“Your suite of tactics that you are going to apply to the carbon crisis is going to be unique to your business.” — Shannon Guihan

How can your travel business make a substantial impact through climate action? The Travel Corporation’s innovative Carbon Fund offers a compelling model for structuring impactful, place-focused tactics that can be tailored to an organization’s needs.

As the parent company of major global brands like Trafalgar and Contiki, The Travel Corporation’s commitment to reaching net-zero carbon emissions has the potential to make a substantial impact across the travel industry. Shannon Guihan, the company’s Chief Sustainability Officer, is leading the sustainability strategy that has moved the company’s entire suite of brands beyond carbon offsetting to achieve real decarbonization.

The Carbon Fund is a dedicated reserve for decarbonization initiatives, with one of its key solutions being insetting—reinvesting money back into the company to improve its own energy efficiency. This approach means the business is not just compensating for its carbon footprint with offsets, but actively reducing it from within. 

For those looking to drive change within their organizations and bring executive leadership on board, Shannon explains that this approach is about more than reducing emissions—it’s a way to build a more resilient business and create long-term value.

In this episode, you’ll also learn:

• How the Carbon Fund targets different levels of emission reductions.
• What makes offsetting different than insetting.
• How The Travel Corporation is setting science-based targets to reduce emissions.
• Advice for getting your C-suite on board with climate action.

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Show notes

The Travel Corporation — A family of 40 travel brands dedicated to shaping unforgettable travel experiences that leave a positive impact. 

The TreadRight Foundation —  A not-for-profit organization created as a joint initiative between The Travel Corporation’s family of brands that works to have a positive impact on the planet, people, communities, and wildlife. 

Episode transcript

Shannon Guihan: At the minute, our carbon fund is anywhere from 3 to 5 million a year with the view to increase any one business’s response to insetting versus offsetting. The number one thing they need to think of is not, oh, TTC did this or business XYZ did this. No, it’s your business model. Your suite of tactics that you are going to apply to the carbon crisis is going to be unique to your business.

David Archer: Welcome back to Travel Beyond, where we partner with leading destinations to bring you inspiring solutions to the greatest challenges facing communities and the planet. I’m David Archer from Destination Think, recording from Haida Gwaii, the territory of the Haida Nation off the north coast of British Columbia in Canada.

We look at the role of travel here and choose to highlight destinations that are global leaders. We talk to the change makers who are addressing regenerative travel through action in their communities and often from the bottom up. And we’re always looking for the best examples of efforts to regenerate economies, communities, and ecosystems.

So please reach out. If you have a story to share with us or a good example, you can email me at David at destinationthink.com. Last week’s episode was all about World Tourism Day and the launch of 100 Travel Innovations, an initiative to share the stories of real world examples of sustainable solutions led by the travel industry, those solutions that are already making a difference and can inspire others to, you know, make positive change happen faster.

You can access that project right now at innovate. destinationthink. com. Today, we’re going to hear from someone that I mentioned two weeks ago on the show in the lead up to World Tourism Day. Shannon Guihan is the Chief Sustainability Officer at the Travel Corporation, and she spoke at our 24 hours of Travel Innovation event about what travel businesses can do to make a substantial impact in their climate actions. The travel corporation is a large international hotel and travel company headquartered in California. It’s in charge of many brands, including well known tour operators like Trafalgar and Contiki. So being the Chief Sustainability Officer here carries the potential to make a big impact.

And Shannon is also the head of the TreadRight foundation, which is the not for profit organization connected to the company. Shannon told our CEO, Rodney Payne, all about the carbon fund the company has created and an approach to decarbonization called insetting, as opposed to offsetting. Insetting is a little bit less known, I think, and it’s all about making changes as a company to reduce carbon emissions within its own operations, as well as insetting in their entire supply chain or industry, potentially. Shannon also tells us about getting the C-Suite at The Travel Corporation to recognize the value of that carbon fund project. And that comes along with some other valuable insights she offers for businesses or others working in similar roles or people who care about sustainability in travel organizations everywhere who need to bring others along the journey with them.

She also tells us about using science based targets to reduce emissions and why the travel industry needs a stronger voice in sustainability discussions. And those are things we’re definitely aligned with here at Destination Think. There are a lot of good nuggets in this conversation, so I hope you enjoy it and learn a few things along the way.

Here are Rodney Payne and Shannon Guihan. 

Rodney Payne: I’ve been looking forward to this discussion, uh, Shannon, because of the work that you’ve been doing at the Travel Corporation for a long time, and reducing carbon emissions is something that other organizations can and need to learn about. Welcome. Uh, can you tell me what you love most about your role at TravCorp?

