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Factors driving and Constraining Organizational Sustainability


Notably, businesses are progressively more concerned with being eco-friendly because of pressures from numerous stakeholders and the community. It is said that the rising interest in sustainability is due to the increasing existence and surging awareness of ecological and socio-economic issues (Amankwah-Amoah, 2020). Undoubtedly, corporate organizations are deemed vital contestants for sustainable development. Business practices can lead both positively and negatively to sustainability (Mio et al. 2020). This report aims to discuss the concept of sustainability; and the assessment of three drivers of organizational sustainability in New Zealand. Moreover, it entails an assessment of three constraints of organizational sustainability in New Zealand. Besides, it will critically examine how the theory assists in understanding organizational sustainability action.

Concept of Sustainability

As opined by Amjad et al. (2021), sustainability is referred to as an open, coherent, unbiased, rational, and secure system that stimulates an individual’s growth. A study by Miceli et al. (2021) asserts that organizational sustainability indicates everything about incorporating the objectives of sustainable development in the functional environment of industries. Moreover, organizational sustainability is stipulated as adopting corporate approaches and practices that fulfill the desires of the company and its stakeholders in the present time while securing, preserving, and improving the human and natural resources that might be required in the future. It has been stated that organizations strive for sustainability by generating superior products and services, fulfilling client demands and desires, and refining profits while addressing environmental and social concerns. As per the study by Purvis et al. (2019), there are three dimensions of sustainability namely profit, planet, and people that represent economic, environmental, and social sustainability, correspondingly. These three dimensions are discussed below:

  • Economic: This dimension of sustainability implies a business’s influences on the economic situations of its stakeholders and economic systems at the native, nationwide, and international levels. The companies which attain competitive edges via economic, and non-feasible capabilities might thrive in the long term, though they cannot lead to economic systems at all levels.
  • Environmental: Environmental sustainability is described by the mixture of numerous business abilities or the entire efficiency of the company to lessen the overall carbon footprint of the goods. The elements of this dimension include green management; pollution; use of resources; natural atmosphere; and so on.
  • Social: It has been found that contemporary businesses pay special attention to the societal facets of sustainable development because of the pressure from stakeholders. This integrates the concepts of accessibility, equity, institutional stability, and cultural identity. The facets of social sustainability might address internal as well as external human resource concerns (Kristensen & Mosgaard, 2020).

Drivers of Sustainability

It is noteworthy that the clean green image of New Zealand is worth a lot of money to organizations. It is said that the economy of New Zealand is extremely reliant on its natural resources which lead to a massive proportion of its exports. Therefore, to certify sustainable economic development, such natural resources should be diligently managed for the welfare of present and future generations (Urlich & Handley, 2020). It has been found that New Zealand companies, because of the scarcity of natural resources, are confronted with pressure to undertake sustainability practices. Therefore, it can be said that the allocation of business resources is deemed vital for companies to implement sustainability initiatives. The availability of limited resources and the depletion of natural resources is deemed major driver for adopting sustainable initiatives (Sajjad et al., 2020). Given this driver, ANZ bank has considered the sustainability initiative of supporting its clients' transition to net zero emissions by 2050. This is done by supporting sustainability in resource extraction in areas like cobalt, iron, and more; supporting novel technology projects based on carbon capture usage; and supporting basic material production involving low-carbon aluminum production (Moylan et al., 2023).

New Zealand indeed has a net zero emissions target to be achieved by 2025. In line with this, it is paramount for New Zealand companies to be involved in voluntary actions intended to reduce energy consumption. It is found that employees are considered influential stakeholders and hence their attraction and retention are deemed as another driver for sustainability for New Zealand businesses. It can be said that employees might pressure companies to undertake sustainability practices to refine their sustainability efficiency. It is also asserted that employee engagement constructively impacts the sustainability efficiency of companies and their SCs (supply chains) (Raihan & Tuspekova, 2023). In respect of ANZ Bank in New Zealand, it can be said that the bank has a proactive strategy for employee engagement and wellbeing which drives its workforce retention and attraction. Therefore, the employees at ANZ pressure the bank to take care of their well-being, safety, and health (Cherrington et al, 2020).

There is no doubt that the conception of obligatory sustainability reporting has grown with the profound understanding of ecological and social threats for corporate New Zealand. Also, around 80 percent of the companies in New Zealand reported certain sustainability-related data that is driving organizations to perform sustainable practices. Furthermore, sustainability reporting is found as another major driver of corporate sustainability that can impact business actions in New Zealand Companies and therefore induce the execution of sustainable development goals into corporate strategy (Beerbaum & Puaschunder, 2019). It is found that ANZ bank has its ESG approach which emphasizes three vital aspects namely financial welfare, environmental sustainability, and housing in which the bank responds to intricate social issues fundamental to its clients and corporate strategy. The sustainability reporting of these areas drives ANZ Bank to be committed to fair and responsible banking practices (Sengupta et al., 2023).

