Why Airbnb’s Community Compact is Important

In a blog post yesterday, Airbnb CEO Brian Chesky released the Airbnb Community Compactoutlining three “community commitments.” To summarize, the commitments boil down to Airbnb: 1) paying its fair share in taxes, 2) sharing appropriate data with municipalities, 3) educating its users on regulations and policies. The release demonstrates a critical inflection point for Airbnb’s policy efforts.

TechCrunch ran this headline: “Airbnb Pledges Transparency, Education to Fight Commercial Hosting, But Provides Little Detail” – and it’s true, the high-level document was only three-and-a-half pages. The article also quotes two little gems from New York State Attorney General Eric Schneiderman:

Eric Schneiderman, the New York State attorney general who subpoenaed financial data on hosts last year, called today’s statement a “transparent ploy by Airbnb to act like a good corporate citizen when it is anything but.” He added, “The company has all of the information and tools it needs to clean up its act. Until it does, no one should take this press release seriously.”

That’s harsh language, for sure. There’s a lot of history between the New York AG and Airbnb. But it’s all irrelevant. The audience for this compact isn’t the New York AG, nor was it the public. It is a clear message to municipal executives and legislators: we want to partner with you – and here are some ways we can start right now.

Releasing a compact like this publicly rather than communicating it directly to municipalities is all about signaling. It demonstrates a public commitment which Airbnb executives and public policy leaders can use as its foundation in discussions with municipal leaders. 

The fact that it was short on details is important – there’s no one-size-fits-all-approach to each municipality’s needs. Different cities have different priorities – they can range from promoting affordable housing to improving property values to making the city more attractive to tourism and convention business. In any case, Airbnb has the capability to craft unique partnerships with each city – partnerships and agreements that can only come through discussions with each municipality. It would be a folly to release a detailed document that doesn’t take into account each individual market’s needs – executives, legislators, and community groups would react poorly to say the least.

So what’s next for Airbnb? After a commitment to partnering with cities, the next logical step is to start working with civic and community leaders in a few municipalities to establish priorities, identify opportunities, and negotiate agreements. Then, through legislation, they’ll formalize the regulations and policies. It’ll be interesting to watch how they’ll go about formalizing these agreements – in the past, some organizations have gone so far as developing community benefits agreements or memorandums of understanding – some of which have carry enforcement weight than others. But the fact that this compact is publicly released – a move that many other sharing economy firms have not taken – shows that Airbnb is serious about creating a scalable model to usher in partnerships with municipalities.

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