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Sus tain ability Report 2019
He waka eke noa We are all on this journey together
Intro 01 02
01 Letter from the CEO 09 Engaging Air New Zealanders 23 Tackling climate change & carbon
03 Letter from the Sustainability Advisory Panel Chair 12 Embracing diversity 25 Reducing our carbon footprint
05 Our business 13 Gender balance 29 Meeting regulatory obligations
06 Our customers 15 Developing Māori and Pasifika leaders 30 Supporting the Zero Carbon Bill
07 Sustainability at Air New Zealand 17 Building a strong learning culture 31 FlyNeutral
08 Our material issues 19 Protecting our people's wellbeing
21 Community engagement
03 04 05
33 Supporting New Zealand 43 Working with our suppliers 49 Reducing waste & plastic
through sustainable tourism 45 Our approach 51 Plastic, not so fantastic
35 Working together to promote New Zealand to the world 46 Recognising our suppliers 52 Re-evaluating our waste targets
38 Showcasing the best of regional New Zealand 47 A taste of New Zealand 53 Working with partners to reduce waste
39 Supporting tourism and development in the regions
41 Tourism's role in protecting our environment
55 Dashboards
1 | Sustainability Report 2019 | Introduction He waka eke noa | 2
A LET T E R F R OM
The Chief
Executive Officer
We stand at a pivotal moment that climate change poses and the need upon businesses that they stand up like to stimulate economic and social impact
for urgent action. Countries are crystallising never before to be a trustworthy source of in the regions by promoting tourism career
in time with a groundswell targets and enshrining mechanisms in information, to take a stand on contentious pathways for young people who would not
of sustainability awareness legislation to deliver to the 2050 Paris societal issues and help deliver a fairer, safer otherwise access tertiary training.
demanding that business, targets. The New Zealand Government is and more resilient society. People are at the
seeking to pass the Zero Carbon Bill to heart of Air New Zealand so I’m really proud I’m incredibly proud of what we’ve
governments and establish long-term emissions budgets. that we have led national conversations collectively achieved at Air New Zealand
communities together do As a founding member of the New Zealand around important social issues such as in the past seven years during my tenure
Climate Leaders Coalition, Air New Zealand diversity and inclusion, automation and as CEO, and our sustainability journey
more to play their part in has supported the net-zero ambition and the future of work. Within Air New Zealand, has been absolutely one of the highlights.
responding to the climate seeks enhanced policy certainty and the the proportion of women in our Senior My appreciation again goes to the Air
crisis and other critical design of new mechanisms to support Leadership Team roles has jumped from New Zealand Board and members of
low-carbon technology, particularly for 16 percent in 2013 to 44 percent this year, Sustainability Advisory Panel for their
sustainability challenges. hard-to-abate sectors like aviation. we have advanced a leading parental leave continued guidance and the challenges
policy and we continue to embrace te reo they have set, and to our partners who
The immense challenges we face underscore Globally, consumer awareness of the Māori. Our progress has been recognised are working alongside us to deliver results.
the relevance of Air New Zealand’s company negative carbon impacts of flying is rising. externally, securing the inaugural Diversity When Air New Zealand first launched
purpose, to supercharge New Zealand’s Responding to the climate crisis remains Air & Inclusion Award from the International our sustainability agenda, not many New
success — socially, environmentally and New Zealand’s single biggest sustainability Air Transport Association and winning New Zealand companies, and certainly not
economically. This purpose reflects the challenge. The most impactful lever we have Zealand’s Most Attractive Employer award many airlines, were so “all in”. I’m
critical and multifaceted roles we play — currently is to fly modern, more fuel-efficient for the sixth time. These awards are great therefore grateful for the support and
connecting people and products across aircraft, which we continue to invest in, and recognition, but the bigger prize is the trust the Air New Zealand Executive and
New Zealand and the world, supporting to ensure our operations both in the air and difference I see in employee satisfaction Board had to launch and take this critical
people and communities as one of on the ground are as efficient as possible. and improved business performance. strategy forward.
New Zealand’s largest employers, and
leading a conversation on the future of To make lasting and significant progress
sustainable tourism, New Zealand’s
largest contributor to GDP. Our company This year the Air New Zealand Executive identified to address the biggest of the world’s
'Sustainability in the Bloodstream' as a long-term
challenges — and there are many —
purpose also reflects the airline’s role in business must continue to step up and
helping to protect the natural environment
organisation-wide strategic pillar.
mobilise their people, knowledge and
for Kiwis and visitors alike, and the capital. Ultimately, we will get the future
desire that our workplaces offer equal we design and are prepared to invest in
opportunities irrespective of gender, race, together — and our people, communities,
sexual orientation or physical ability. We also know that new fuels and electric Our unique position as the national carrier long-term resilience as a business,
aircraft technology must form part of of Aotearoa extends to the positive impact and health of our planet depend on our
This year the Air New Zealand Executive the longer-term solution for reducing we have on New Zealand economically — collective and continued bold leadership.
identified ‘Sustainability in the Bloodstream’ emissions. In the past year we are proud bringing overseas visitors to our shores,
as a long-term organisation-wide strategic that our voluntary customer carbon offset transporting high-value cargo exports, Nāku noa, nā
pillar. This commitment will accelerate programme passed a milestone of $1 million stimulating regional economies and
progress towards our sustainability goals going towards the purchase of carbon supporting local businesses across our
with an additional focus on enhancing offsets from permanent New Zealand forests. supply chain. At our inaugural Tūhono Ngā mihi,
awareness and capability of all senior Supplier Awards, we celebrated the
leaders to deliver our ambitious agenda. This past year has also seen continued low contribution of many of our suppliers to
levels of trust globally in governments, our own business success. In the regional
In 2019 the climate crisis has taken centre NGOs and media. In the trust stakes, “my impact and tourism space, we recently
stage. We have seen unprecedented employer” is the most trusted relationship announced a four-year strategic partnership Christopher Luxon
engagement of community and youth by a significant margin. With such trust with Queenstown Resort College’s Tai Chief Executive Officer,
leaders shining a light on the challenges comes responsibility — the expectation Tokerau campus. This partnership aims Air New Zealand
3 | Sustainability Report 2019 | Introduction He waka eke noa | 4
A L E T TER FROM THE
Sustainability
Advisory
Panel Chair
Although there are lots of success by addressing whatever key
companies today that talk challenges that company may be facing —
in Air New Zealand’s case, Climate Change,
a lot about corporate Tourism (Sections Two and Three), and
sustainability (or Corporate getting on top of its waste management
issues, with a particular focus these days
Social Responsibility), very on plastic waste (Section Five) — where
few of them really get it. Air New Zealand has a good story to tell
Worse yet, a lot of them are (see page 49).
