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 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 LETTER FROM 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 in time with a groundswell for urgent action. Countries are crystallising never before to be a trustworthy source of in the regions by promoting tourism career 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 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 more to play their part in Climate Leaders Coalition, Air New Zealand diversity and inclusion, automation and as CEO, and our sustainability journey 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 , 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 This year the Air New Zealand Executive identified to address the biggest of the world’s largest contributor to GDP. Our company challenges — and there are many — purpose also reflects the ’s role in 'Sustainability in the Bloodstream' as a long-term business must continue to step up and helping to protect the natural environment mobilise their people, knowledge and for Kiwis and visitors alike, and the organisation-wide strategic pillar. 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 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 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 LETTER 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 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 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 New Zealanders to each other destinations. We also operate one of the most in the world, particularly around sustainability and regions across New Zealand, while is inextricably linked to the connected 1 domestic networks in the world issues, has increased significantly in recent Pacific Rim focus, that our alliance relationships with airlines in success of New Zealand and with the world. We take with more than 30,000 customers travelling years. Social media has made it much provides passenger and key offshore markets complement the our responsibilities to our on more than 400 flights each day between easier for like-minded groups to advocate destinations we fly to. With more than 3.2 and this is reflected in 20 domestic destinations. for environmental and social advances. This cargo services to, from, million members, our Airpoints™ programme customers very seriously. makes it even more important for us to give and within New Zealand is considered the most valuable loyalty our company purpose: 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. delivering positive earnings every year bringing tourists to New facilitating urgent movements of medical and choosing to fly with airlines that are making since 2003 and paying dividends to our Zealand’s success — Zealand or taking exports to infrastructure supplies. For a small island significant positive change and they can take shareholders every year since 2005. nation in the Pacific, air travel provides a action by offsetting the carbon emissions socially, environmentally the world, customers are at vital connection to the rest of the world. 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 1 on the following issues: We have a four-member Sustainability what is important to them. 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 is aligned with the United our sustainability agenda and drives Six external members, Dame Anne Salmond, to mitigate risk and harness our passionate employees sharing their change through their respective parts of Sir Rob Fenwick, Dr Susanne Becken, aspirations for change. 03 Supporting New Zealand 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 future for all. framework areas. The Panel and other company Sustainability Advisory Panel provide a vital 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 SPLIT OF ALL EMPLOYEES

Engaging % Air New Male Female43 01 Zealanders FEMALE SENIOR LEADERSHIP

% % % % As an airline, we They trust they are getting on We are consistently ranked as 30 39 39 44 distinguish ourselves a well-maintained aircraft with a one of New Zealand’s most 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 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 EMPLOYEE ASSISTANCE PROGRAMME (EAP) CASES day. Our customers received 40,470 job applications To deliver on this we need to — more than three times the choose to fly with us 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 standard. Collectively, passionate as a great employer meets the aircraft door with a and inspired Air New Zealanders reality of the employee experience are our greatest strength. once on board. Your Voice, our , warm smile and a bi-annual employee engagement 1157 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 EMPLOYEE NETWORKS IN OPERATION organisations in Australia and New Zealand.

Women’s Māori and Pacific Islands Kiwi Pride 1 Network 2 Manu Network 3 Network 4 Network

Enable Young Professionals Ex-Services 5 Network 6 Network 7 Network

MĀORI & PASIFIKA IN MANAGEMENT DIVERSITY & INCLUSION

Proportion of Māori & Pasifika External accreditation ticks in management positions received since 1 July 2018 throughout the organisation % % in 2019 ² 132018 152019 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 (IATA) Annual General Meeting. The award recognised Air New Zealand as leading the We have seven active way for diversity and inclusion in the global aviation industry. employee networks, each sponsored by a member We have seven active employee networks, each sponsored by a member of the of the Executive, which Executive, which connect, support and give voice to all employees. These employee connect, support and networks are a driving force in creating an inclusive workplace and have been give voice to all employees. 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 CASE STUDY

International Women in Engineering Day

Three employee-led Air New Zealand groups Gender are making it their business to increase the 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 balance 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 celebrate Polynesian language and cultures leadership level. Māori and 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 customers have access to cultural education since 2016, committing to taking on 25 interns 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 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, PANEL VOICE including entries from Australia and London, The Mango Pare is the traditional Māori symbol competed to perform the best haka. Dame Anne Salmond Sustainability Advisory Panelist of strength & courage, tenacity of life, unrelenting This year saw another 373 employees participate in Te Ara Nui, the marae-based When I joined Air New Zealand’s and guardianship Māori have for the natural determination, vigour and wealth. 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.

1 Based on available ethnicity data in our internal Human Resources management system 2 Tikanga: Māori customs and traditional values 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 to urgently close to better tablet, not just in the classroom, and LinkedIn Project Mana participants from Auckland Learning provides access to a digital library Airport graduated with qualifications in equip our people for the of thousands of global, expert-led online Business Communication, Computer Skills, future of work. courses across a wide range of topics. Maths, Effective Writing Skills and Verbal Building a strong Communication. With the continued 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 learning culture 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 eliminate or reduce manual handling risks. the programme over the last year to ensure employees’ health and For example, installing bag drop conveyors 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, , in March to support many our people through the disruptions associated Napier, New Plymouth, , 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 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 RECORDABLE RATE OF INJURIES (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 2019 21 | 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 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. 1 TOTAL TONNES CO2 -e SAVED THROUGH CARBON REDUCTION PROGRAMME Tackling climate change & carbon 3,553 11,468 15,084 2017 2018 2019

02 air operations account for about Our carbon strategy is governed Climate change is 0.7 percent of New Zealand's total by our Sustainability Executive without doubt the 1 2 FLEET AGE IN YEARS (SEAT-WEIGHTED) emissions. 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 and local economies. What is more than 100 organisations patterns and severe events 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 4 longer rare occurrences — they aviation biofuels are readily Climate Change Statement. 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 EFFICIENCY IMPROVEMENT 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. 3 since 2009 carbon emitters. Our domestic by the Rolls-Royce engine issues. Average annual improvement in aviation fuel efficiency (improvement vs previous year)

