At the end of June, we attended Arena’s most recent event – ‘The Road To Net Zero’ which looked at hospitality’s complex relationship with sustainability, building upon the findings and updating the annual insights and attitudes from last year’s session.

The day opened with an engaging session ‘Creating a Sustainable Future in an Unstable Now’ from Reuben Pullan, Senior Insight Consultant at CGA by NIQ, who began by laying out the hospitality landscape.

The scene was set with a market outlook shaped by instability. Whilst the decline in business confidence halted in May, levels remain low with around just one third of business leaders being optimistic about their own business, and just 15% are optimistic about the general market. On the other hand, consumer confidence has held steadier and even begun to recover, suggesting that whilst operators remain cautious, consumers may be feeling more optimistic about their spending power.

With sites numbers flat (+0.1%) year-on-year across the market, bars are the only sector to show five-year growth, with hotels, restaurants and food-led pubs showing the greatest decrease.

With revenues stagnating and more businesses reporting declining margins instead of growth, like-for-like growth has flattened in 2025. Increasing costs from wages, ingredients, rent and energy are squeezing profits, with 31% of business reporting decreasing profits in Q1 2025. Wage inflation is the standout pressure point (91% report this as a top concern for the next 12 months), outpacing already-eased costs like energy (33%) and rent costs (23%). Over half (59%) of operators now have less than six months’ reserves, curbing their ability to invest beyond the day-to-day.

When asked about business challenges for the next 12 months, sustainability has dropped vs. last year, with just 14% of leaders ranking it as a top business concern. Interestingly, independents are now more likely than large operators to cite sustainability as a concern. This perhaps reflects the impact of rising costs on larger payrolls, or that autonomous smaller businesses may prioritise longer-term goals. As worded by Reuben: “Operators aren’t stepping back from sustainability because they don’t care. It’s because they feel they can’t afford to.”

Operators’ top asks from suppliers have changed: whilst competitive pricing remains a top priority, along with event support and financial investment at the top of the list. However, sustainability support has fallen to the bottom. Reuben noted that this doesn’t necessarily reflect disinterest, it may simply be that suppliers have already delivered in this area, or that operators feel they can’t afford to prioritise it right now.

Areas like staff training and marketing, however, present immediate opportunities for suppliers to add value and help operators trade more efficiently.

A standout part of the presentation was Reuben’s updated consumer segmentation model, which is key to understanding purchase decisions, sustainability expectations, and the potential impact on brand loyalty and spend. They were split into:

  • Pessimists (25%) – Value driven and dismissive of change unless convinced or coerced.
  • Opportunists (6%) – Green when it benefits them personally.
  • Sceptics (39%) – Lack trust in the system and find it hard to believe individuals can make a difference.
  • Activists (32%) – Want access to sustainable options, don’t need convincing.

Activists offer the most commercial opportunity as they eat out more, spend more, and are highly brand-loyal. Sceptics, whilst harder to convince, represent a significant portion of the market with strong spend potential – if their trust can be earned.

For many consumers, sustainability is now a proxy for brand credibility, and it’s not just about a brand’s carbon footprint but about the message it sends to your customers. When expectations on sustainability aren’t met, especially if claims are inauthentic, it can reduce trust significantly and quickly, with customers being less likely to engage with the brand in future.

So, while sustainability may be sliding down the priority list, it remains central to consumer values and long-term brand success. Whilst we are seeing tough times in the market, hospitality has always managed overcome challenges. So, when financial pressure lifts, those who’ve built real credibility through their sustainability policies and gained trust with consumers will be best placed to lead the next phase of sustainable transformation.

A huge thank you to Arena for hosting a fantastic, thought-provoking day and to Reuben and the CGA team for sharing such valuable insights.

To see how jellybean is approaching sustainability, visit: https://www.jellybeancreative.co.uk/environmental-social-governance-policy/

Emma Langley
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