still just ‘adding it on’ to the Get all that right, and suppliers (Section Four)
‘shareholder-first imperative’. will be proud to help that company achieve
its goals. At which point, investors will be
Paradoxically, there’s a strong case to be assured of good returns, in both the short
made that the best way of putting and the long term, as a direct consequence
shareholders first is to put shareholders last! of getting the basics right everywhere else
And the structure of this report perfectly in the company.
exemplifies that heretical idea. Corporate
sustainability for Air New Zealand starts With an airline, inevitably, investors will be
with Air New Zealanders (Section One) — the particularly keen to know that its Board
heart and soul of the company. As it is for of Directors is managing climate risk as somewhere in the world. In fact, the UN to understand the psychological trauma broader community engagement strategy
every company. Screw this up, or even play it purposefully as is now required at a time tells us that we’re now witnessing one such of leaving behind one’s homeland, culture, which has moved forward in leaps and
down, and that’s pretty much game over for of climate emergency. My colleague Tim calamity every week, and that this will get history and very identity as a people. bounds over the last 18 months.
any company seeking genuine sustainability. Jackson spells that out very clearly on much worse with sea levels starting to
rise much faster, and a deeply disturbing New Zealand’s leadership on climate The world already looks to New Zealand (and
projection of a one metre average sea-level change (as well as that of Fiji itself) is going to its national carrier) for leadership in such
At long last, there is now a much greater recognition of rise by the end of the century. to be crucial over the next few years. The troubled times. Lending real substance to the
phrase ‘he waka eke noa’ takes on an extra principle of Tūhono — standing together —
both the scale and the urgency of the climate crisis. For many people in the Pacific, that’s the resonance in that regard (‘we’re all in the will set the benchmark for others to aspire to.
equivalent of their countries being put on same boat’ seems insipid by comparison!),
death row. Kiribati (home to 100,000 people reminding us not just that we have to plan
Get it right, and that goes a long, long way page 32. In that regard, the decision by on 33 islands) has for a long time been the and implement a very rapid transition to a
in terms of securing customer loyalty and Air New Zealand’s Board to sign up to poster child for all small island states in this low-carbon world, but that we have to do
attracting new customers. the requirements of the Task Force on region, given that most of Kiribati is only it in a fair, just and accountable way. Air New
Climate-related Financial Disclosures is just above sea level and is already Zealand has an important part to play in
That kind of loyalty depends completely particularly encouraging (see page 23). disappearing. Back in 2014, former President that regard, empowering its own Māori and
on trust, and that kind of trust depends in Anote Tong had the foresight to purchase Pasifika employees, and thinking even more Sir Jonathon Porritt
part on having the right strategic partners, This last year has been dreadful, with 6,000 hectares on Vanua Levu, Fiji’s second dynamically about its role in South Auckland Founder Director, Forum for the Future
prepared to co-create future commercial one extreme weather event after another largest island — but it’s still hard for people — as a critically important element in a September 2019
5 | Sustainability Report 2019 | Introduction He waka eke noa | 6
Our business Our customers
Air New Zealand operates Our domestic network is unmatched, We believe our success Air New Zealand connects six million customers to over 30 international The power of consumers to influence change
a global network, with a offering services to 20 main centres
is inextricably linked to the New Zealanders to each other destinations. We also operate one of the most
connected 1 domestic networks in the world
in the world, particularly around sustainability
issues, has increased significantly in recent
Pacific Rim focus, that
and regions across New Zealand, while
our alliance relationships with airlines in
success of New Zealand and with the world. We take with more than 30,000 customers travelling
on more than 400 flights each day between
years. Social media has made it much
provides passenger and key offshore markets complement the our responsibilities to our easier for like-minded groups to advocate
cargo services to, from, destinations we fly to. With more than 3.2 and this is reflected in customers very seriously. 20 domestic destinations. for environmental and social advances. This
our company purpose:
million members, our Airpoints™ programme makes it even more important for us to give
and within New Zealand is considered the most valuable loyalty Whether we are helping We carried more than 180,000 tonnes of our customers a voice and to listen.
to more than 17 million programme in New Zealand. We have a friends and family to connect, cargo on our network in the past 12 months,
proven history of achieving profitability, Supercharge New supporting New Zealand businesses and Customers can make a difference by
customers a year. bringing tourists to New
delivering positive earnings every year
since 2003 and paying dividends to our Zealand’s success — Zealand or taking exports to
facilitating urgent movements of medical and
infrastructure supplies. For a small island
choosing to fly with airlines that are making
significant positive change and they can take
shareholders every year since 2005.
socially, environmentally the world, customers are at nation in the Pacific, air travel provides a
vital connection to the rest of the world.
action by offsetting the carbon emissions
from their flights. In the past year more of
and economically. the very core of why we There are many economic and social benefits our retail customers around the world chose
do what we do. to travel, connecting people with friends to offset some or all of their carbon emissions,
and family, providing exposure to different offsetting close to 45,000 tonnes of carbon
If we can make their experience safer, better, cultures and experiences, and facilitating emissions from more than 183,000 journeys
with less impact on the environment, and get tourism and trade. — a 41 percent increase on the previous
them where they need to be, when they need year (albeit still a low percentage of bookings
to be there, we have succeeded. Consumers in New Zealand and around overall). We also introduced offsetting for our
the world are increasingly concerned with corporate and government customers, with
The number of customers flying on our how the industry can provide these more than 7,000 tonnes of carbon emissions
network continues to grow. In the last year, benefits at the same time as reducing the offset in the inaugural year of the programme.