GREENHOUSE GAS INVENTORY⁵ FLYNEUTRAL Total operational GHG emissions Tonnes Tonnes Tonnes

emissions scope sources CO2-e 2017 CO2-e 2018 CO2-e 2019

Scope 1 Aviation Fuel, LPG, 3,197,011 3,296,085 3,468,712 Natural Gas, Ground Diesel, Ground Bio Diesel, Ground Petrol 130,282 183,624 Scope 2 Electricity 2,624 3,044 3,098 2018 2019 Totals 3,199,635 3,299,129 3,471,810⁶

Number of customer journeys voluntarily offset through FlyNeutral 3 Biomass (wood pellets) 998 638 725 25 | 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 While there has been lots of testing of efficiency by more than 20 departure climb profiles on our 777 production globally, in percent since 2009. We are and Boeing 787-9 aircraft, which has resulted large scale and practical volumes also focused on reducing in CO₂-e savings of 1,813 tonnes and 575 of aviation biofuel remain some way from 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. progressed. In December 2018 we efficient fleet that will drive 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 , 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 -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 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 Two years ago we moved to using electricity Further afield, we recently began plugging 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 including aircraft tugs, and a roll out to Wellington International Airport, as well as at Airport in ...and on the 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 100 percent electric where have been powered by an Auxiliary Power these ports over the coming financial year. Unit (APU) while on the ground that An extension of the existing initiative aimed viable options exist. consumes and generates carbon at increasing carbon savings is in progress Currently 62 percent of our dioxide emissions. We estimated we would at Auckland International Airport. The aim is ground. Electrifying save more than 6,000 tonnes of CO₂-e to further reduce APU use by utilising ground New Zealand-based 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, our ground fleet 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 Zealand Emissions Trading participate in the Carbon Offset and Reduction and submitted on, the and development of specific policies within transition has the potential to traverse Scheme for International Aviation (CORSIA). In March 2019 Air New Zealand entered into the aviation sector to support low-emission election cycles and certainty would assist 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 international aviation. Along with other global sequester carbon and deliver New Zealand supply would be of direct benefit to New all domestic flights and then 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. PANEL VOICE 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 strong 31 | Sustainability Report 2019 | Tackling climate change & carbon He waka eke noa | 32

02 FlyNeutral — Helping our customers voluntarily offset VOLUNTARY OFFSETTING UPTAKE FY191 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 atmosphere, native forestry projects up from just over 130,200 in the previous the effects of climate change, 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 offer many benefits to the surrounding year. We have also seen a rise in the number in early 2019 we know many of our communities. Chatham Islands Mayor of corporate and government customers 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. PANEL VOICE the impact of air travel on Prof Tim Jackson the planet. of his land for reforestation and it’s become lower numbers than we would have hoped, 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 who NUMBER OF PASSENGERS COMMUNITY FLOWN ON REGIONAL NETWORK ACTIVITIES

Supporting Schools supported through Airpoints™ for 5.12M 2017 10 Schools programme Biodiversity projects New Zealand 2018 supported with DOC and 5.36M iwi partners alongside 6 Great Walks 03 2019 5.71M Marine sentinel sites supported with DOC through with 10 research FLIGHTS PER DAY ON 2 projects underway sustainable REGIONAL NETWORK tourism 2017 2018

2019

Average number of flights per day

TRAVELLING DURING SHOULDER SEASON1

Proportion of international visitors on Air New Zealand travelling during shoulder season relative to peak 2017 2 2018 2019

FURRY AND FEATHERED FRIENDS TRANSPORTED FOR DOC

405 threatened creatures and conservation dogs relocated including:

109 77 60 50 Pāteke / Brown Teal Conservation dogs Kiwi Kakapo

1 Inbound shoulder season (April to November) arrivals on Air New Zealand; Source: Statistics New Zealand, International Visitors 2 To ensure comparability between years, previous years’ 1 Tourism Satellite Account 2018, Statistics New Zealand results have been updated using the same approach as 2019 35 | Sustainability Report 2019 | Supporting New Zealand through sustainable tourism He waka eke noa | 36

03 Working together to promote New Zealand to the world

Air New Zealand plays a pivotal role in the success of Supporting New Zealand New routes bringing new New Zealand’s tourism industry and, similarly, the tourism exporters visitors to our shores industry’s performance is an important factor in our commercial success. Together with our alliance partners we ExportNZ, in partnership with Air New Air New Zealand added Chicago and Taipei The Taipei route is also performing well and Zealand Cargo, is helping to unlock Kiwi to its international network in November 2018 has seen visitors to New Zealand increase fly about 45 percent of all international visitors to our shores. business potential on the world stage. Its and will begin flying to Seoul in November 2019. by 24 percent 2 since we started flying. Most Excelerate100 programme assists ambitious, of these visitors are holiday-makers, many Alongside our colleagues at Tourism New Tourism New Zealand and Air New Zealand motivated firms with global growth aspirations We're seeing strong customer demand for of whom visit regional ports when in New Zealand (TNZ), we also invest heavily in are also premium sponsors of TRENZ, an to access new export markets. our Chicago route, our fifth mainland North Zealand, as well as the main cities. marketing New Zealand to prospective annual industry event which brings together American port. It’s not just attractive to visitors in offshore markets. Together with more than 300 tourism operators with Air New Zealand Cargo is a platinum travellers from New Zealand, but significant Seoul is a densely populated city with more TNZ we have recommitted to a marketing international travel and tourism buyers and partner of the programme, which provides numbers of American visitors from the Chicago than 10 million residents and inbound leisure partnership worth up to $20 million annually media from established and emerging tourism a combination of group learning and area and beyond are flying on this new route. travel from South Korea to New Zealand has to promote New Zealand offshore. The markets. The event, held this year in , mentoring support, for exporters, by We expect the route to contribute significantly grown significantly in recent years, presenting joint activity will target potential visitors directly helps to grow New Zealand’s $39 exporters. Senior leaders share their to the New Zealand economy, and our regions an important tourism growth opportunity from Australia, China, North and South billion tourism industry. experiences and provide practical advice will also benefit as we know around 37 percent for the airline and the New Zealand tourism America, Japan, Singapore, the United and perspectives on how to grow an export of spending by US visitors to New Zealand economy. The new service will more Kingdom and Europe. business in a strategic way. occurs outside the main centres. conveniently connect the estimated 40,000 Koreans living in New Zealand with friends We are working together to increase the Part of our Cargo strategy is to help and family in their home country. economic value of tourism, ensuring our perishable product exporters get their visitors enjoy memorable experiences and products to customers in the best possible promoting travel throughout the country, condition. To do so, we have recently often in the shoulder seasons, so that all of purchased more than 500 new insulated New Zealand gets to enjoy the economic thermal containers compatible with our benefits tourism brings. This is the sixth Boeing and aircraft. These containers consecutive year TNZ and Air New Zealand ensure chilled products stay colder and have coordinated their international market fresher for longer and enable shipping to development and promotion, taking the total markets with hotter climates. joint investment to more than $100 million. 37 | Sustainability Report 2019 | Supporting New Zealand through sustainable tourism He waka eke noa | 38

