Managing the shared accommodation industry ethical dilemmas : The case of Cape Town and eThekwini’s competing multi-stakeholder interests

Abstract

Municipalities face a variety of issues, including the need to reconcile the competing interests of many stakeholders as their jurisdictions expand. This is particularly true as municipalities have emerged as fertile spaces for digital platforms and the growing popularity of the sharing economy around the world. Platform enterprises in the shared accommodation industry have altered society’s approach to formal paid accommodation. Some of these changes have had mixed results, posing ethical challenges for municipalities. The governance of the shared accommodation industry (hereafter SAI) and the ethical dilemmas arising from the competing interests of multiple stakeholders have been studied. Using a qualitative multiple case study on the cities of Cape Town and eThekwini municipalities, the study investigated and explored how municipalities manage the ethical dilemmas arising from the competing multi-stakeholder interests in governing the SAI. Semi-structured interviews and field observations were used to collect data. Secondary data from case study documents, including strategic plans, annual reports and media releases, were used to supplement the obtained data. Firstly, the study revealed that the SAI's competing interests in both municipalities stem from licenced accommodation operators and communities. Since shared accommodation enterprises, primarily private homes, charge lower prices due to lower cost structures, they compete for clients with licensed accommodation operators. Communities, like licensed accommodation operators, compete with shared accommodation enterprises for affordable housing and access to municipal services and infrastructure. Secondly, both municipalities face economic ethical dilemmas like gentrification, densification, and the perpetuation of inequality, job losses and worker exploitation. Homelessness and unaffordable housing are amongst the social concerns, as are overpopulation, safety, loss of privacy and neighbourliness, and traffic congestion. Pollution, water scarcity and energy, and environmental degradation are among the environmental concerns. Thirdly, neither municipality possesses the skills and knowledge required to manage the shared accommodation industry. They use the laissez-faire strategy, with a reliance on body corporates and whistle-blowers to enforce existing laws while updating themselves on lessons learned.