Air New Zealand flew more than 17 million negative environmental impact of aviation.
customers on more than 190,000 flights. This is another area where we need to
Our international flights carried more than work together.
#1 17.7M 190K+ 3.2M 38,600 tonnes
Eco-Airline Corporate reputation in Passengers carried in Air New Zealand flights Number of Airpoints™ members, Annual volume of New Zealand exports
of the Year 1 New Zealand and Australia 2 2019 financial year in 2019 financial year up 11% from the prior year carried on Air New Zealand
$128M 20 32 12,553 2.38M 2.84M 2018 3.08M 2019
Dividend paid to the New Domestic International Employees at end of June 2019 Total number of social media fans 1
Zealand government in 2019 ³ destinations destinations 4
7 | Sustainability Report 2019 | Introduction He waka eke noa | 8
Sustainability at Our material
Air New Zealand issues for 2019
Our purpose is to supercharge We have identified nine SDGs that we have Sustainability By continually assessing We engage with a wide range of stakeholders In this report we focus
the greatest ability to positively impact. internally and externally to understand
New Zealand's success — Advisory Panel which issues are most on the following issues:
We have a four-member Sustainability what is important to them. 1 We listen to
socially, environmentally Executive Steering Group comprising our material to our operations, the feedback from our employees, customers,
and economically. Our Executives responsible for Strategy, Our Sustainability Advisory Panel brings environment, our customers investors, suppliers, industry partners and 01 Engaging Air New Zealanders
Networks and Alliances, Ground Operations, together an internationally renowned group of communities. We receive input and guidance
Sustainability Framework Marketing and Customer, and Operations experts selected for their skills, expertise and and other stakeholders, Air from throughout the organisation — from 02 Tackling climate change
helps guide our actions and Integrity and Standards. This group steers ability to challenge our sustainability agenda. New Zealand is better able our Board of Directors and Executive to & carbon
our sustainability agenda and drives Six external members, Dame Anne Salmond, our passionate employees sharing their
is aligned with the United Sir Rob Fenwick, Dr Susanne Becken,
to mitigate risk and harness 03 Supporting New Zealand
change through their respective parts of aspirations for change.
Nations Sustainable the business. Dr Suzi Kerr, Professor Tim Jackson and opportunities. Our material through sustainable tourism
Development Goals (SDGs), Chair Sir Jonathon Porritt are joined by our issues inform our strategic Our Sustainability Executive Steering Group
Internally we use an online sustainability Chief Executive and Chief Strategy, Networks regularly reviews the risks identified in 04 Working with our suppliers
the blueprint to create a dashboard to regularly monitor and track and Alliances Officers. priorities, sustainability our Enterprise Risk Process and annual
better and more sustainable performance against targets in each of our approach and reporting. and long-term planning cycles, while the 05 Reducing waste & plastic
framework areas. The Panel and other company Sustainability Advisory Panel provide a vital
future for all. representatives meet twice a year to discuss external reality check.
progress, identify emerging issues and
develop responses. The Panel are also
consulted on issues identified outside of the
regular meetings.
Sustainability
Framework
Manaakitanga
Our people
Air New Zealanders
Communities
Kaitiakitanga
Our place
Carbon
Nature & Science
Ōhanga Ora
Our economy
Tourism
Trade & Enterprise
01 Engaging
S PLI T O F ALL EM PLOYEES
%
43
Air New Male Female
Zealanders FEM ALE S EN I O R LE AD ERS H I P
As an airline, we They trust they are getting on
a well-maintained aircraft with a
We are consistently ranked as
one of New Zealand’s most
30% 39% 39% 44%
distinguish ourselves
crew that will get them safely to attractive employers, taking the
through the personal their destination. And when things top spot in the annual Randstad 2016 2017 2018 2019
connections our go wrong and disruptions happen, Employer Brand Research
they rely on our customer care Awards a record six times. This
people make with teams truly caring and helping to success is highlighted when it
customers each get them moving again. comes to recruitment. In 2019 we
received 40,470 job applications EM PLOYEE AS S I S TAN CE PRO GR AM M E (E AP) CAS ES
day. Our customers
choose to fly with us
To deliver on this we need to — more than three times the
attract and retain the best people number of our total workforce.
because they know and ensure they have the right
leadership, training and support to We work hard to ensure the 9.3% average utilisation rate - 2019 1
they will be greeted perform their roles to the highest perception of Air New Zealand
at the airport and the
aircraft door with a
warm smile and a
standard. Collectively, passionate
and inspired Air New Zealanders
are our greatest strength.
as a great employer meets the
reality of the employee experience
once on board. Your Voice, our
bi-annual employee engagement
1,157
2016 2017 2018 2019
welcoming kia ora. survey, helps us identify what's
working well and what we need to
improve. Our 2018 engagement
score was 71 percent 1 which
places us in the top quartile of EM PLOYEE N E T WO RKS I N O PER AT I O N
organisations in Australia and
New Zealand.
1 Women’s
Network 2 Māori and Pacific Islands
Manu Network 3 Kiwi Asia
Network 4 Pride
Network
5 Enable
Network 6 Young Professionals
Network 7 Ex-Services
Network
MĀO R I & PAS I F I K A I N M ANAGEM EN T D IVERS I T Y & I N CLU S I O N
Proportion of Māori & Pasifika
% %
13 15
External accreditation ticks
in management positions received since 1 July 2018
throughout the organisation
in 2019 ²
2018 2019
11 | Sustainability Report 2019 | Engaging Air New Zealanders He waka eke noa | 12
01
Embracing
diversity
Our vision is to create a diverse workforce, proudly
representative of Aotearoa, a place where Air New Zealanders
can be themselves and thrive. With more than 200 different
ethnicities calling Aotearoa home, New Zealand is a culturally
diverse country and getting more so all the time.
Reflecting the country’s rich diversity is We have enhanced our people policies to
what sets us apart as an airline, leading to better reflect an inclusive and fair workplace
a stronger connection with our breadth of and to strengthen our position as an
customers and in turn driving better employer of choice. For example, we have
business results. significantly enhanced our Parental Leave
package, acknowledging the importance of
We were proud to be awarded the inaugural this stage in our people's lives and providing
Diversity & Inclusion Team Award at the greater financial security for new parents.
