Albergo Diffuso: a Sustainable and Socially Innovative Business Model

6 EXECUTIVE SUMMARY The tourism and hospitality industry has experienced a progressive expansion and diversification in the last years, becoming one of the largest and fastest-growing industries in the world. Due to the Covid-19 pandemic, the Tourism Direct Gross Domestic Product, corresponding to the part of GDP produced by tourists, dropped by more than half in 2020. However, the forecast for 2022 is optimistic about a progressive recovery. Unfortunately, the activities of this industry did not show much ambition to become more sustainable, even though tourists are more interested in sustainable service offers and there is a growing awareness of the impact of business practices on the environment. As a matter of fact, the tourism and hospitality industry is crucial for its direct impact on the natural and cultural heritage and on local communities. Thus, businesses operating in this industry should straighten their strategic orientation towards sustainable development, reconsidering how they create, deliver and capture value. Innovating a business model to reach sustainable goals is challenging for tourism businesses. Still, it also creates new opportunities and gives the chance to address the emerging global challenges of inequality, poverty, environmental degradation and climate change on which the Sustainable Development Goals are focused (SDG). For this reason, the SDG became a strong driver of change, with the development of the 2030 Agenda on behalf of all the United Nations Member States, which committed themselves to reaching the 17 SDGs requiring the contribution of private actors as well. Adopting a sustainable model requires the collaboration of local communities and other business partners to reduce the potential negative externalities caused by stakeholders’ activities and promote the production of positive impacts. The transition to sustainable business models (SBM) does not represent only a way to be ethical and sustainable, but also a way to create value and competitive advantage. An SBM is not centred only on the mere financial value creation, but it extends the value created to the social and environmental areas impacting the company’s competitive advantage and creating outcomes affecting several stakeholders. The SBM enables the attainment of SDGs and enhances the creation of a shared value, increasing the company’s competitiveness while strengthening the development of the economic and social conditions in the community of interest.