By Sarah Holden, Founder and Director, Oxygen Consulting
With the general election just around the corner, it's worth considering what a change of government might mean for the future of corporate sustainability in New Zealand.
It's tempting to think of sustainability as something that sits on the political left, with a left-leaning government more likely to prioritise climate action, environmental protection and social responsibility, and a right-leaning government more focused on economic growth, reducing compliance costs and creating a favourable environment for business.
I think the reality is more nuanced, particularly when we look at what actually drives businesses to invest in sustainability.
So, what might we expect to see under different political settings, and does it really matter who is in power?
Policy and regulation
Perhaps the most obvious area of difference is government policy and regulation.
A more left-leaning government might be expected to take a stronger regulatory approach to climate change, environmental protection and social issues. This could mean greater emphasis on emissions reduction, more ambitious climate targets, stronger environmental protections and greater expectations around corporate accountability.
A more right-leaning government might be more inclined to reduce regulatory requirements, particularly where these are seen to impose costs on businesses without delivering sufficient economic benefit. There may be greater emphasis on voluntary action, market-led solutions and ensuring regulation is proportionate.
Neither approach necessarily means businesses will do more or less on sustainability. But it could change the environment in which they operate, including the pace of regulatory change, the level of certainty businesses have when making investment decisions and the extent to which sustainability is driven by compliance rather than commercial opportunity.
We are already seeing some of this play out in New Zealand.
The future of mandatory climate-related disclosures (NZ CS) is a good example. Proposed changes to the regime, including significantly increasing the reporting threshold for listed issuers and removing managed investment scheme managers, have been agreed by Cabinet. However, the necessary legislative changes have yet to be passed. The existing requirements therefore remain in place, although the Financial Markets Authority has provided regulatory relief for affected entities in the interim.
The incoming government will ultimately influence how this progresses. It's an interesting debate because the question isn't necessarily whether climate risks and opportunities are relevant to businesses, but which businesses should be required to formally disclose them, and what the costs and benefits of that requirement look like.
The proposed Modern Slavery Bill provides a different example. It has received bipartisan support and progressed through the select committee process, but still has further parliamentary readings before it can become law. Addressing modern slavery and improving supply chain transparency are issues that extend beyond traditional political divisions.
These examples demonstrate that not all sustainability-related policy sits neatly on one side of the political fence.
Investment, infrastructure and economic growth
Government also has a significant influence on where investment flows and the infrastructure available to support businesses.
A government that prioritises the transition to a low-emissions economy may be more inclined to direct public funding towards renewable energy, electrification, public transport, energy efficiency and nature restoration. It may also use grants, incentives and co-investment to encourage businesses to adopt new technologies.
A more market-led approach might place greater emphasis on private sector investment, reducing barriers to development and allowing businesses to determine which technologies and infrastructure solutions make the most commercial sense.
The distinction is perhaps less about whether investment is needed and more about who pays, who carries the risk and which solutions are prioritised.
There is a compelling economic argument for getting this right. The Sustainable Business Council’s 2026 report, Driving Sustainable Growth, estimates that an innovation-driven, low-emissions economy could deliver an additional $22 billion in GDP per year by 2035, compared with a pathway relying only on the current carbon price.
Importantly, this isn't simply an argument about reducing emissions. It's about productivity, innovation, lowering business costs and improving New Zealand's competitiveness.
The report also highlights the importance of policy certainty. Businesses making significant capital investments need confidence that the policy settings underpinning those investments won't change substantially every three years.
This is relevant regardless of which party is in government. Businesses need reliable and affordable energy, transport networks, water, waste services and resilient infrastructure to operate and grow. They also need confidence that the infrastructure and investment environment will support their longer-term plans.
The role of business and finance
Perhaps the most interesting part of this discussion is what is already happening outside government.
The financial sector has increasingly considered environmental, climate and social factors as part of its assessment of risk and return. This isn't simply about meeting regulatory expectations or demonstrating responsible investment credentials. It's also about understanding the long-term viability of the businesses and assets being financed.
The Responsible Investment Association Australasia (RIAA) has played an important role in developing the responsible investment market in New Zealand, through research, industry collaboration, certification and the promotion of better investment practices. Its research demonstrates the growing scale of capital being managed with environmental, social and governance considerations in mind.
We're seeing similar developments in banking. ASB, ANZ, BNZ, Westpac and Kiwibank have all developed sustainable finance frameworks, products or lending initiatives to support businesses investing in areas such as renewable energy, energy efficiency, sustainable agriculture and improved environmental performance.
These activities aren't driven by government policy. Banks have commercial reasons to understand the sustainability performance of the businesses they lend to. Climate change, resource availability, supply chain disruption and changing market expectations can all affect a borrower's ability to operate and repay debt. There are also opportunities to support businesses investing in more efficient technologies and new markets.
And it's not just the financial sector. Port Nelson's investment in electrifying crane operations has delivered fuel savings, while DB Breweries' move away from coal to biomass-derived steam at its Washdyke brewery has reduced operating and maintenance costs alongside a significant reduction in site emissions. These are business decisions, not simply environmental statements.
For many businesses, sustainability is about reducing exposure to risks that could affect their operations, maintaining access to customers and markets, keeping pace with competitors and attracting and retaining good people. It can also strengthen reputation and relationships with customers, employees, investors and other stakeholders. None of these drivers disappear because a government changes.
Does it really matter who is in government?
Government has a significant influence on the operating environment for business. It sets policy direction, determines regulatory requirements, makes investment decisions and influences the incentives and infrastructure available to support economic activity.
A change of government could alter the pace and direction of the sustainability transition in New Zealand, the regulatory expectations placed on businesses and the level of public investment and support available.
But I don't think it necessarily follows that corporate sustainability will move backwards or forwards in line with the political pendulum.
Businesses operate in a global economy. They have international customers, investors, lenders, employees and supply chains. They're exposed to changing market expectations, technological developments, resource constraints and physical risks. Many of these influences are well beyond the reach of any one New Zealand government.
And while regulation can set the baseline, it doesn't determine the full extent of what a business chooses to do.
The distinction I'd make is between the sustainability agenda of government and the sustainability agenda of business - they overlap, but they're not necessarily the same.
For me, good business sustainability is about understanding the connections between social, environmental and financial performance. It's recognising that businesses depend on people, natural resources, infrastructure and functioning communities, and that managing these dependencies well is fundamental to long-term success.
Government can either help or hinder that progress through the choices it makes. But the commercial case for good sustainability management doesn't change at the ballot box.
The political environment may change, but businesses will still need to make decisions that protect their long-term performance, manage risk and position them for the future. This is what sustainability is, it’s running a well-managed business that will be around for the long term.