2019 International Air Transport Association
We have seven active
(IATA) Annual General Meeting. The award
recognised Air New Zealand as leading the
way for diversity and inclusion in the global
aviation industry. employee networks, each
We have seven active employee networks,
sponsored by a member
each sponsored by a member of the of the Executive, which
connect, support and
Executive, which connect, support and give
voice to all employees. These employee
give voice to all employees.
networks are a driving force in creating
an inclusive workplace and have been
instrumental in Air New Zealand receiving
the Gender, Rainbow and Accessibility Tick
accreditations, which provide independent Related to this, we actively promote flexible
validation that people of all genders, sexual working arrangements where possible, giving
identity and abilities respectively are employees greater control over how they
accepted and valued in our workplace. structure their work and personal life. Working
with the White Ribbon Trust, we are also
In 2018 we introduced an unconscious taking a strong stand against domestic abuse
knowledge and bias awareness programme with a new initiative that includes training,
to help employees understand how internal and external support options, and up
personal bias affects decision-making. This to 15 days' paid leave.
programme has been immensely popular,
and so far 733 employees have completed
the training. By June 2019, 63 percent of our
Senior Leadership Team had completed the
programme, on track to meet our target of
80 percent by 2020.
13 | Sustainability Report 2019 | Engaging Air New Zealanders He waka eke noa | 14
01 C A SE ST U D Y
Gender
International Women
in Engineering Day
Three employee-led Air New Zealand groups
are making it their business to increase the
balance number of women participating in STEM 1
careers in aviation. Women Inspiring the Next
Generation of Pilots, Women in Engineering
and Women in Digital are working alongside
schools and community groups to promote
career pathways for women in aviation.
The networks host groups of young women
at Air New Zealand to experience a day
We see gender diversity at all levels as a business imperative. in the life of a pilot, engineer or a member
It’s good for culture, innovation, customer connections and of our Digital team. They also participate
in programmes such as Shadowtech,
the bottom line. Regardless of whether on the ground or in providing leadership shadowing and work
the air, we’re working hard to create a culture that empowers, experience for female digital students in
attracts, recognises, develops and engages women. partnership with the Manukau Institute of
Technology, and events such as the
Classic Fighters Airshow in Blenheim and
In the last year our Executive Team has Through our ongoing partnership with Global Wings over Wairarapa in Masterton.
been strengthened by the addition of two Women and its Champions for Change
exceptional leaders: Carrie Hurihanganui, initiative, we have increased external
who re-joined the airline in July 2018 as female development opportunities aimed
Chief Ground Operations Officer, and in May at mid-manager level. In the past year, two
2019 Jennifer Sepull took up the role of Chief of our high-potential leaders have become
Digital Officer. At the end of the 2019 financial members of the International Women’s Forum
year, 43 percent of the Air New Zealand Fellows Program, gaining customised training
Board were female. in partnership with the Harvard Business
School and INSEAD.
The proportion of women in our Senior
Leadership Team increased from 39 percent Air New Zealand publishes an annual Gender
in 2018 to 44 percent in 2019. This compares Equity Pay Gap Report and in 2019 males
favourably to the 43 percent of women across were paid 0.46 percent more than females in
our entire employee base. Twenty women roles of similar complexity and responsibility,
are participating in our internal Women in compared to 0.41 percent more in the 2018
Leadership programme in 2019, designed to financial year. This gap and the change since
accelerate the development of our top female last year are driven by differences in tenure,
talent. And we’re seeing results — since its experience and performance. We continue to
inception in 2016, 18 participants having been critically examine our processes and policies
promoted and 13 have moved laterally into to ensure they promote equitability.
new roles. By November 2019, 69 women will
have completed the programme.15 | Sustainability Report 2019 | Engaging Air New Zealanders He waka eke noa | 16
01
Developing Māori
& Pasifika leaders
We are committed to greater The Manu Network is led by Māori and Sharing tikanga Māori
diversity of thought at Pasifika employees to showcase and
leadership level. Māori and
celebrate Polynesian language and cultures We want all Air New Zealanders to be
and provide support for Māori and Pacific comfortable and capable of sharing Māori
Pasifika employees make Islanders to learn, be inspired and grow. language and culture with the world, and
up 18 percent of our to be true ambassadors for Aotearoa. We
For those starting their career, our partnership share a range of te reo and tikanga 2 Māori
employees and 15 percent with the TupuToa internship scheme creates resources across our organisation and have
of our leaders.1 Our target to a talent pipeline for young Māori and Pasifika developed a mobile app so our people and
superstars. We’ve partnered with TupuToa
increase Māori and Pasifika since 2016, committing to taking on 25 interns
customers have access to cultural education
and language resources wherever they go.
talent into leadership roles by 2020. Already 21 have come through our Customers can also engage with te reo
to 20 percent by 2022 will be doors. We recently committed to another through our Inflight Entertainment system
three years with the programme, with a and kiosks.
driven by a series of recently stronger focus on converting internships to
introduced initiatives. permanent roles. We have partnered with Te Matatini, New
Zealand’s premier kapa haka competition to
This year we have partnered with Mike Moka Our next focus on ensuring diversity of jointly develop and showcase the festival to a
and his Indigenous Growth organisation thought at a leadership level is among our wide audience. In June we held Hakamania,
to jointly create and deliver Mango Pare, Asian employees, who make up a significant an internal event encouraging Air New
a new innovative learning programme to proportion of our total employment base. Zealanders to engage with Māori culture and
language. Teams from across the business, PAN EL VO I CE
including entries from Australia and London,
The Mango Pare is the traditional Māori symbol competed to perform the best haka. Dame Anne Salmond
of strength & courage, tenacity of life, unrelenting
Sustainability Advisory Panelist
This year saw another 373 employees
determination, vigour and wealth. When I joined Air New Zealand’s and guardianship Māori have for the natural
participate in Te Ara Nui, the marae-based
graduation ceremony for new cabin crew Sustainability Advisory Panel five years environment. I think there’s more room for
and ground employees of all cultures to ago and began having conversations movement and I see a real appetite for that
celebrate, with their whānau, the completion about cultural diversity, I felt there was in the organisation.
