Accor Group has announced post-crisis recovery measures amid the global battle against the coronavirus pandemic and its impact on hospitality worldwide.
After consulting with the Group’s main shareholders, JinJiang International, Qatar Investment Authority, Kingdom Holding Company and Harris Associates, Accor has decided to allocate 25% of the planned dividend (€70m) to the launch of the “ALL Heartist Fund”, a COVID-19 special-purpose vehicle.
The fund will typically assist the Group’s 300,000 employees, pledging to pay for their COVID-19-related hospital expenses, for those who do not have social security or medical insurance.
Moreover, on a case by case basis, furloughed employees suffering great financial distress and individual partners facing financial difficulty.
This decision has received unanimous support from the Board members, who collectively decided to reduce their attendance fees by 20% to the benefit of the “ALL Heartist Fund”. Additionally, Sebastien Bazin, chairman and CEO of Accor, will forego 25% of his compensation during the crisis. The cash equivalent will also be contributed to the Fund.
This “ALL Heartist Fund” complements some of the initiatives which have been spearheaded by a number of hotels throughout the Middle East & Africa, including a collaboration with partner RISMA in Morocco resulting in over 500 rooms provided to front-line medical professionals.
Moreover, following a training by the government in sanitation processes, the Mövenpick Aswan team now assists in sanitizing schools, nurseries, Mosques, churches and more than 700 houses within their community. At the Sofitel Luxor Winter Palace, the team prepares and distributes meals daily to medical teams assisting quarantined patients. Lastly, reinforcing proper hygiene and sanitation during this time, bars of soaps and recycled soaps are widely distributed by Pullman Dakar and Mövenpick Nairobi to various community groups.
“Welcoming, protecting and taking care of others is at the very heart of what we do. In light of the urgency and the scale of the situation, we have decided to act in an immediate and meaningful way, in the spirit of our values and commitments. Through this impactful gesture, we wish to express our solidarity and gratitude to all those demonstrating courage and selflessness during this crisis,” says Bazin.
“On behalf of the Board, I would like to thank the Group’s main shareholders. Without them, the “ALL Heartist Fund” would not have been possible. I also want to pay a special tribute to the Accor teams around the world. They are facing the current crisis with admirable courage, dedication and professionalism. As our industry is going through tough times, we have to make tough decisions, but Accor has a strong balance sheet which will enable it to withstand this crisis and emerge with strength during the recovery period. I am confident that Accor will soon rediscover the road to growth.”
Moreover, mitigation measures were implemented as early as February, and included a travel ban, hiring freeze, reduced schedules and /or furloughing for 75% of global head office teams for Q2, resulting in a minimum €60m reduction in G&A for 2020. The group also reviewed its recurring investment plan for 2020 resulting in a €60m reduction in capital expenditures.
Accor is further streamlining all other costs (e.g. sales, marketing, IT), in line with lower system-wide revenues.
