being a green organisation we need to make sure that there is more of a level playing field than most competitors in the sector. And that requires a rethink of our taxation system.

“I think our taxation system is antiquated, we tax the wrong things and therefore drive the wrong behaviours in the market economy; essentially we tax labour and we should be taxing climate emissions, we should be taxing CO2 footprints, so that we use taxation to drive the right behaviours within the market economy and within our sector.”

Pizza Hut Restaurants UK operates more than 200 sites in the UK and completed a full carbon footprint assessment two years ago that it has used to drive changes in the business. It has reduced electricity, gas and water usage, introduced more efficient equipment and LED lighting, and achieved better usage via regular reports from smart meters and educating teams on energy conservation.

It is also co-chairing one of the three working groups of the Zero Carbon Forum, tackling scope 3 emissions across the value chain, coordinating efforts with other hospitality operators and their suppliers.

Mr Hofma said that addressing carbon reduction challenges at a corporate level requires leadership from the top.

“I think many leaders of my generation are in the habit of delegating difficult issues to their public relations department, they cannot come up with a great story that basically absolves them from any responsibility. This is definitely a topic that needs to be driven right from the top of the organisation and then it requires a spirit of humility because we don’t have the answers – we have a huge amount to learn.

“These are very complex topics, it’s very easy to knee-jerk into symbolic actions that sound nice, that don’t actually make a massive difference in reality, and this is why I welcome the [Zero Carbon] Forum so much because as an industry we have huge potential to learn from each other, to learn from experts, and ensure that the action we are taking is going to have the right impact and the right consequences.”

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Tags : Pizza Hutsustainability
Andrew Seymour

The author Andrew Seymour

1 Comment

  1. Mr Hofma is absolutely right. Food firms who are showing genuine effort by being environmentally responsible buying the most Energy Efficient equipment should be supported like many other industries currently enjoy. Well said. Justin Cadbury

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