develop leaders through indigenous values. of their training. genuine commitment to change but also
The initiative will see our aspiring Māori and a long way to walk — or fly — in this case. The aspiration to get more Māori and Pasifika
Pasifika leaders gain the skills, knowledge into leadership roles is being supported
and belief to take on leadership opportunities. What started with the Koru on the tail of by new approaches to leadership training
It also instills in our people a cultural diversity the aircraft and a sense of appreciation for and talent acquisition. Involvement with Te
which flows into their work practices at Air the beauty of the language has now evolved Matatini and Hakamania, and the growing
New Zealand. The first group of 16 leaders into a much deeper and more integrated number of internal events being held on
and aspiring leaders started their Mango Pare approach across all aspects of Tikanga marae help to signal that diversity is truly
journey in July 2019. Māori. The partnership with Ngati Porou is welcomed and Air New Zealand employees
a great example of this, involving mutual can be themselves at work.
learning and capacity-building as well as
commercial interests. I admire the experimental spirit of Air New
Zealand and the innovation that comes
On the sustainability front there’s a huge from this and I look forward to seeing the
amount to learn from the Māori philosophy of positive outcomes on their workforce and
Kaitiakitanga and the strong sense of kinship wider community.17 | Sustainability Report 2019 | Engaging Air New Zealanders He waka eke noa | 18
01 The coming wave of a key feature of the employee experience, it aims to improve literacy levels and develop
automation presents a and to help us accelerate upskilling of the knowledge and skills to help employees
entire workforce. Workday Learning gives realise their full social, cultural, economic
skills gap which we need employees the ability to learn on a phone or and career potential. The first round of
Building a strong to urgently close to better
equip our people for the
future of work.
tablet, not just in the classroom, and LinkedIn
Learning provides access to a digital library
of thousands of global, expert-led online
courses across a wide range of topics.
Project Mana participants from Auckland
Airport graduated with qualifications in
Business Communication, Computer Skills,
Maths, Effective Writing Skills and Verbal
Communication. With the continued
learning culture
To build tomorrow’s leaders at Air New We have also transitioned from paper-based support of Literacy Aotearoa we plan to
Zealand, we have identified core future- exams to digital E-Exams through an external roll this initiative out to other airport teams
focused capabilities that are being integrated provider. This efficient solution ensures we in New Zealand.
into our leadership programmes. We are meet our stringent regulatory compliance
also transforming from predominantly requirements and is projected to save 5,000 This year we signed up to the Prime Minister’s
class-based or event learning to a more hours processing paper exams and 25,000 Business Advisory Council Future of Work
personalised and flexible learning style pieces of paper a year. Skills Pledge, committing to double our
where employees can choose how, where training/reskilling hours by 2025 and to report
and when they learn. Building key life skills in our people is another annually on our progress.
core priority and has seen us launch Project
We have invested in two key digital learning Mana this year. A pilot programme with
platforms to ignite continuous learning as Literacy Aotearoa and our airport teams,19 | Sustainability Report 2019 | Engaging Air New Zealanders He waka eke noa | 20
01
Protecting our
people’s wellbeing
Supporting the health, safety Reducing injuries Employee Assistance
and wellbeing of our people Programme
is a critical part of being a There was a continued reduction in total
recordable rate of injuries 1 from 11.2 in 2018 All Air New Zealand employees and their
good employer. With more to 10.3 in 2019. Most reported injuries were immediate families have free access to our
than 12,500 Air New the result of manual handling activities, slips, Employee Assistance Programme (EAP).
trips and falls, and contact with objects. The
Zealanders working in a majority of these occurred while handling EAP is an independent, confidential,
variety of roles across our baggage, special handling, stowing cabin professional support service available 24/7
business, a systematic bags and during meal service. to help them deal with issues or events in
their lives. There were 1,157 EAP cases
approach to identifying Our long-term focus in this area is to in the past year, up from 924 in the 2018
and minimising risk to our implement ‘safety in design principles’ to financial year. We have actively promoted
employees’ health and eliminate or reduce manual handling risks.
For example, installing bag drop conveyors
the programme over the last year to ensure
our people are aware of the different ways
wellbeing is critical. at check-in means customers can safely they can use it. We provided onsite EAP
and easily upload their bags, reducing the counselling in Nelson during the February
Operational challenges experienced by risk of handling injuries for employees and wildfires when some of our families
the airline in the past year further highlight the customers. We have installed self-service were evacuated from their homes and in
importance of this responsibility. To support bag drops at Auckland Domestic, Wellington, Christchurch in March to support many
our people through the disruptions associated Napier, New Plymouth, Invercargill, Dunedin employees and families in the aftermath
with the Rolls-Royce engine issues, we and Christchurch Airports. of the mosque attacks.
implemented a People Resilience team which
hosted monthly check-in calls for leaders to We are also addressing fitness for work
assess any impact on resourcing, absence or through targeted High Performance
wellbeing issues. Any additional support was Engagement 2 initiatives and the roll out of
implemented immediately or escalated to the our Safe Teams manual handling training
Executive for action. programme. The trial of vacuum-assisted
bag lifting technology at Christchurch Airport
We were proud to take overall honours at the shows promise as a future game-changer
New Zealand Workplace Health and Safety in reducing manual handling injuries.
Awards this year, winning the 'Worksafe
New Zealand/ACC best overall contribution
to improving workplace health and safety in
New Zealand' award. Our process to elect
293 Health and Safety representatives TOTAL RECO RDABLE R ATE O F I N JUR I ES ( TRR)¹
across our entire network was recognised
by the New Zealand Safety Blackwoods’
Target TRR of less than 10 by end FY20.
‘best initiative’ award to encourage worker
involvement in health and safety.
15.2 11.2 10.3
% year on year decrease 26% 8%
32% decrease from 2017 to 2019 2017 2018 201921 | Sustainability Report 2019 | Engaging Air New Zealanders He waka eke noa | 22
01
Community
engagement
Airpoints™ for Schools Koru Care flights
With the Airpoints™ for Schools programme We have a longstanding relationship with
we team up with Airpoints™ members to Koru Care New Zealand, who are best known
give Kiwi kids an opportunity to take flights for taking groups of children with major health
for educational travel experiences. issues to magical overseas destinations.
