SBN’s report, Sustainability in Aotearoa New Zealand’s Corporates, examines the prioritisation of sustainability and is based on insights gathered from interviews with senior executives from almost 30 organisations.
Sustainability was a key focus for almost all the organisations interviewed. It has retained or even increased its importance, during a turbulent period. The corporates interviewed confirmed their ongoing focus on sustainability over the next 18 months.
Report author and SBN’s Head of Advisory and Impact Tori Calver says the primary drivers for sustainability action were market pressure and regulation.
“Organisations exporting to Europe are seeing strong pressure to prioritise action in emissions reduction,” she says. “Plus, new regulations like the Climate-related Disclosures, which makes it mandatory for big companies to report on climate risk, are having an impact.”
Another factor driving the growing focus on sustainability is the increasing expectation from customers and investors for products and services that are more sustainable.
“Some businesses see sustainability as a competitive advantage, while others have noticed an increase in job seekers wanting to work for purpose-driven companies,” she says.
The main areas corporates are focusing on include climate action, circular economy practices (such as waste reduction) and supply chain sustainability. Other topics include water management, employee engagement and indigenous partnerships. An area of emerging interest is the impact of businesses on nature.
Despite this growing focus on sustainability in corporates, it remains secondary to profitability. The pace and ambition of change is likely to be impacted by signals and investment from government.
“Our findings show that while corporates are committed to sustainability, greater intervention from government would help. That includes clearer and more consistent regulations to help long-term planning; greater standardisation of regulations between New Zealand and the global market, particularly around climate and nature reporting; and financial support and incentives for sustainability initiatives, such as transitioning to renewable energy or electrifying vehicle fleets.”
She says the main challenges identified by interviewees were global supply chain disruptions, regulatory uncertainty, difficulty obtaining insurance, cost and shifting behaviour. A number of organisations were cautious about what they state publicly due to increasing concern around being called out for greenwashing.
“While it’s encouraging to hear that corporates are optimistic, more work needs to be done. For example, although most companies have clear emission reduction targets, many lack credible plans to meet them. We are sceptical that business is on track to meet Aotearoa New Zealand’s targets for emission reductions of 40-50% by 2030 and net zero by 2050.”
The businesses interviewed for this survey were all members of the Sustainable Business Network. They come from a variety of sectors including primary industry, financial services, transport, manufacturing and construction. The interviews took place in September and October 2023.
The research was supported by the Ministry of Business, Innovation and Employment.
Download the Pulse Report: Sustainability in Aotearoa New Zealand’s Corporates.