03 Showcasing the best of regional New Zealand, all year round

We want to see all New our community partners to make the service Destination marketing campaign Zealand regions benefit a reality, signalling our ongoing support for 'Christchurch. Explore something new' Southland. It will mean the region is more was launched in May 2019 to inspire from sustainable tourism connected to New Zealand's most populous and encourage New Zealanders to visit growth and we are city and largest airport, will bring more visitors Christchurch during spring. The campaign to the region, and makes it easier for business focused on some of the beautiful locations committed to working with travellers to get to and from Southland. and great new culinary destinations in and councils, regional tourism around Christchurch. offices, airports, chambers Prior to the new service commencing, Air New Zealand, Great South (formerly More broadly, our domestic marketing of commerce and iwi to known as Venture Southland) and key campaigns have stimulated leisure demand build demand for regional Southland stakeholders launched the ‘Find by encouraging Kiwis to explore the country, yourself speechless in Southland’ campaign specifically encouraging shoulder season New Zealand. to showcase all that’s on offer in the region. travel. Our retail campaigns have promoted fares to regional destinations, and we With a slowdown in inbound tourism growth, At the other end of the country, we launched have undertaken awareness activity in we need to do more than ever to encourage a joint campaign with the Bay of Islands partnership with , Nelson Kiwis to visit this great country and support Marketing Group and Northland Inc. to attract Airport, Wellington Regional Destination regional tourism. Growing visitor numbers visitors to the Northland region outside of Agency, Destination Rotorua and Tourism outside of peak periods is an industry focus the peak summer months. Activities such as Bay of Plenty. to take the pressure off tourism infrastructure mountain biking around Waitangi, kayaking at the busiest times of the year. around Haruru Falls, exploring the caves of Motuarohia Island, and sampling some of the Our direct service between Invercargill and fine local cuisine were highlighted. Auckland started on 25 August 2019. We worked closely with and 39 | Sustainability Report 2019 | Supporting New Zealand through sustainable tourism He waka eke noa | 40

03 Working alongside Giving Kiwi youth a voice stakeholders in and inspiring a new Tairāwhiti Gisborne generation of storytellers

We continue to work alongside Activate Earlier this year, we signed a long-term Tairāwhiti and tourism stakeholders to boost partnership agreement with the National tourism in Tairāwhiti Gisborne. Geographic Society. As part of this Supporting tourism agreement, over the next two years we Two Māori cultural tourism offerings, Maunga will run Photo Camps in five different Hikurangi Experience and the Tairāwhiti New Zealand communities. Waka Hourua (double-hull sailing waka), deliver an authentic cultural experience for At these camps, young people, including and development in the region’s visitors. Both have received at-risk and underprivileged teens, will Qualmark Gold accreditation in their first learn how to use photography to tell their year of operation, recognising their high level own stories, explore the world around them of professionalism, sustainability practices and develop deep connections with others. and customer-centric approach. This is an With National Geographic photographers outstanding achievement so early on in their as their mentors, they are challenged to the regions development and operation. consider the difficult issues they face in their own lives, whether economic, environmental Getting the word out about these two new or social. Through presentations in their own experiences, as well as Tairāwhiti Gisborne communities and public exhibitions that reach as a ‘must visit’ tourism destination, remains millions of viewers, the students will share unemployment rate in some regions, and a This year we entered a long-term partnership with Queenstown a key priority, and we are developing a plan their perspective on these important issues. skills shortage in the tourism sector. Tourism Resort College’s (QRC) Tai Tokerau Paihia campus, which aims of partnership marketing activity to is New Zealand’s number one export earner stimulate visitation outside of the peak Since 2003, National Geographic has to build a tourism talent pipeline and career pathways for young and we need to invest in future leaders with summer months. run more than 80 photo camps in over 20 the drive and skills to deliver its continued people, including those from underprivileged backgrounds. It countries. The first New Zealand camp will success. A thriving, sustainable tourism be held in Murupara in the Bay of Plenty. focuses on youth in Tairāwhiti Gisborne, Te Tai Tokerau, South industry means a more prosperous country Auckland, the Bay of Plenty and the . for everyone.

Air New Zealanders will have the opportunity and, where possible, jobs for some graduates. to share their career journeys, expertise In July 2019 the first College intern started a and leadership with the College's tutors nine-month placement at Air New Zealand. and students. The top student from each graduation class will receive an Air New By promoting tourism as a career, and Zealand award and we will offer scholarship pathways into tourism, the partnership support, opportunities for paid internships addresses two key challenges: a high youth 41 | Sustainability Report 2019 | Supporting New Zealand through sustainable tourism He waka eke noa | 42