In the past year, Air New Zealanders
Airpoints Dollar™ donations from Airpoints helped with five Koru Care flights, flying 66
members, matched by Air New Zealand, seriously ill children and their guardians to
help schools with their flight costs, giving dream holidays at Disneyland California and
aspiring young leaders the opportunity to Australia’s Gold Coast.
gain knowledge and inspiration to reach
their potential. This year 164 students from
10 schools with outstanding environmental,
cultural, social and educational goals were
selected for international and domestic
travel. Six students from Whangarei's He
Matariki Teen Parent School flew to explore
the capital city and visit Parliament, Te Papa
and Victoria University. Hatea-A-Rangi, a
decile two school in Tokomaru Bay, gave
25 students the chance to travel to Rarotonga
to connect with their Cook Island heritage
and perform at the Te Maeva Nui Festival,
and Hedgehope School in Southland sent
30 students to Russell to learn more about
New Zealand culture and the history of the
Treaty of Waitangi.
Greenteam in
the community
Passionate employees are engaged have cleaned up beaches and rivers, planted
employees. We encourage Air New native trees, and assisted the Department of
Zealanders to be active in their communities, Conservation with the release of pāteke on
participating in programmes and causes the Milford Track, trapping predators in the
they care deeply about. Abel Tasman and surveying seabird numbers
around Kapiti Island.
Our Greenteam is a network of more than
2,000 employees across New Zealand and We set a target last year to increase the
around our international network who can number of employees who participate in
volunteer to take part in projects that protect community programmes. In the last year 497
and conserve our natural environment. employees took part in a Greenteam activity,
This year Greenteamers and their families a big increase from 276 the previous year.TOTAL TONNES CO 2 - e SAVED THROUGH CARBON REDUCTION PROGRAMME 1
Tackling climate
02 change & carbon
Climate change is air operations account for about Our carbon strategy is governed
2017
3,553
2018
11,468
2019
15,084
without doubt the 0.7 percent of New Zealand's total by our Sustainability Executive FLEE T AGE I N YE ARS (S E AT-WE I G H TED)
emissions.1 2 Steering Group with regular
biggest risk our reporting to the Air New Zealand
industry has faced. The growth of the global aviation Board on carbon emissions and
industry has created enormous our regulatory obligations.
As an airline, we are already economic and social good — it
seeing the impact of climate connects people and cultures, Air New Zealand is a founding
change in New Zealand, with enables international trade and member of the Climate Leaders
increasingly volatile weather enterprise, and boosts tourism Coalition (CLC), a group of
patterns and severe events and local economies. What is more than 100 organisations
2015 2017 2019
such as cyclones and storms clear is we now need to grow in in New Zealand that work
affecting flights and preventing a different way. together to take action on climate
customers from getting where change. By joining the CLC, Air 2014 2016 2018
they need to go. While we are delivering such New Zealand has committed to
benefits and working to minimise taking climate action in
These weather events are no our carbon emissions, until accordance with the CLC’s
longer rare occurrences — they aviation biofuels are readily Climate Change Statement.4
are happening more regularly available in New Zealand or
and have become a fact of life there are significant technology In August 2019 Air New Zealand
for our operational teams which breakthroughs such as electric became one of the first New
are constantly having to juggle aircraft, we are unlikely to Zealand companies to sign up
schedules, customers and deliver further significant carbon as a supporter of the Task Force FUEL EFF I C I EN CY I M PROVEM EN T
aircraft as a result. emissions reductions through on Climate-related Financial
our own operations. Disclosures (TCFD), joining over
The aviation industry contributes 800 other organisations globally
between two and four percent In 2019 our carbon footprint committed to implementing
of global emissions. Air New (greenhouse gas emissions) and improving climate-related
Zealand emits around 3.5 increased by just over 5 percent. disclosures. We will be
million tonnes of carbon dioxide This was primarily due to network reporting against the TCFD
annually, which makes us growth of four percent and fleet recommendations from the 2020 2017 2018 2019 2 Average annual improvement
one of the country’s largest substitution challenges triggered financial year. since 2009
carbon emitters. Our domestic by the Rolls-Royce engine issues.3
Average annual improvement in aviation fuel efficiency (improvement vs previous year)
GREE N H OU S E GAS I N VE N TO RY ⁵
FLY N EU TR AL
Total operational GHG emissions Tonnes Tonnes Tonnes
emissions scope sources CO 2 -e 2017 CO 2 -e 2018 CO 2 -e 2019
Scope 1 Aviation Fuel, LPG, 3,197,011 3,296,085 3,468,712
Scope 2
Natural Gas, Ground
Diesel, Ground Bio
Diesel, Ground Petrol
Electricity 2,624 3,044 3,098
130,282 183,624
2018 2019
Totals 3,199,635 3,299,129 3,471,810⁶
Number of customer journeys voluntarily offset through FlyNeutral 3
Biomass (wood pellets) 998 638 72525 | Sustainability Report 2019 | Tackling climate change & carbon He waka eke noa | 26
02
Reducing our carbon
footprint in the air...
We have instigated a number Improving efficiency Exploring biofuel
of fuel savings measures through flight operations production
that have helped us improve
Last year we implemented more efficient
efficiency by more than 20
While there has been lots of testing of
departure climb profiles on our Boeing 777 aviation biofuel production globally, in
percent since 2009. We are and Boeing 787-9 aircraft, which has resulted Australasia large scale and practical volumes
in CO₂-e savings of 1,813 tonnes and 575 of aviation biofuel remain some way from
also focused on reducing tonnes of fuel saved. being a commercial reality, particularly in
fuel use and emissions by the absence of clear policy incentives to
investing in a modern, fuel- Approach-path efficiencies have also encourage production.
efficient fleet that will drive
progressed. In December 2018 we
implemented new approaches into We know a future biofuel solution is
future savings. Christchurch across our jet fleet to reduce necessary. The big challenge is being able
the distance flown, allowing for continuous to sustainably produce a viable aviation
In May we announced our commitment to low-powered descents and decreasing the biofuel option at the scale required to meet
purchase eight Boeing 787-10 Dreamliner amount of fuel required. In the past aviation industry supply needs. We joined
aircraft powered by GE Aviation’s GEnx-1B 12 months these approaches have saved with Z Energy, Refining NZ, SCION and
engines. The first of these highly fuel more than 150 tonnes of fuel and 480 tonnes Auckland International Airport to investigate
efficient aircraft will join our fleet in the of CO₂-e. We are currently trialling similar how we could transition aviation fuel into
2023 financial year. approaches into Wellington and plan to biofuel and whether setting up an aviation
have these in place from September 2019. biofuel plant in New Zealand could work.
