The New Zealand government recognises that sustainable development principles should underpin its economic, social and environmental policies both domestically and internationally. “Sustainable development” integrates concern for social, economic and environmental issues, taking into account the long-term as well as short-term effects of policy decisions.

New Zealand's low population and limited industrial base means that environmental issues are generally less severe than in many other industrialised countries. Many of the big environmental issues for New Zealand are also economic and public health issues. More sustainable use of water, managing marine resources, reducing waste and improving energy efficiency are all essential for creating wealth and quality of life as well as for environmental sustainability. The decline of the country's unique plants, animals and ecosystems is New Zealand's most pervasive environmental issue. Programmes are in place or under development in these areas.

The Resource Management Act provides a national framework for addressing environmental issues, with local government having the major responsibility at a local level. During 2009, the government amended the Act to streamline and simplify processes and reduce costly delays for developers and investors while still maintaining necessary environmental protections.

A particular challenge for New Zealand relates to determining the most appropriate way forward in relation to climate change. This has both an international and a domestic perspective. New Zealand is a small country with a unique emissions profile as a result of the prominent place that land-use industries hold in the New Zealand economy. Particular challenges relate to abating agricultural emissions, which make up nearly 50% of New Zealand's greenhouse gas emissions. New Zealand could be affected by significant climatic change and the government is committed to assisting in the international climate change dialogue.

In 2008, the previous government introduced an emissions trading scheme for greenhouse gas emissions. In November 2009, the new government passed legislation making a number of changes to the New Zealand Emissions Trading Scheme to better balance the economic impacts with environmental objectives and more closely align the approach with that of New Zealand's major trading partners, most notably Australia.