03 Tourism's role in protecting our environment

Flying endangered In our most popular tourist Bringing birdsong back to Encouraging responsible species locations, increasing visitor our iconic Great Walks tourism Our partnership with DOC means you may numbers are placing greater sometimes find yourself on a flight with a Our partnership with the Department In November 2018 we joined six other very precious passenger. In April this year we demands and pressure on of Conservation (DOC) as its National New Zealand organisations to launch Tiaki translocated our 3,000th wildlife passenger, Partner for Conservation is helping to protect — Care for New Zealand, an initiative that the natural environment a rare Okarito rowi kiwi chick named and restore biodiversity within some of New encourages international and domestic Caedance. We have partnered with DOC that New Zealand is famous Zealand’s most spectacular environments travellers to experience New Zealand in a since 2012 to transport some of the country’s alongside the Great Walks network. way that keeps everyone safe, protects our for. The tourism industry most threatened wildlife to new homes, as environment, respects our culture and takes has an important role to well as the conservation dogs who help We have supported over 31,000 hectares care of the country for future generations. monitor them. New Zealand has nearly 4,000 play in helping protect the of sustained pest control aiding the return threatened species, and they need more of native birdsong to these special places. It is built on the notion that travellers have environment and our precious help to ensure they have a brighter future. These biodiversity projects cover many of the both rights and responsibilities while native flora and fauna for well-known Great Walks that New Zealand travelling around Aotearoa. future generations. has become famous for including the Milford Track, Routeburn Track and Heaphy Track. We promote the content through our inflight entertainment screens, in Kia Ora magazine Our latest commitment with DOC is to fund and on our websites. Tiaki means to care and a four-year $400,000 project on the Paparoa protect in te reo Māori. Track Great Walk on the South Island’s West Coast that will assist the reintroduction and PANEL VOICE establishment of whio into the area while increasing knowledge of the biodiversity in Dr Susanne Becken the Paparoa Range. Sustainability Advisory Panelist

The Paparoa Track, a 55km walk due to open in December 2019, has been built for Air New Zealand’s place at the heart of Tiaki brings sustainability out from the mountain-bikers and walkers and is expected New Zealand’s tourism industry is unusual back-of-house, behind-the-scenes efforts to draw thousands of international and in a global context. When I look at other of individual industry players to harness the New Zealand visitors annually, providing countries, I can’t think of another example energy of the whole industry and, importantly, significant economic support to the local where the national carrier plays such a asks visitors to play their role. community. This track will provide access leadership role. Airlines are often the biggest into remote back-country areas, creating single player in a country’s tourism sector. The time seems right for this initiative; it hits a unique opportunity to increase the By bringing their scale, professionalism and public sentiment both in terms of visitors protection and management of biodiversity expertise to the table they can move the wanting to do the right thing and destinations surrounding the area. dial considerably more than smaller players wanting responsible tourism that adds value acting individually. In this regard Air New to their communities. It’s a fantastic Zealand is leading the way. framework to build from and Air New Zealand now has an opportunity to use its channels The Tiaki Promise launched last year by and influence to provide tangible advice and a coalition of tourism industry partners, options to travellers on how to be responsible including Air New Zealand, iwi, and the visitors in New Zealand. This is what I’ll be public sector, showed what this collaborative looking out for in the coming year. approach could yield. SUPPLY AND DEMAND Working with 1.1B 4,000 Over $1.1 billion spend More than 4,000 suppliers across our global supply our suppliers chain in 2019 1 04 NUMBER OF MEALS SERVED Our considerable Our suppliers are an integral We also work with New Zealand scale gives us the part of how we will successfully iwi and regional and sustainable drive sustainability across our producers to build their capability opportunity to business and contribute to a more to supply into corporate supply advance our environmentally sound and fairer chains and to give them a 6.3M 1.6M 24 New Zealand. platform for driving demand for Meals served globally New Zealand beef and lamb Food preparation sustainability agenda, their products and services at dishes enjoyed locations but the size and That’s why we have sharpened home and around the world. complexity of our our focus on strong supplier Helping these suppliers showcase partnerships based on shared their products to our customers supply chain means values and objectives. If our and employees is something we NGATI POROU FISHERIES we can’t do it alone. suppliers don’t understand why are really proud of. we are on this journey and share our commitments, our global supply chains will never reach their true potential. We are working to gain more visibility and assurance across all our 45,000+ supplier interactions. The airline prepared more than 45,000 appetisers featuring Ngati Porou's Ahia™ smoked fish

OUR SUPPLIER CODE OF CONDUCT

Percentage of suppliers (by spend 2) providing positive assurance of our Supplier Code of Conduct 88.7% 93.0% 93.2%

2017 2018 2019

BOTTLES OF NEW ZEALAND WINE SERVED SUPPLIER AWARDS

Tūhono Award (Supreme) Flight Interiors 963,232 45 | Sustainability Report 2019 | Working with our suppliers He waka eke noa | 46

04 04 Our Recognising approach our suppliers

To be a sustainable business, Our Supplier Code of Conduct, based on the standards in relation to the origin, quality Changing the status quo The aim of the Awards was to recognise and enabling us to develop and implement we must take responsibility United Nations Global Compact principles, and traceability of proteins, horticultural requires innovation and celebrate suppliers whose performance and low-impact alternatives to many of our sets out our minimum expectations of practices for fruit and vegetables, and relationship with us over the past year have inflight single-use plastic products. for what we purchase, the way suppliers for labour, human rights, the products that contain only sustainable we rely on our suppliers’ made a strong and sustainable contribution our products and services environment and ethical business. We have palm oil. We have partnered with caterers industry expertise to to the airline’s strategic objectives. It was also The Awards were a fantastic way to achieved positive assurance from suppliers to ensure animal welfare standards are in an opportunity to highlight the importance celebrate our suppliers’ contributions are used and how waste is representing 93.2 percent of procurement place, certification of proteins sourced in bring Air New Zealand’s of our supply chain to achieve sustainability to our business and the work we’ve disposed of. Our sustainable spend1 that they meet this code. New Zealand, and the identification of sustainability initiatives to outcomes such as waste reduction and done together. supply chain strategy and provenance through palm oil audits. life. This year we launched supply chain traceability. We are continuously improving our processes execution plan is governed by but recognise we still have much to do. This Our offshore catering supply chain is Air New Zealand’s Tūhono Ecoware was the winner of the Sustainability an Executive Steering Group year we incorporated options for the inclusion particularly complex, and in collaboration Supplier Awards with a & Ethical Practices Award. They are pioneers of sustainability considerations across our with our offshore caterers, discrete and experts in low-impact, compostable and led by a Sustainable procurement lifecycle, from how we request programmes of work are underway to identify formal awards and dinner packaging and have been instrumental in Supply Chain Working Group proposals to how we measure and track and report on their sourcing practices. event in August. Tūhono is to ensure effective focus supplier performance. Further embedding te reo for ‘standing together’. these within our teams’ practices is something Having a base of more than 4,000 suppliers and management of our we will be focusing on in the coming year. comes with challenges. This coming year sustainability initiatives. We have also improved our supply agreement we will be introducing digital tools to enable template to cover how we work with our and support a deeper understanding of Air suppliers when either of us believe the code New Zealand’s supply chain risk and drive is not being met. increased compliance with our sustainability standards. In addition to broadening supply Food and beverage sourcing is a particular chain compliance with Air New Zealand’s focus. Our catering partners continue to Supplier Code of Conduct, we are working work with us to understand and implement proactively with our strategic suppliers to requirements for sourcing sustainable ensure both parties’ sustainability goals are food products and proteins. This includes progressed through joint activity. 47 | Sustainability Report 2019 | Working with our suppliers He waka eke noa | 48

