Material Flow Cost Accounting and ESG Compliance: A Tool for Sustainable Hospitality Operations in South Africa

Environmental, Social, and Governance (ESG) compliance is increasingly central to hospitality businesses as sustainability expectations rise globally. MFCA, a core Environmental Management Accounting (EMA) tool, enables organisations to identify and reduce material and energy inefficiencies. Guided by Ecological Modernisation Theory (EMT), this study adopts a qualitative, case-based methodology, using 2023 ESG reports from Marriott International, Hilton Worldwide, and Southern Sun. This paper explores how Material Flow Cost Accounting (MFCA) principles are reflected in the ESG disclosures of major hotel groups and how these practices support sustainable operations, particularly in the South African context. The analysis considers GRI-aligned reporting standards to evaluate how MFCA-related indicators such as food waste, energy use, and water efficiency are disclosed in practice. Findings reveal that while MFCA is not explicitly adopted, its principles, such as cost-linked resource tracking and performance transparency, are embedded in hospitality sustainability strategies. Hilton achieved a 62% reduction in food waste through digital tracking initiatives, while Marriott and Southern Sun reported measurable improvements in energy and water use. These results affirm MFCA’s relevance as a bridge between sustainability performance and ESG reporting. The study recommends expanding MFCA-oriented training, strengthening ESG reporting frameworks, and encouraging policy incentives for formal environmental cost accounting adoption in the hospitality sector.