MGMT 201: Air New Zealand Sustainability Report and Strategy

This report critically analyzes Air New Zealand's current sustainability practices, particularly within the social domain, using the Triple Bottom Line framework. The analysis highlights Air New Zealand's initiatives, such as diversity programs and injury reduction, while also identifying areas for improvement, including employee relations. The report recommends future strategies, such as increased employee participation in community activities and enhanced training programs. It also proposes two methodologies: adopting Qantas's employee recognition programs and implementing a profit-sharing plan to improve employee relations and engagement. The report emphasizes the importance of transparency and fairness in handling employee disputes and suggests strengthening the HR division to effectively manage such concerns, ultimately aiming to enhance Air New Zealand's commitment to sustainability across all aspects of its business operations.

Running Head: MANAGEMENT 0
Managing for Sustainability

MANAGEMENT 1
Part 1 – Sustainability practice of Air New Zealand
For nearly 80 years, Air New Zealand have been a part of the fabric of society and
commit a purpose fostering significant practices for the New Zealand success in terms of
social, environmental and economically. It can also be associated to the three significant
aspects of triple bottom line sustainability framework, i.e. people, planet and profit. In
today’s dynamic and complex business environment, it is very necessary to assess more than
just profits to evaluate the performance of business (Teece, Peteraf & Leih, 2016). In relation
to this, the airline goal is to put sustainability at the heart of its business model emphasizing
on sustained economic growth, positive social impact and reduced environmental impact. It
concerns with the company long term plan to grow and develop at a positive rate while
further commitments and sustainability initiatives.
Especially from social domain, the company is doing well by practicing significant
steps such as embracing diversity like in 2018, Air New Zealand launched an unconscious
knowledge and bias awareness programme to help employees understand how individual bias
influence decision making and so far, nearly, 733 employees have ended with the training (p-
airnz.com, 2019). The company is also protecting peoples wellbeing as considering
company’s annual report 2019, there is a substantial reduction in total recordable injuries
rates from 11.2 in 2018 to 10.3 in 2018 (p-airnz.com, 2019). Similarly, the company is also
promoting gender balance as all levels as business imperative as the company believes that
regardless of whether on ground or in the air, they must put efforts to form a culture that
empowers, attracts, recognises, develop and engages women.

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Part 2 – Recommendation to strategy to social domain
Every year, Air New Zealand announced number of sustainability commitments in
relation with social domains, however, there are few areas to which their can improve on and
recognised to be the most honoured airline. The company can offer more opportunities to all
the employees so that they can participate more in community activities and make a positive
impact. It can also include volunteer activities that can be stimulated and instilled inside the
employees through effective mentoring and training. It will automatically raise the brand
goodwill in New Zealand airline industry as well also at global level. To best open its wings
in New Zealand and other market areas, Air New Zealand should introduce more world class
operations and training facility so that all the crews and other important people can receive
well training on grounds that could help the company to showcase exceptional services to the
passengers.
It is also necessary for Air New Zealand to strengthen its employer-employee
relationship as the company name has been controversy due to various employee disputes and
relationship. Taking case of last year, it was the seventh time where a former flight attendant
put a lawsuit against the company. Not only this, between 2012 and 2018, five similar cases
were also brought by the employment court and authority and this has lead loss to the airline
in terms of cost orders of more than $20, 000 (Geluk, 2019). Air New Zealand is apparently a
very large organisation and such cases can be incredibly challenging and financially
debilitating. As a part of sustainability initiative, it is recommended to Air New Zealand to be
rational and fair with such instances and develop its HR division more transparent so that
they can handle such concerns effectively.

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Part 3- Recommendation of two methodology
Methodology 1
Qantas takes all sustainability measures and practices on priority basis and in relation
with the triple bottom line model of people, planet and profit, the company believe that they
are only at the early adoption stage and hence need to wait until this becomes the mainstream.
Unlike Air New Zealand, Qantas manages its employment relationship authority in a well-
planned manner the airline also has won several awards such as in 2015 associated to the
annual Australian HR team of the year award (Bruce, 2016). From social perspectives, Air
New Zealand can undertake various significant practices similar to Qantas airlines like
introducing people choice awards to recognise their employees for delighting their passengers
and users. This program is already been celebrated and managed by Qantas and known to be
eXcel.
Being the largest carrier in the Australia, Qantas also follows dual brand strategy with
having Jetstar as its subsidiary brand offering low cost carriers (LCC) services in different
countries (Homsombat, Lei & Fu, 2014). However, it also bound the company to follow
separate CSR practices in relation with sustainability performance and therefore, Air New
Zealand can also be recognised as one of the pioneer brands in the country and with adopting
the dual brand strategy, there are further chances for the airline to increase its scope of
sustainability practices and activities, mainly towards social domain. Furthermore, such
initiatives will also support communities throughout New Zealand and gain success in
relation with various opportunities. Therefore, in comparison with Qantas airline, Air New
Zealand can embrace over such strategies into their business operations and as a part of
sustainable efforts.

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Methodology 2
There are various opportunities available to Air New Zealand to celebrate its
dedication to the triple bottom line of performance and takes pride in the way they care their
customers, investors, employees and communities. In order to improve its employer-
employee relationships, Air New Zealand can introduce a new profit-sharing plan which can
be further award to the retirement plan and part in cash. In this plan, the employees can
receive up to 10 per cent of eligible compensation as a contribution to the profit-sharing plan
and also as specified in their collective bargaining agreement. Air New Zealand needs to
ensure that their employees never lose focus on connecting their customers and even in the
years of big challenges and achievements.
Furthermore, Air New Zealand can increase its volunteer activities session time to
more than 120,000 hours together with the employees as it will develop a sense of
commitment in the employees with a further addition to optimum use of resources, time and
company strategic objectives. Such practice will automatically fulfil the criteria of two ways
in relation with Triple bottom line and help significantly in the development of the
community and employees. In addition, such volunteering activities can also be supported by
various offers and inducements such as the employee who are accomplishing particular hours
in voluntary activities will receive a complimentary roundtrip with the airline or so on.
Hence, all this report about the Air New Zealand, its sustainability practices and the triple
bottom line model.

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References
Bruce, V. (2016). The story behind the award-winning Qantas HR team. Retrieved from
https://www.hcamag.com/au/news/general/the-story-behind-the-award-winning-
qantas-hr-team/144887
Geluk, S. (2019). Air New Zealand 'dragged along for the ride' in dispute with fired flight
attendant. Retrieved from https://www.stuff.co.nz/business/112701767/air-new-
zealand-employment-dispute-highlights-the-headaches-firing-staff-can-bring-on
Homsombat, W., Lei, Z., & Fu, X. (2014). Competitive effects of the airlines-within-airlines
strategy–Pricing and route entry patterns. Transportation Research Part E: Logistics
and Transportation Review, 63(1), 1-16.
p-airnz.com. (2019). Report 2019. Retrieved from https://p-airnz.com/cms/assets/PDFs/2019-
sustainability-report-v7.pdf
Teece, D., Peteraf, M., & Leih, S. (2016). Dynamic capabilities and organizational agility:
Risk, uncertainty, and strategy in the innovation economy. California Management
Review, 58(4), 13-35.