04 CASE STUDY

Ngati Porou partnership

A taste of Our partnership with Ngati Porou aims to generate further economic and social growth in Tairāwhiti Gisborne. We saw an opportunity to build a sustainable, self-reliant tourism region together and mutual value in being New Zealand able to procure regional products. Since September 2018 we have been serving Ngati Porou Fisheries Ahia™ smoked moki as a menu option in our Business Premier™ and Premium Economy cabins on some We have an opportunity Through our partnership with Tairāwhiti The positive impact on North American, Tasman and Pacific Islands to showcase the best of Gisborne and Ngati Porou, we are now services. And when Christmas came around serving sustainably caught fish from the our business has been the nation's regions to our at Air New Zealand, all of our employees region on some of our international flights. overwhelming with received a pot of Ngati Porou Tihi Honey in customers. We are the And during July, we shook up cocktail hour “ their regionally-themed Christmas gift box. largest server of wine in offering alcohol-free spirits from boutique a massive increase in Kiwi distillery Ecology and Co on flights We are proud to be working together to New Zealand and, apart between San Francisco and Auckland. online sales, emails showcase authentic New Zealand products from the champagne and to our customers and employees. In our lounges, we serve certified organic and personal visits to port served in our Business and Fairtrade coffee from Hummingbird and Premier™ cabin, we only continue to work with local businesses such our outlet in Gisborne as Loaf Handcrafted Breads to have their serve New Zealand wine. products integrated into selected lounge and the Gisborne menus. We’ve also showcased around 60 This includes a selection of the best wines different products such as licorice from Farmers Market from from around the country, including Māori Levin-based RJ’s Licorice, Bottled by the Sun visiting Air New and regional wineries. Through our juice from New Zealand’s only solar-powered continued partnership with Villa Maria juicer, the Chia Sisters, and lobster from iwi Zealand employees. wineries we collaborate on projects to producer Port Nicholson Fisheries. support shared sustainability goals, such Also, Air New Zealand as waste minimisation. Last Christmas we treated our 11,500 New Zealand-based employees with a regional employees from several We also support New Zealand wine growers sustainability themed gift, featuring products through our relationship with the Fine Wines from a number of up-and-coming regional and regions in New Zealand of New Zealand programme. We support Māori producers. The size of the order are now regular PARTNER VOICE events that showcase the best wines the as well as the considerable exposure to a country has to offer and we help wineries wide range of potential purchasers gave these online purchasers. Brett Johnston facilitate export opportunities. Our own wine local producers a well-deserved boost. Ngati Porou Holding Company Limited consultants work with the programme’s experts to ensure quality wine is served on Air New Zealand and Ngati Porou Holding We have clear and honest conversations with our flights and in our lounges. Our business has grown Company met for first the time in 2016 and Air New Zealand to make sure everyone is we took the time get to know each other, aligned on decisions and actions. Air New We have been working closely with iwi and as a result and the understand how each other operates and Zealand and LSG Chefs’ strict standards businesses to showcase more premium, get comfortable working together. for food safety and security have set a new homegrown product in our inflight menus. experience has better benchmark for our business. prepared us for future There is a significant opportunity for the provinces, including iwi, to partner with our Our burgeoning partnership with Air New large orders.” national carrier. Our partnership with Air New Zealand is a model for other iwi and regional Zealand has fast-tracked opportunities to producers to emulate. It’s great to be showcase our produce to whole new markets. working with such an iconic business that Vanessa Hayes, shares our passion for sustainability and General Manager regional wellbeing. Torere Macadamias Ltd SINGLE-USE PLASTIC Number of single-use plastic items being eliminated from Air New Reducing Zealand’s waste stream or replaced by lower-impact alternatives 1 waste & plastic 29M 15.5M 7.1M 1.5M

05 We continue to see Of course, great customer Unlike businesses that operate the phenomenal experience and sustainability on the ground, we cannot are not mutually exclusive. simply return to using heavier, rise of consumer Increasingly our customers reusable materials, as extra awareness and expect us to deliver the unique weight added to an aircraft has service we’re known for while a flow-on effect for fuel use and concern around taking a leadership position carbon emissions. Therefore, 550K 460K 200K single-use plastic around issues such as waste we need to be highly strategic products and the and plastic — after all, they are about who we purchase from and doing their bit to reduce waste what we purchase to ensure it impact of waste on and plastic in their lives. It’s a meets customer, regulatory and the environment. challenge we must rise to if we sustainability expectations. Our people are also are to ensure our future social licence to operate. International flights are also PROJECT GREEN pushing for change. subject to strict Customs and Items recovered in 2019 financial year from international biosecurity standards, adding flights arriving at and reinjected onto our a degree of complexity to how aircraft (diverted from disposal) we handle all international inflight waste.

