A business traveller travelling light. Picture: Pexels
In a bold move underscoring South Africa’s fight against climate change, President Cyril Ramaphosa signed the Climate Change Bill into law. Passed on April 25, 2024, this new legislation tightens the reins on greenhouse gas emissions, including those from corporate travel.
According to Bonnie Smith, GM of Corporate Traveller, this legislation marks a turning point for business travel in South Africa.
“Companies must now consider their travel practices as part of their broader environmental, social, and governance strategies,” she said.
If your business in South Africa depends on executives closing deals, technicians fixing on-site issues, or teams flying across time zones for in-person meetings, the business travel expert offers insights on how the bill impacts your company’s business travel.
Understanding the Climate Change Bill
According to Smith, the Climate Change Bill is set to shake up business operations in South Africa as it establishes a framework for managing climate change nationwide, with climate forums at provincial and local levels.
“If your business operates in multiple regions, engaging with these forums could become necessary,” said the business travel expert.
She also added that the Bill tightens how South Africa tracks and reports greenhouse gas emissions, therefore, companies, especially large ones, will face stricter reporting requirements.
The government will use this data to set emission targets across different sectors.
“Big emitters will be assigned carbon budgets — essentially caps on how much greenhouse gas they can release. This could directly impact operations, including travel practices.
“In short, businesses need to start thinking about their carbon footprint now. Evaluate every aspect of your operations, including business travel, and look for ways to cut emissions,” said Smith.
She also stressed that business trips aren’t going away, however, they’re just becoming smarter and more sustainable. “We’re witnessing a paradigm shift.
“Companies are now asking not only about travel costs but also about its environmental impact. They want to know how to reduce their carbon footprint without compromising business goals,” said Smith.
How travel management companies are adapting
The business travel expert said that as businesses navigate these new regulations, travel management companies (TMC) are stepping up to meet evolving client needs.
“We’re no longer just booking flights and hotels. TMCs are now strategic partners, helping companies fine-tune their travel plans to cut emissions and stay compliant with the new laws,” she said.
Smith highlighted that TMCs are rolling out a range of tools and services to promote sustainable travel.
For instance, FCM has introduced carbon reporting, enabling companies to track their travel-related carbon footprint. This kind of transparency is vital for businesses aiming to manage their environmental impact.
“These reports give a detailed look at the emissions generated by corporate travel, tracking everything from flights to accommodations. With this data, companies can pinpoint where they can cut back on emissions. It helps businesses make smarter travel decisions, set and track sustainability goals, and align with CSR initiatives,” said Smith.
She also said that TMCs are also aiding clients by identifying and promoting greener travel options, such as lower-emission transportation and eco-friendly accommodations.
“By clearly presenting these choices during the booking process, we empower travellers to make informed decisions,” said Smith.
The business travel expert also said that the most impactful support TMCs provide is in policy development and they are helping companies draft travel policies that align with the new regulations.
“This could mean setting criteria for when travel is necessary, prioritising lower-emission options, or incorporating carbon budgets into travel planning,” said Smith.
The business case for sustainable travel
Lastly, Smith noted that while the new regulations might seem overwhelming, there’s a silver lining for businesses as sustainable travel practices often lead to cost savings.
“By optimising travel routes, cutting unnecessary trips, and choosing more efficient transportation, companies can reduce both their carbon footprint and travel expenses.
“Additionally, adopting sustainable travel can boost a company’s reputation, opening doors to new opportunities in an increasingly eco-conscious market,” said the business travel expert.
She said this aligns perfectly with the Bill’s goal of capitalising on the global shift towards a green economy, however, the Bill’s success hinges on overcoming significant challenges.
“The government will need to implement strong enforcement mechanisms, including meaningful penalties for companies that exceed their carbon budgets. The era of unrestricted business travel with little regard for environmental impact is over.
“What will emerge instead is a more thoughtful, efficient, and sustainable approach to corporate travel,” said Smith.
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