These long-haul aircraft will replace our fleet The capital investment would be significant
of eight Boeing 777-200 aircraft, which will Over the past year we have focused on and it has not been achieved anywhere in the
be phased out by around the middle of the removing further unnecessary weight from world without substantial government support
next decade. These aircraft are expected our domestic jet aircraft and have saved to establish production and thereafter ensure
to be up to 25 percent more fuel efficient nearly 200 tonnes of fuel and 622 tonnes of fuel pricing remains economically viable.
than those they are replacing and have the CO₂-e. This includes carrying less potable
potential to save 190,000 tonnes of CO₂-e water on each flight, meaning we top up
emissions per year. more frequently to meet the specific needs
of individual flights.
To the end of the 2019 financial year, we
had taken delivery of five A321NEO and three
A320NEO aircraft. New generation engines,
fuel efficient Sharklet wingtip devices and,
on the A321NEO, more seats, mean these
aircraft are collectively expected to help Hybrid and electric aircraft:
deliver fuel savings of at least 15 percent
compared with the aircraft they are replacing. flying into the future
We are working with aircraft manufacturers We have also partnered with Zephyr
to explore the role new propulsion Airworks, the operator of Cora, the world’s
technologies could play in the future of first autonomous air taxi. The agreements
regional aircraft. Hybrid electric aircraft with both partners signal our commitment
are expected to enter the market in the to embracing new technologies that will
next decade. Depending on when these make life easier for our customers, as well
technologies become available for larger as understanding the potential of cleaner
turboprop aircraft, we believe these could be energy solutions for travel in the near future.
a viable option for our regional network. Regulatory support will be critical to attracting
these new technologies to New Zealand and
enabling their uptake.27 | Sustainability Report 2019 | Tackling climate change and carbon He waka eke noa | 28
02 We've converted 92 percent Increasing our use of
of our on-road light vehicles ground power to save fuel
to electric.1 We have a target
Further afield, we recently began plugging
...and on the
Two years ago we moved to using electricity
that all our specialist airport to power aircraft while at the gate whenever into ground power at our newest US
ground service equipment, available at Auckland International Airport, destination, Chicago O’Hare International
and a roll out to Wellington International Airport, as well as at Sydney Airport in
including aircraft tugs, Airport and Christchurch International Airport Australia for our wide-body aircraft. We will
loaders and golf carts, are quickly followed. Traditionally our aircraft begin reporting on the carbon savings from
ground. Electrifying 100 percent electric where
viable options exist.
have been powered by an Auxiliary Power
Unit (APU) while on the ground that
consumes jet fuel and generates carbon
these ports over the coming financial year.
An extension of the existing initiative aimed
at increasing carbon savings is in progress
our ground fleet
Currently 62 percent of our dioxide emissions. We estimated we would at Auckland International Airport. The aim is
save more than 6,000 tonnes of CO₂-e
New Zealand-based ground
to further reduce APU use by utilising ground
annually by switching the APU off and power in conjunction with external electrically
service equipment is connecting to a renewable power source, powered air-conditioning units.
powered by electricity, and and we’ve exceeded expectations. This
financial year we saved 2,637 tonnes of fuel,
we will convert 85 percent generating 8,322 tonnes of CO₂-e savings.
of this equipment to electric
by the end of the 2020
financial year.29 | Sustainability Report 2019 | Tackling climate change and carbon He waka eke noa | 30
02 02
Meeting regulatory Supporting the
obligations Zero Carbon Bill
We participate in the New For emissions in international airspace, we Drylandcarbon We are supportive of, We would particularly welcome engagement A stable and well-planned low-emission
participate in the Carbon Offset and Reduction and development of specific policies within transition has the potential to traverse
Zealand Emissions Trading and submitted on, the the aviation sector to support low-emission election cycles and certainty would assist
Scheme for International Aviation (CORSIA). In March 2019 Air New Zealand entered into
Scheme. In the 2019 calendar Governed by the International Civil Aviation a limited liability partnership with Contact Government’s Zero Carbon technology solutions. corporate New Zealand to invest in a
year, Air New Zealand has Organization, CORSIA sets the global Energy, Genesis Energy and Z Energy to Bill. We want to see the lower-emissions future.
framework to measure, report and cancel form Drylandcarbon One Limited Partnership Aviation biofuels have the potential to enable
an obligation to report offset units for international aviation emissions. (Drylandcarbon), which will see the four
Government work in significant carbon emission abatement.
greenhouse gas emissions The monitoring phase commenced this year companies invest in the establishment of a partnership with sectors Incentivising development of local sustainable
generated from fuel use on and requires us to report emissions from geographically diversified forest portfolio to that have limited emissions aviation biofuels for scalable and cost-effective
supply would be of direct benefit to New
all domestic flights and then
international aviation. Along with other global sequester carbon and deliver New Zealand
participants we will begin to offset emissions Units (NZUs). reduction options to explore Zealand and would reduce aviation emissions.
purchase and surrender to associated with growth beyond 2020. complementary policy Policy to facilitate a smooth transition to lower-
Drylandcarbon is specifically targeting emission, hybrid or fully electric aircraft will
the Government an equal We also support the industry’s targets of marginal, unproductive and often erosion-
measures that could support also be required in the short-to-medium term.
number of New Zealand Units 1.5 percent annual average fuel-efficiency prone land for conversion to sustainable lower-emission investments
to match those emissions. improvement (2009-2020), carbon-neutral forestry for carbon farming. and industry innovation.
growth from 2020 and halving 2005
emissions by 2050. Although the primary objective is to produce
a stable supply of forestry-generated NZUs
to support the partners meeting their annual
requirements under the New Zealand Emissions
Trading Scheme, given the potential size of
the portfolio the partnership is well placed to
make a real contribution to New Zealand’s
broader emission reduction objectives.