11.3M

Tonnes TOTAL WEIGHT OF ITEMS REINJECTED ONTO OUR AIRCRAFT AS A RESULT OF PROJECT GREEN IN THE 2019 FINANCIAL YEAR 51 | Sustainability Report 2019 | Reducing waste and plastic He waka eke noa | 52

05 05 Plastic, Re-evaluating our not so fantastic waste targets

By the end of October 2019, Our initial commitment made in October Individual plastic sauce packets have also New Zealand faces At present we’re focused on reducing the New Zealand facilities - now we can recycle all directly procured, 2018 was to transition 24 million single-use been removed from Business Premier™ challenges when it comes amount of waste and plastic packaging two. There is also limited infrastructure, plastic items to lower-impact alternatives cabins on mainland and Hong we purchase at source, so we are less particularly in regional New Zealand, for single-use plastic items over the next 12 months. By the end of Kong services, and these will be eliminated to waste, in particular a reliant on having the appropriate end-of-life composting and diverting waste from landfill. used on domestic flights October 2019, we will have far exceeded entirely from our global network by the end lack of composting and facilities in place. The coming year will see As a result, we’re investigating the types of this, expanding the scope of the project to of October 2019. Customers will instead be a renewed focus on working closely with our products we purchase to make sure these will have been switched to transition 55 million single-use plastic items served sauce in reusable dishes which is recycling infrastructure. pool of 4,000 suppliers to drive changes in can be processed in existing New Zealand lower-impact alternatives1, across our global inflight network and ground expected to prevent around 200,000 plastic This is not a problem we can the packaging of products, including some waste facilities. and we will have rolled out locations including lounges, offices and packets going to landfill each year. solve on our own. A change customer-favourite inflight products. workshop locations. Alongside these challenges, there is more recyclable water cups and in New Zealand’s waste Recycling, composting and waste diversion we can do to change our own behaviour — coffee cups made from plants We’ve permanently withdrawn single-use infrastructure is required constraints as well as data integrity from reducing single-use product use at plastic water bottles from Business Premier™ challenges mean we have not achieved our ground sites to using the appropriate bins. across our global network, and Premium Economy cabins on Tasman before we, and the country, our waste reduction targets in the 2019 We are currently collecting further data and marking the completion of and Pacific Islands services under five hours, can take our waste reduction financial year and we are re-evaluating the developing revised targets in conjunction with the first phase of our plastic as well as from our Works Deluxe offering on efforts to new heights. targets for the next year and beyond. The our new waste management partner. This these flights. This is expected to divert more types of products we can divert from landfill data will be externally audited and we plan to reduction strategy. than 460,000 bottles from landfill annually through recycling systems have decreased announce new targets by the end of 2019. and reduce carbon emissions by more than significantly. Previously we were able to 300 tonnes per year by reducing weight recycle seven types of plastic in existing on the aircraft.

CASE STUDY EMPLOYEE VOICE Ecoware Alex Magaraggia Plastic Free July Campaign Tautalaaso Sonny Mataia Co-Founder & Director, Ecoware Travel Centre Consultant in Samoa

One of our key milestones this year It's been great working with Air New This year more than 600 Air New Zealanders We based our Plastic Free July efforts around was devising a strategy to reduce Zealand as we commence the war on took part in our employee-led Plastic Free the way our people lived before plastics single-use plastic use across the plastic by substituting single-use plastic July campaign. Our people took the challenge consumption was introduced to Samoa. We business. To do this, we worked closely products used on board with products to reduce their usage of single-use plastic emulated the way our ancestors ate, so we with product suppliers and our waste which can be reused or composted. We've very seriously and were able to win some wove coconut leaves into placemats and used management provider to ensure new been honoured to partner with them over great prizes as a result. One of the most taro leaves as plates. Coconuts were split in products coming into the business the course of the last 12 months to design impressive examples was our team based in two and used as bowls and cups. We used a could be composted or recycled in and manufacture custom plant-based Samoa, which arranged a fully catered meal Kava bowl to put our food in. existing New Zealand facilities. packaging which is unique, fit for purpose, to celebrate Matariki in traditional style using and certified compostable. zero plastics. These bowls are made from wood and can Ecoware was one supplier we closely last up to 30 years, unlike a plastic takeaway collaborated with, developing a fully bowl that is used for a few minutes and then compostable, bespoke cheese tray takes centuries to break down in landfill. We that is used on Koru Hour flights on decided to tie this in with Matariki because domestic routes. we felt that Matariki is a cultural celebration for our Māori brothers and sisters and we wanted to celebrate that as well as bring a bit of Samoan flavour to the celebration. 53 | Sustainability Report 2019 | Reducing waste and plastic

05 Working with partners to reduce waste

Project Green continues Working with our new to deliver waste management partner

One of our major international waste diversion Queenstown in August. We’re also excited to As we step up our focus on waste, this projects is the Project Green initiative, have introduced the initiative to our operation year we switched waste management launched in conjunction with the Ministry for in Los Angeles, our largest offshore catering contractors which has led to new ways Primary Industries and our catering partner port, in conjunction with our partner LSG Sky of working together. LSG Sky Chefs in July 2017. Chefs. This is the first time Project Green has been implemented outside of New Zealand. Waste Management NZ Limited will take In the 2018 financial year, 40 types of inflight co-responsibility for delivering on our products were reclassified so they can be Based on trials in the four new ports, we public waste targets and are providing reused on future flights if they are removed expect to divert around 111 tonnes of product full-time, in-house resource to work with from the aircraft sealed and untouched. from landfill annually. We are also able to us on minimising waste at source. Products include cans of soft drink, packets save costs which we can reinvest on other Together we are looking at the entire of cookies, boxes of tea, packets of coffee sustainable supply chain initiatives, with process holistically, from production and sugar sachets. To date we have less product waste going to landfill. Carrying through procurement to end-of-life. reinjected more than 280 tonnes of product only what we need reduces weight on the into our network and recycled more than aircraft and helps to reduce fuel burn and 302 tonnes of glass. This is equivalent to the carbon emissions. weight of 13 Airbus A320NEO aircraft. We plan to roll out Project Green in San In July 2019 we rolled out Project Green in Francisco, Chicago and Houston over the Wellington and Christchurch, followed by next 12 months.