Shannon Guihan: Thank you. First, pleasure to be here. Yeah, uh, what I love most about my role is the fact that my, my peers and the, this is everyone from all of our amazing TDs all the way to the Executive, they get it. And so there’s no selling. And there’s no need to have to articulate the value behind improving one’s sustainability performance over and over and over again, and being on that journey.

It’s just, it’s understood. And that’s, um, I hate to say it, but it is a blessing. It’s, it’s really remarkable. It’s a huge enabler. 

Rodney Payne: There’s not many people that I speak to who can say that, and I think that is a friction, um, that makes innovation, uh, much more likely, if you can remove that friction, that, that’s a terrific place to be.

Shannon Guihan: No, absolutely. You can’t, you can’t necessarily think if you’re always trying to convince and articulate the case, um, and selling. 

Rodney Payne: What do you think the shared sort of common understanding is around why sustainability is so important? In the travel industry. 

Shannon Guihan: I might push back a little bit and ask if there is a true shared understanding.

I think at the minute, there’s a lot of talk on sustainability in the travel industry. I think that there are a lot of sort of early movers and destinations that are being progressive and companies that are being creative. Though I wouldn’t say that it is well understood. It is understood that it needs to be understood, but I don’t think everyone’s quite puzzled it out.

Rodney Payne: So people are growing aware that it’s needed, but they haven’t internalized what that really means yet. 

Shannon Guihan: I think so. I think that a lot of times individuals when you talk about sustainability, there’s a, there’s a motivation to say yes, I appreciate it. It’s important to me, though. Is there a motivation to sit down and look at the way of things have been done in business?

In our homes, uh, for convenience, largely, and say, or, or admit where the change, even identify where the change needs to happen. 

Rodney Payne: Let’s talk very quickly about TravCorp and, and the TreadRight Foundation. Can you explain, um, just very briefly your role and how it crosses those two organizations and, and how TreadRight factors in?

Shannon Guihan: Yep. So, my role, um, is Chief Sustainability Officer and Head of Treadwright. So, the Travel Corporation is a group of brands. We span demographics. We are largely tour operating. And in addition to several FIT brands, and we have a global footprint, we are not an insignificant business, all of those businesses contribute to a not for profit foundation that’s based in Switzerland, that not for profit foundation, then, which is the TreadRight Foundation, donates to nature based solutions to the climate for crisis on behalf of The Travel Corporation portfolio business. Meanwhile, I also oversee TTC’s reaction and sustainability at the business. What that means is I oversee goal setting, reporting the development and implementation of our sustainability strategy and the way in which that’s articulated at all of our brands.

Rodney Payne: And in, in recent sort of, I guess it’s, uh, you know, in the last year or two, you’ve, you’ve done a lot of navel gazing around offsetting and, and sort of started exploring, uh, insetting. Can you tell me about your, uh, your work in offsetting the emissions of TravCorp and sort of some of the conclusions or insights you’ve gained from that?

Shannon Guihan: Yeah, absolutely. Absolutely. So we will have gone through a process. Once we figured out the baseline of our carbon footprint, we did engage in offsets, primarily, in fact, only for our radical travel brands, which operates out of Scotland and Contiki. Now, what we were able to do was offer um, it was just for one year off completely carbon neutral trips.

Now, during that year, and this is important, we were going through the process of setting science based targets through the SBTIs. Now, in that process, that process requires rigorous carbon reductions. When you sit back and look at it, and I did spend a lot of time circling the wagons on how does this happen, we’re a travel business, we, you know, Um, we looked at I looked at the purchase of offsets, which may or may not have an effect, um, because it may or may not be a quality project.

Um, and the pricing at the time was. Was moving through some significant changes. You know, we were, we’re a business that needs to forward purchase offsets such that we can secure reliability and, and, you know, the carbon credit brokers were saying we might go up 10, 15, 30 points in it. Well, okay, that’s.

Fine and good. But that’s a difficult way to run a business in partnership with. At the same time, the SBTIs were pushing for significant reductions across scope one, two, and three, of course. And it just, it made sense to me that this money that was going external to the business simply be used internally for reductions at source.

And I say it source somewhat loosely, but for reductions. Um, at the time we were relatively asset heavy. And so for the first two years of the carbon fund, we invested in the fixed assets that we owned, um, in order to make energy reduction and efficiency wins. It was very successful for us. Now that carbon fund is being dedicated towards scope three, absolutely a more difficult proposition, but it enables us to just simply reduce rather than paying somebody else to do hopefully the same thing. 

Rodney Payne: For viewers who may be getting lost in terminology I’m going to try and translate what you’ve just said and that wasn’t clear, simplified in a way that I can get you to confirm that I’m I’m understanding. So you took a percentage of revenue from the two businesses that you mentioned.