PAN EL VO I CE
Dr Suzi Kerr
Sustainability Advisory Panelist
Forestry Zero Carbon Bill
Forestry remains an important The Zero Carbon Bill will lay engagement with key players.
part of New Zealand’s short-term the foundation for New Zealand’s The Commission will need a
response and Air New Zealand’s low-emission economy, setting constitutional structure and
engagement with landowners and high-level goals and establishing relationship that maintains
stakeholders to drive afforestation the Climate Change Commission democratic control, but requires
has been valuable in moving those to guide New Zealand’s the Government to release its
efforts in a more professional and low-emissions transformation. reports in a timely manner, take
efficient direction. Focusing on new recommendations from the
forests rather than purchasing units While progress on the Zero Carbon Commission seriously and respond
generated from forests that already Bill is critical and promising, as to recommendations publicly if
exist but may not have previously always the devil is in the detail. they choose not to follow them.
been entered in the ETS is a more The Climate Change Commission The relationship between the
credible approach. The other will need to have an appropriate Commission and Government
environmental effects of the forests structure as well as sufficient and must continue to depoliticise the
that are created will need to be stable resourcing to enable it to process of New Zealand’s
carefully considered. build the capability required to low-emissions transformation.
provide credible advice and strong31 | Sustainability Report 2019 | Tackling climate change & carbon He waka eke noa | 32
02
FlyNeutral —
Helping our customers
voluntarily offset VO LU N TARY O FF S E T T I N G UP TAK E F Y19 1
carbon emissions 4.6% 9.8% 7.3% 6.0% 4.3%
With growing awareness of As well as absorbing carbon from the fully offset more than 183,600 journeys, New Zealand United Kingdom United States Canada Australia
the effects of climate change, atmosphere, native forestry projects up from just over 130,200 in the previous
offer many benefits to the surrounding year. We have also seen a rise in the number 1 Number of bookings partially or fully offset as a percentage of all bookings; New Zealand data for all of FY19, other markets since functionality available
we know many of our communities. Chatham Islands Mayor of corporate and government customers
in early 2019
customers are committed to Alfred Preece has set aside a large part joining our FlyNeutral programme, albeit in
living in a more sustainable
way. FlyNeutral is one way In the past year, retail customers partially or fully
for customers to do their bit offset more than 183,600 journeys, up from just
alongside us to minimise
over 130,200 in the previous year. PAN EL VO I CE
the impact of air travel on
the planet. of his land for reforestation and it’s become lower numbers than we would have hoped,
Prof Tim Jackson
Sustainability Advisory Panelist
a habitat to encourage back some of the and we continue to encourage individual
When customers choose to offset the carbon
unique plants and birdlife of the Chatham retail customers and businesses to join us
from their flights, the money collected
Islands and return that part of the island to in understanding and offsetting their When you’re living in the middle could grow three- or four-fold by made it all famous. Just a year ago,
goes to carefully chosen projects which
how it was pre-settlement. Alfred’s native emissions. As well as encouraging our of a vast ocean 2,000 km from the 2050 if nothing is done. And in any she was a lone schoolgirl sitting
provide permanent, verified and sustainable
forestry project is one of six permanent customers to offset their carbon dioxide nearest country, the last thing you case, flygskam is about fairness. outside the Swedish Parliament with
emission reductions. These projects
native forestry projects in New Zealand emissions through FlyNeutral, we offset all want to hear about is ‘flygskam’. One return flight from Auckland to a handwritten placard. Six months
generate emissions reduction units, which
supported through FlyNeutral. This year the carbon dioxide emissions associated with Translated literally it means ‘flying London accounts for about four later she had inspired a million and
are purchased and then cancelled from
programme reached a significant milestone employees flying for work around our network. shame’ and it’s the name of the tonnes of carbon dioxide; that’s 10 a half students from 112 countries
circulation permanently.
— together with our customers we have In the last year this amounted to more than Swedish anti-flying movement that times larger than the entire annual to join her school strike for the
purchased more than $1 million worth of 11,500 tonnes of CO₂-e reduced or removed led to an 8 percent fall in domestic carbon footprint of the average climate. This (northern) summer she
Through FlyNeutral and with the assistance
carbon offsets from permanent New Zealand from the atmosphere. plane journeys within Sweden Bangladeshi. Flying must either find sailed across the Atlantic to get to
of Permanent Forests NZ, we support
native forestry projects. during the first four months of 2019 a way to go fossil-free or else there the UN climate change conference.
permanent native forestry projects across
alone. The movement argues that must be fewer air miles factored into Not flying. There is a simplicity to
New Zealand, from Northland to the Chatham
Since integrating the offsetting functionality the climate change implications the business plan, rather than more any message when it comes from
Islands and from Wellington City Council's
into the booking flow in late 2016 and of flying around the world are now and more each year. Waiting for it all the mouths of children. The house
Outer Green Belt to Hinewai Reserve on the
introducing offsetting through our US, United so severe that people should be to blow over is really not an option, is on fire, says Greta. The time for
Banks Peninsula. These projects are certified
Kingdom, Canadian and Australian websites ashamed of doing it. Tough gig which is why Air New Zealand’s talking is over. It’s time to act on
under the New Zealand Government's Forest
this year, we’ve seen a stronger uptake for a Kiwi. world-leading Carbon Reduction climate change. That’s a massive
Sink Initiative. We also support sustainable
rate — from less than 100 bookings a month Programme is so vital. challenge for any airline, whichever
energy projects in countries we fly to,
to more than 15,000 journeys per month. Carbon from flying represents hemisphere you’re in. But it’s a
including those in the Pacific region.
In the past year, retail customers partially or only two to four percent of global The flygskam movement came from challenge that Air New Zealand is
emissions, so it’s tempting to a letter written in 2017 signed by already well placed to take on.
believe this movement will never opera singer Malena Ernman, who
really take off (so to speak). But happens to be… Greta Thunberg’s
that is to miss the point. Emissions mum. It was Greta herself whoYou can also read
