Holiday Inn 2013 Annual Report Download - page 39

Owner proposition
As a result of IHG’s predominantly
franchised and managed business model,
managing relationships with our existing,
new and potential owners is important.
General trading conditions and the
economic outlook also affect the
availability of capital to current and
potential owners. Failure to manage
relationships and the macroeconomic
outlook may have an impact on the
existing IHG System, our operations and
our developmentpipeline.
• To ensure that IHG is continually considering its owners, the IHG Owners Association is
the primary channel through which IHG engages with them. In addition, regional teams
build relationships with owners through a variety of methods, including formal and
informal communications and owner conferences. By agreeing a set of priorities together,
and continually reviewing and updating our central support tools and systems, including
revenue management tools, we aim to offer a compelling owner proposition.
• The use of the System Fund (described on page 16) is also managed by IHG for the benefit
of all our hotels with the objective of driving revenue for them. The use of this fund is
reviewed annually in collaboration with the IHG Owners Association.
• IHG’s scale, diverse portfolio of brands, segments, countries of operation and mix in business
model positions it well from short-term macroeconomic impacts and we continue to monitor
macroeconomic conditions and make necessary adjustments, including cost optimisation
programmes where appropriate. However, we recognise that macroeconomic issues can
impact upon potential and existing owners and we therefore continue to review our business
model and the owner proposition in light of these.
Reputation and brand protection
IHG recognises the importance of its
brands and reputation as important assets
for the business. Protecting them requires
IHG, all those working in our hotels and
corporate offices, owners and business
partners to behave responsibly.
Failure to safeguard the reputation of IHG
and its brands could have severe impacts
on the Group’s future performance.
There is also a constant need to protect
the safety and security of our guests,
employees and visitors.
• Responsible business underpins our strategy, by being an essential part of Disciplined
Execution. Our Business Reputation and Responsibility function comprises a team
of lawyers, brand standard compliance managers, chartered secretaries, corporate
responsibility specialists, risk managers and internal auditors who work together to
champion and protect the trusted reputation of IHG and its brands, including brand and
intellectual property protection.
• IHG aims to embed a responsible business culture throughout the organisation, leveraging
our Winning Ways (see page 21) to encourage those working at IHG to promote and protect our
trusted reputation. To assist with this, we have in place various internal programmes, policies
and training, including our Code of Conduct.
• IHG’s proactive risk-based approach to hotel safety and security (summarised on page 35)
aims to ensure guest and employee safety and the security of hotels and office buildings.
IHG has also put in place a crisis management programme to ensure our hotels and corporate
offices are prepared for unexpected or unknown events.
Risk description Control and mitigation activities
Strategic Report 37
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