And initially you are using offsets that you can purchase from another company, but you changed the way that works to instead use that money to invest in. Electric buses, um, and other things that your business needs. Is that a good understanding? 

Shannon Guihan: Couple of corrections. In short, yes. It’s not a percentage, um, of revenue.

It’s actually a, you can think of it as each brand has, applies a carbon, is, is, is, The head company, we apply a carbon tax to each brand on a per pax basis. That money goes into a central fund that we manage, that we report on annually, and that is dedicated for decarbonization initiatives. A couple great examples, um, uh, electric vehicles, if they were electric vehicles.

Currently viable and or available for our business model would be a great one. They will be soon. Not yet. But HVO fuel or biofuel throughout Europe is a great one. And we’ve invested heavily in that through installing tanks that are depots to supplementing the additional costs that the guest pays the same. But our carbon reductions. Um, are seen. 

Rodney Payne: And so the internal, um, the internal carbon tax calculated at corporate level for all of your subsidiary businesses. Um, can you tell me a little bit about the, um, the process of developing that and how that works in a way that other businesses might be able to learn from that?

Shannon Guihan: The carbon fund. Because nobody likes the word tax, we’ll call it the fund. But anyways, the amount per PAX, initially a basis of it was the amount we were paying for quality offsets. Now we work at scale. So we have a good number of guests coming through at the minute. Our carbon fund is anywhere from 3 to 5 million a year with the view to increase because we have a pretty clear net zero road map as to when and where we’re going to need the most investment later in the decade for, you know, world when that technology becomes available.

Now, keep in mind that carbon reductions are a combination of operating practices. And technology, there’s no one, one source. And so, you know, the, the real first baseline was, well, how much are we playing for offsets? And then we ran a series of exercises on numbers to determine an amount of money that was not punitive on the brands that would not give us, frankly, too little or too much, because in the business environment, I don’t want to just sit on.

I don’t want to say, sorry, I can’t spend it because, because I don’t want to do that. And so, uh, you know, went in with a somewhat. Realistic number that we felt would enable significant reductions yet, um, be palatable, if you will. So there’s, there’s absolutely no science. And this is really important. I was thinking about this earlier today.

Anyone. Businesses response to in setting versus offsetting. The number one thing they need to think of is not, Oh, TTC did this or business X, Y, Z did this. No, it’s your business model. And I think that that’s, um, something that we really need to impress upon because the media doesn’t recognize it. Um, and they’ll take a best practice.

We get best practice for that business. That destination and you know, no two businesses or destinations are the same. 

Rodney Payne: And so let’s unpackage that a little bit more, what do you mean? It’s your business model. Do you mean it’s a unique, uh, that needs to be a uniquely designed program for your business or that there’ll be different outcomes?

Shannon Guihan: I think both. I think that your suite of tactics that you are going to apply to the carbon crisis is going to be unique to your business. And I think that that’s reasonable and fair. A carbon fund, I think, has applicability to most businesses, though what they’re able to do within the sphere of their influence will probably dictate how much they bring in.

Right? Because if they have a limited sphere of influence, why would they want to sit on millions of dollars that they can’t spend for the right reasons? So, you know, I think it’s, again, it’s the suite of tactics that we throw at the challenge. 

Rodney Payne: And did it take much convincing to get your executive team, um, to support the idea of a carbon tax that we’ll call a carbon fund internally?

Shannon Guihan: No, it didn’t. Uh, it didn’t. Are you gonna ask me why? Yeah, okay, so I I sold it as a resilience tactic and I sold it as an opportunity to insulate us from the carbon credit risk and the carbon credit fluctuation in prices Um, I sold it as a way to invest back in our business yet to meet our publicly stated targets Um, and that is just a, the average business person can understand investing in one’s own business to create value long term.

And that’s how I sold it. I sold it on business terms. This is not altruism. And that’s not typically how you get your C suite to listen. 

Rodney Payne: Have you seen, um, co benefits from some of the investments that you made in your own business from that fund? Have there been cost savings? Has there been, um, goodwill?

Has there been some of that resilience or, or good business that you mentioned? 

Shannon Guihan: Not yet, though it’s clear that that’s happening. So, let’s say we’ve received goodwill for our implementation of biofuel HVO, though the costs are fluctuating and they are higher and interestingly income in countries. Some countries in Europe where the cost is the same or lower.

We’re still having a hard time educating suppliers to use it. A little bit of sort of fear. We are going to begin, you know, we’re starting to shift, as I said, our carbon fund really towards scope three and taking a look at some ways to support, um, SMEs throughout our supply chain. So the fact is small to medium sized enterprises, You know, at least last I checked in Canada, it’s about 70 odd percent of the sector, right?

That’s going to be somewhat true across the world. So the way in which we’re envisioning using our carbon fund to support those businesses, absolutely. It’s going to result in a lot of co benefits that I’m excited about. 