EMPLOYEE VOICE PANEL VOICE Dan Watkins Sir Rob Fenwick Ramp team member, Auckland Domestic Airport Sustainability Advisory Panelist

I work in the Ramp team at Auckland As a result, the number of magazines printed Plastic refuses to leave centre the waste dilemma. Start with and advocate for the significant Airport — we’re responsible for loading and was reduced by around 2,000 copies each stage in the world’s war on waste. purchasing and consuming less shifts to national waste policy unloading cargo and baggage from aircraft month. Reducing the print run has resulted in In the Ministry for the Environment’s wasteful products — simply generate which are required alongside on arrival and before departure. around 10,800 kilograms less magazines per public surveys, it remains a top less waste in the first place. behavioural change. year being circulated. environmental concern for New Passengers expect change and Air Earlier this year several members of the Zealanders. That’s not surprising New Zealand has started by making On a final note — Air New Zealand’s team and I identified a surplus of magazines I’m really happy with the outcome, which has when we read plastic is now changes in its procurement inaugural Tūhono Supplier Awards were being delivered but not loaded onto saved on waste and cost for the company. detectable in fresh polar snow! approach. To enable full resource recently illustrated the multiples of aircraft each month and were subsequently And it’s been a great lesson in speaking up The global battle to minimise use recovery, such as for compostable influence that lie within the airline’s being thrown away. This was creating a lot of when something doesn’t seem right — I’m of plastic raises numerous threats organics, the airline will need to huge supply chain. It is waiting to unnecessary waste, so I got in touch with the one of around 12,500 employees globally, and and opportunities for Air New create new partnerships. be tapped into. Customers and Sustainability team to share my concerns. it’s a reminder that responsibility for making Zealand which, like other businesses, suppliers ultimately want to preserve changes sits with every one of us. has evolved alongside a highly Engaging a new waste management the world’s stock of natural capital innovative and useful plastic industry. partner in New Zealand presents as much as we do. It will happen opportunities to collaborate around quickly with a bit of leadership from For a start we must take a proactive, new targets, develop industry private and public sectors. as opposed to reactive, approach to standards on reusable materials 55 | Sustainability Report 2019 He waka eke noa | 56

Target Baseline Year 2017 2018 2019 Status Target Baseline Year 2017 2018 2019 Status

Increase representation • Product development project of Māori and Pasifika in implemented in Tairāwhiti Management positions 13% (FY18) 13% 15.4% which supported launch of • Product development project thorough the organisation two cultural tourism products to 20% by 2022 implemented to support (Mount Hikurangi and Waka capability to bring three cultural Hourua). Both tourism Recordable rate of injuries 1 tourism products to market experiences received Qualmark reducing by 15% year-on- Recordable rate of injuries of Recordable rate of injuries of 11.20 Recordable rate of injuries of Impactful projects Recordable rate of injuries (Mount Hikurangi, Waka Hourua year resulting in a rate of 15.22 and 288 employee injuries and 215 employee injuries (26% 10.30 and 179 employee injuries implemented in East Coast Gold accreditation of 15.22 (FY17) and Chardonnay Express) less than 10 by end FY20 (15% decrease from FY16) decrease from FY17) (32% decrease from FY17) (Tairāwhiti) and Northland New in FY18 • Strategic partnership with • Air New Zealand and Ngati Porou (against FY17) (Te Tai Tokerau) to drive Queenstown Resort College’s Initial activities underway partnership agreement signed social and economic benefit Paihia campus launched to 90% execution of Critical 25% of CRM Plans in place All critical risks and controls All critical risks and controls by end FY19 • Scoping of measurement support youth in regional New Risk Management Plans with controls tested (based New target in FY18 were registered in the Enterprise are registered in the Enterprise framework commenced Zealand meet their potential by with controls tested by on Critical Risks Gap Risk Register Risk Register (to measure social, economic fostering clear pathways into end FY20 Analysis) (FY17) and environmental progress study and employment in region) 1 Achieve an average • Ngati Porou smoked fish on Flourishing Scale score Establishing baseline board Tasman and Pacific 47.8 47.0 47.0 of 45 or better by end in FY17 Island flights FY20 against FY17 2 • Activities implemented in • Significant community activity 75% employee engagement Community activities 18 ports throughout the regions with by end FY20 implemented in every Airpoints™ for Schools with • Airpoints™ for Schools covered the involvement of Koru Care (Engagement survey sent New Zealand region 67% (FY14) 69% (FY16) 71% 71% (FY18) 10 schools selected in FY17 off all but 7 ports Dreamliner flight out bi-annually. The last Air New Zealand flies survey was in 2018. The to (20 ports) • Two ports were not delivered to • Airpoints™ for schools in 10 next survey will be in 2020) ³ — Blenheim and schools, located across 8 ports

50% Senior Leadership Team (SLT) female by 16% (Jan 2013) 39% 39% 44% Full compliance with No notified noise breaches in FY17 No notified noise breaches in FY18 No notified noise breaches in FY19 end FY20 ICAO noise standards Achieved full compliance with Achieved full compliance with Achieved full compliance with for aircraft fleet 70% of our SLT alumni ICAO noise standards ICAO noise standards ICAO noise standards attain Executive level, Non-Executive Director or 86% 86% 75% SLT roles in organisations Cargo provided support to MFAT, with New Zealand Interests Red Cross, and UNICEF during Cyclone Gita in Tonga Increase proportion of 276 employees participated in 497 employees participated 17 tonnes of humanitarian relief employees who participate New target in FY18 community programmes in community programmes in community programmes including, but not limited to, the following items: Members of Air New Zealand’s Red Cross supported to - Blankets Special Assistance Team (SAT) respond to all disasters Air New Zealand not called upon were deployed to assist Air New - Jerry Cans in New Zealand and the for response in FY17 Zealanders and their family and South Pacific - Kitchen Sets friends affected by the Christchurch - Solar Lamps Mosque attack - Mosquito Nets - Shelter Tool Kits - Tarpaulins - Generators 57 | Sustainability Report 2019 He waka eke noa | 58

Target Baseline Year 2017 2018 2019 Status Target Baseline Year 2017 2018 2019 Status

