Hotel operator Accor has set up a €70M fund for employees that will be paid for with 25 per cent of the Group’s planned dividend.
Coming amongst an abrupt deterioration in its position due to the devastating effects of the coronavirus, the company has decided to take drastic measures now across its global operations. These have included: a travel ban, hiring freeze, reduced schedules and /or furloughing for 75 per cent of global head office teams in the second quarter, resulting in a minimum €60M reduction in G&A for 2020 and reviewing recurring investment plan for 2020 resulting in a €60M reduction in capital expenditures.
The board had also decided to withdraw its proposal for a 2019 dividend payment of around €280M and after consulting with the main shareholders – JinJiang International, Qatar Investment Authority, Kingdom Holding Company and Harris Associates – had decided to allocate 25 per cent of the planned dividend to the launch of the ALL Heartist Fund. This fund will 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, as well as furloughed employees suffering “great financial distress” and individual partners facing financial difficulty. In addition, the group said it would support front-line healthcare professionals and non-profit organisations.
Sébastien Bazin, Chairman & CEO, Accor, said: “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.”