Barriers to Sustainability

It has been found that major barriers to economic sustainability facing a company entail a lack of resources; lack of awareness; lack of workforce training and skills shortages; and more. Concerning New Zealand businesses, it is found that the barrier to economic sustainability is a lack of support from the government and customers. It was found that the nation's government is not playing a vital role in inspiring the topmost management of its businesses to endorse sustainability in the business. It is asserted that the SMEs in New Zealand indicated a lack of guidance and support from the government that stopped them from refining their sustainability practices (Mangal, 2022).

New Zealand has been successful in its commitments and progress toward social sustainability, but there exist certain barriers that prevent its businesses from attaining the targets. The people in this nation have been suffering from poor mental health (Hobbs et al., 2021). It has been found that the majority of existing houses in the nation are substandard which leads to poor and unhealthy living conditions for people. The causes behind the same entail a lack of regime rigid regulations on sustainable living standards; and other policies.

There are various environmental sustainability barriers facing the New Zealand nation. The barriers are in the form of climate change; loss of biodiversity; waste management; usage of energy; and so on. Concerning New Zealand businesses, it can be found that climate change is deemed a vital barrier to attaining equal health outcomes for Maori (Glavinovic et al. 2023). It is asserted further that climate change issues are vital for New Zealand businesses and civilians who have infused such considerations through policy making. It is found further that climate change impacts all producers, the communities that advocate it, and the wider NZ economy. The nation is considered a global leader in ecological norms with certain of the most strict regulations to secure its natural resources. Companies in New Zealand have been confronted with challenges in fulfilling environmental standards. They are finding complexity in certifying these possess sufficient resources to meet the norm. Further, they face difficulties in certifying obedience to regulations and laws. Besides, the businesses confront challenges in preventing pollution managing waste, and conserving water and energy.

Continuous refinement in ecological management and dedication to executing the greatest possible norms might assist New Zealand in contesting with other nations and usually surpassing them. Therefore, it can be said that with the correct policies, New Zealand might become a global leader in ecological sustainability (Bremer et al., 2019).

Evaluation of Theory: Stakeholder Theory

A stakeholder is described as any business or an individual that impacts or is affected by a business's actions. It is found that the stakeholders are classified as primary and secondary relying on their prospective influence on decision making and company existence. It is asserted that stakeholders offer companies a social license to function and form decisions. They compel the businesses to follow their desires. This theory reflects the need for management to be held liable to the numerous stakeholders to safeguard the interests of stakeholders. It is said that the higher management in a company might be required to meet the expectations of stakeholders and the necessity of the target market to fulfill their pertinent growth. It is found that stakeholder theory is deemed a vital component of corporate social responsibility in the open system wherein companies collaborate with society, diverse teams with their definite sets of desires, expectations, and demands customize each interaction (Harmoni, 2013).

It is asserted by Freudenreich et al. (2020) that companies might not be capable of attaining their sustainability goals without the engagement, expertise, knowledge, and trustworthiness of their various stakeholders. Numerous challenges to implementing sustainability practices might be eliminated by synchronizing the concept with stakeholder theory since it facilitates leaders to possess a more pragmatic strategy considering the interests of all kits stakeholders and scheduling their activities consequently. The stakeholder theory is found to address the problem of an absence of awareness of the benefits of sustainable practices. It can be said that the sustainability practices aligned with stakeholder theory produce the maximum benefits in terms of social development and developing a skilled workforce, superior business branding, greater sales, and profits, and more.

A study by Yang (2023) found that stakeholders have a significant impact on a business's decision to adopt integrated reporting for sustainability practices. It is found that for companies with various stakeholders such as Sanford (a New Zealand Company) fulfilling stakeholder expectations is vital to company success. A Case of New Zealand Post Company shows that business has adopted integrated reporting which led to concise sustainability reports. It inspired the company to demonstrate the role and revelation of human, societal, intellectual, and relation capital in this business. It is found that this organization preserves a dialogue-oriented relationship with its various stakeholders with whom it engaged in numerous manners as per the nature of the matters to be discussed and the kinds of stakeholders. To address the sustainability problems and ecological group necessities, the New Zealand Post serves to lessen the ecological impact in diverse manners concerning its distributors, clients, and suppliers. Moreover, this company has introduced sixty new electronic vans onto their fleets that might be useful for the stakeholders of this company in terms of reduced costs for fuel and an eco-friendly option for the contractors (Farneti et al., 2019).


From the above discussion, it can be concluded that the integration of sustainability practices into businesses has become a norm in current times. It is further inferred that the implementation of enduring sustainability practices is considered to be an intricate activity for businesses in New Zealand. The drivers of sustainability are concluded to be a scarcity of resources, employees' welfare; and sustainability reporting. Moreover, it infers that the barriers include a lack of government support; climate change issues; and the living conditions of people in New Zealand. It is also concluded that the stakeholder theory helps the businesses to understand the sustainability practices including its drivers and barriers.


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