Managing in a changeable operating environment

The operating environment

While our primary focus is on achieving better environmental outcomes, we must also assess the implications of meeting higher environmental standards in terms of the changes in practices required by various sectors and the impacts the changes would have on those sectors. Issues related to the speed and management of change will need greater attention over the next three years. An emphasis on ways in which adaptation can occur and be supported will be required.

Environmental issues and perspectives now interface very strongly with many areas of the economy – economic development, farming, forestry, transport, energy, urban development, Māori development, and building and housing. As a consequence, the Ministry for the Environment is required to contribute to a wide range of policy issues that are led by other agencies and Ministers.

In addition, the Ministry has seen a significant growth in international work in recent years, largely related to global responses to climate change, development of international carbon trading markets, and the incorporation of environmental components in trade agreements.

All of these shifts require significant organisational responses. These are outlined in the section on Assessing Organisational Health and Capability.

Māori interests in natural resources

Māori and iwi are increasingly seeking to further their aspirations through the development and management of natural resources. The Ministry is working closely with iwi leaders to engage in the strategic issues related to natural resources policy and sustainability, including climate change, sustainable water programme and Resource Management Act implementation.

The Ministry is also working with Māori groups to further its understanding of these issues and to help improve outcomes for Māori as individuals and members of whanau, hapu and iwi.  The Ministry recognises the importance of achieving environmental outcomes for Māori. We are committed to demonstrating internal leadership that will ensure the views of Māori and iwi are considered in the development of environmental policy. The first priority for the Ministry is to develop partnerships with Māori to explore their aspirations.

Working in networked ways

Environmental outcomes are strongly linked to policy and practices in sectors such as agriculture, forestry, transport, and economic development, as well as being a key part of the activities of local government. To achieve its outcomes the Ministry will increasingly need to work in integrated ways with other agencies in central and local government. This enables different skills, perspectives and understandings to be more effectively aligned towards common goals.

Some good examples of this already exist; for example in the cross-government Emissions Trading Group in Wellington and the Government’s Urban and Economic Development Office (GUEDO) in Auckland. GUEDO now comprises 10 government agencies working closely with each other and local government to develop the potential of Auckland as a world-class city.

The Ministry also works strategically with local government to develop policy, standards and guidance at the national level and to provide support for consistent practice at the local level.

Key relationships for the Ministry include:

• government agencies

• local government, especially regional council chief executives and resource managers

• iwi chief executives and environmental managers

• business interests

• professional organisations

• environmental non-government organisations.

Working in more strategic and integrated ways implies that in the future the Ministry will need to work quite differently from the way it has worked in the past. In particular it suggests that:

• our staff may be working more as members of cross-disciplinary teams within the Ministry and across different agencies

• more Ministry staff are likely to be seconded to other agencies to assist with integrating environmental perspectives into the work of those agencies; while more staff from other agencies could be seconded to the Ministry to bring wider economic, social and sectoral perspectives to our work

• a more deliberate approach to the governance of cross-agency and cross-disciplinary processes will be required.

Risk management framework

In a dynamic and changing work context, the Ministry for the Environment will be investing in developing more strategic and systematic approaches to risk assessment and risk management.

In 2007/08 an internal auditor was appointed, reporting to the Chief Executive. To assist the Ministry in improving risk management, the internal auditor will establish an Assurance and Risk Committee and an internal audit schedule.

The Ministry is committed to developing a more integrated and consistent approach to risk management. Risks will be considered at an organisational level, a programme level and a project level. This will include more systematic identification and monitoring of risks. It will link to our investment in building strong project management and programme management skills and capabilities. It will be reflected in the establishment of more explicit governance arrangements that oversee key work streams and projects. Organisational risks are related to organisational capability and achievement of outcomes. The key risks are set out below:

Crown risk

Alongside the departmental risks mentioned above, there exists a significant financial risk with the Kyoto Protocol liability. This relates to our contribution under the Kyoto Protocol, through which New Zealand committed to reduce emissions in the period 2008 – 2012 down to the levels in 1990 or take responsibility for the excess emissions.

The provision for this liability is affected by key factors that include the exchange rate and the international price of carbon. Other factors influencing the position of this liability include changes in oil prices, the weather, economic growth and changes in forestry activities, all of which are outside of the Ministry’s control.