Increase number of Projects active on six Great Walks: Projects active on four Great Walks: Projects active on five Great Walks: customer journeys FY18 N/A (New in FY18) 130,282 183,624 Whanganui River Journey, Projects active on three Whanganui River Journey, Whanganui River Journey, Abel offset voluntarily Support six biodiversity Abel Tasman Coastal Track, Great Walks (Lake Abel Tasman Coastal Track, Tasman Coastal Track, Heaphy projects with DOC and iwi Heaphy Track, Milford Track, Waikaremoana on hold), Heaphy Track and Milford Track, Milford Track and Routeburn partners on New Zealand Paparoa Track and Routeburn 0.3% improvement compared 1.1% improvement compared 1.1% degradation compared species transfer programme Track (Lake Waikaremoana in Track (Lake Waikaremoana on Great Walks to end 2020 Track (Lake Waikaremoana on to FY16 to FY17 to FY18 fully supported (FY16) development). Species transfer hold).Species transfer programme 1.5% average annual hold). Species transfer 0.93t CO -e per revenue 20% improvement compared 21.4% improvement compared 20.3% improvement compared programme fully supported fully supported improvement in aviation fuel 2 programme fully supported tonne kilometre (FY09) to FY09 to FY09 to FY09 efficiency (2009-2020) 1 (2.5% average annual (2.4% average annual (2.0% average annual Third year of Antarctic Ecosystem First year of Antarctic improvement) improvement) improvement) Antarctic Ecosystems First year of Antarctic Ecosystems Second year of Antarctic project completed in FY19 by Ecosystems project Project delivered by project completed in FY17 by Ecosystem projects completed NZARI Scientists. Projects reported completed in FY17 by The Carbon Reduction Programme December 2019 NZARI scientists in FY18 by NZARI scientists relate to those completed by NZARI scientists The Carbon Reduction Programme saved almost 4,780,000kg of fuel December 2018

saved 3,633,950kg of fuel or or 15,084t CO2-e. This is comprised 11,468t CO2-e. This is comprised of the following initiatives: One environmental non- of the following initiatives: Acceleration altitude 574,600kg Lightweight LD3 Unit Load Devices compliance: underground fuel Carbon Reduction Acceleration altitude 415,936kg fuel (1,813t CO -e), Ground saved 1,128,014kgs of fuel or 3,553 2 tanks (at Auckland Engineering Programme implemented fuel (1,310t CO -e), Ground Power Power 2,637,000kg fuel (8,322t tonnes CO -e (new ground power 2 Zero environmental & Maintenance) failed to meet in line with IATA audit 2 2,015,000kg fuel (6,367t CO -e), CO -e), Lightweight LD3 Unit Load Maintain zero environmental Zero environmental Zero environmental procedures confirmed at Auckland 2 2 non-compliances as HSWA (Hazardous Substances recommendations Lightweight LD3 Unit Load Devices Devices 1,219,000kg fuel (3,847t non-compliances non-compliances as at end FY17 1 non-compliances as at end FY18 and Christchurch) at end FY15 Regulations) 1,128,014kg fuel (3,553t CO2-e) CO2-e), RNP(AR) approaches in and RNP(AR) approaches in Christchurch 152,000kg fuel A compliant above-ground Christchurch 75,000kg fuel (480t CO -e), and 197,000kg fuel tank will be operational by the 2 end of 2019 (237t CO2-e) (622t CO2-e) from on-board weight reduction IEnvA stage 2 certification via IATA (Core activities- 5% annual reduction in 8.8% reduction compared to FY16 0% reduction compared to FY172 6.5% reduction compared to FY18 electricity use against 56,210,433 kWh (FY11) Flight Operations & 2011 baseline 43% reduction compared to FY11 43% reduction compared to FY11 46% reduction compared to FY11 Corporate by end FY19) Maintained stage 1 IEnvA IEnvA stage 2 certification IEnvA stage 2 certification FY19 Target: IEnvA certification in FY17 achieved achieved 92% Electric Vehicles where recertification via IATA 100% electric vehicles in 100% Electric Vehicles where Complete data for entire light feasible with scope extended to light ground fleet (where 0% (FY15) feasible3 vehicle fleet not available for 2018 include all activities² feasible) 3 by end FY19 56% of full fleet are Electric Vehicles 4

60% electric Ground Service Equipment (where feasible) 3 by end 32% (FY15) 50.7% 51.5% 62.1% FY19 (85% by end FY20). Targets revised in FY19.

Sustainable Building Target Baseline Year 2017 2018 2019 Status Guidelines implemented across Property and Increase proportion of Infrastructure portfolio 25% (FY18) N/A (New in FY18) 25.0% 8.3% international visitors on by end FY19 with 20% of Air New Zealand travelling 45.7% * 48.4% 47.8% new lease agreements during shoulder season qualifying as green 3 leases by end FY19 relative to peak

82% diversion from landfill Promote Tourism New Achieved Qualmark Gold Award A project is in development at Auckland ground sites Zealand's Qualmark that would enable Air New 65% (FY15) 76.8% 73.4% 75.0% Investigating opportunities to by end FY19 (zero waste to certification and certified promote Qualmark organisations Zealand to promote and sell 5 landfill by end FY20) organisations through Air New Zealand channels Qualmark activities

75% diversion from landfill at non-Auckland ground 71.80% (FY17) 71.8% 68.3% 68.2% sites by end FY19 5

50% international inflight dry waste diverted from 49.60% (FY17) 49.6% 46.2% 43.0% landfill at Auckland by end FY19 Target Baseline Year 2017 2018 2019 Status

50% of domestic jet inflight 100% of suppliers providing Suppliers representing 88.7% Suppliers representing 93.0% Suppliers representing 93.2% waste diverted from landfill 28.80% (FY17) 28.8% 37.1% 39.6% positive assurance of our 0% (FY15) New Code of of our spend4 provided positive of our spend4 provided positive of our spend4 provided positive by end FY19 5 Supplier Code of Conduct Conduct launched assurance assurance assurance by 2020

Increase annual volume of New Zealand exports on 42,000 tonnes (FY17) 42,000 tonnes 41,000 tonnes 38,600 tonnes Air New Zealand