Rodney Payne: You mentioned, uh, scope three and shifting your focus from internal investments to investments that help to, to manage your scope three emissions.

Can you explain, um, to people who, who don’t live and breathe the IPCC’s, um, terminology, what do you think of as scope three? How do you assess that? And, um, what are you trying to achieve through those investments? 

Shannon Guihan: Let’s put it this way. We are, if we, if you are a tour operator, it’s everything to do with your trips.

That’s going to be 80 percent of your carbon footprint. Um, for us, it is, you know, our net zero roadmap Towards carbon reductions on scope three is a trip from top to tail. And that’s from pick up to drop off. Every service that you purchase that you have no influence over because you don’t own it is your scope 3. 

Rodney Payne: It’s the lion’s share of travel and tourism. 

Shannon Guihan:  Yeah, and anytime we assess a destination submission, you know, the 80 percent number is always a good guess. It is a big problem for travel because, you know, you’re, you’re a tour business, many destinations, we, uh, depend on people moving on planes and buses to get to us.

Rodney Payne: How are you starting to invest to start to, to reconcile that? 

Shannon Guihan: Yeah. So I’ve, I’ve been a little bit circling the wagons on this one again, because there’s tactics that we can and are employing with respect to greater train travel, um, you know, limiting business travel and pushing train on. So our business air travel in terms of our scope three, and we don’t currently.

I don’t know. I know that probably the immediate term is to invest in SAF and to encourage fewer long haul flights. And this is where the sector needs to start moving, but we’re not there yet in terms of SAF. Um, that’s very In very near terms for us, though. It’s not the solution just like HPO is not the solution Let me be clear.

These are interim steps towards improvements. I think it needs to be recognized Um that you know with a future investment, which is likely into SAF for us You We don’t see that as the, the solution, but yet an interim step. So it is the elephant in the room, our clear reliance, our sectors, clear reliance on jet fuel.

Rodney Payne: Yeah. And so the starting point for you is to focus on your own operations, focus on suppliers and enabling small and medium businesses that you work with, um, to do better in their operations and start looking for solutions to How do you see, um, the elephant in the room around how people get to you? 

Shannon Guihan: It is equally, you know, if you look at our supply chain and the aforementioned fact that they are small enterprises and the fact that they are time poor and resource potentially challenged, my money is better spent on enabling the very easy wins for them.

Out of our scope, three footprint, about 70 percent of it is from surprisingly accommodations. And this is dirty grids and dirty grids is not a difficult problem for us to solve. That’s the real fascinating fact, you know, ground transportation and dirty grids. We’re there. We’re on the way. It just needs money.

So where should my money go? Dirty grids and ground transportation. Now you look at air and it’s run by the biggest businesses in the world. And what are they doing about it? So I can invest in what they ought to be doing. And there’s a likelihood that I will end up supporting some of that, though, you know, in whose court should it lay, it becomes a difficult challenge and I do feel that the, the sort of business tour the travel space. It’s difficult if we remove the onus from airlines on moving more quickly. 

Rodney Payne: Um, at scale for someone who’s spent so many hours doing so much for your organization and paving the way for others when you’re, you have real solutions that you can influence or directly impact. Do you think that we have a responsibility to advocate for quicker R and D in In sort of transportation sectors and aviation.

Shannon Guihan: Do we have a responsibility? Absolutely. I don’t think we have a voice. That’s where I get really distraught. Um, I don’t feel that the sector is really addressed for airlines in the way governments are, um, and that they know we’re beholden to them in in in some respects. And there’s some airlines putting some money into this, thinking creatively, making some pretty bold commitments. As a whole, it’s got to be quicker. 

Rodney Payne: I agree. And I think that’s a really nice note to end on. I really congratulate you in the work that you’ve done to think about internal carbon pricing, whatever we call it. And I think that’s a terrific thing that others can learn from and appreciate you spending some time with us today to talk. 

Shannon Guihan: And thank you, I appreciate you, uh, inviting us and the Travel Corporation to join, so it’s been great.

David Archer: This has been Travel Beyond presented by Destination Think, and you just heard Rodney Payne speaking with Shannon Guihan from the Travel Corporation. For more resources and show notes, visit the blog at DestinationThink. com. This episode was produced and has theme music composed by me, David Archer, Sarah Raymond de Booy is my co producer, Lindsay Payne, Jamie Sterling, and Cory Price provided production support. If you like what you hear, please take a moment to give us a five star rating. It helps more people find our show. And again, I’d also like to thank the nearly 100 destinations that came together to support the 24 Hours of Travel Innovation and 100 Travel Innovations.

Your work is making an impact. So thank you very much. We’ll be back next time. So I’ll talk to you then.