Close to 27,000 tonnes of carbon was voluntarily offset by customers in 2018 through the airline's FlyNeutral programme.
To cut waste more than 16 million individual items from on board the aircraft, such as sealed beverages and unopened snacks, have been recovered for reuse or recycling rather than going to landfill through the airline's Project Green initiative.
Last year the airline removed single-use plastic items from its aircraft and its lounges. The move is expected to save 260,000 plastic toothbrushes, 3000 straws, 7.1 million stirrers and 260,000 eye mask wrappers from landfill.
READ MORE; • Air NZ's green initiative leader.
The passenger experience award recognised the airline's SkyCouch, a row of economy seats that can be turned into a couch after takeoff on international wide-body planes. Passengers must pay for all three seats in the row.
Dubbed cuddle class, the convertable seats were introduced in 2011.
Changes last year include a dedicated infant harness enabling infants to stay lying down throughout the cruise phase of flight and a new infant pod which provides extra comfort and protection.
A modification to the existing adult seatbelt means it's now certified for two children to be able to share the Skycouch lying side by side.
Air New Zealand chief executive Christopher Luxon said the awards were "great recognition" of the efforts of staff at all levels.
"We've made good progress, but we know we need to continue building on this momentum. To also be recognised for our innovation and excellence in improving the customer experience is a real honour."
ATW editor-in-chief Karen Walker said Air New Zealand was a "remarkable, innovative and pioneering company".
She said the airline did not just set new standards for the airline industry, but for service industries globally.
The magazine has been published monthly for the last 50 years.
Among other awards United States ultra low cost carrier Spirit Airlines was named Value Airline of the Year and Dallas Fort Worth was named Airport of the Year.
Airline Market Leader went to airBaltic, a Latvian carrier which also won the award last year.
The judges said airBaltic has continued its fast growth and offers more than 70 connections from all three Baltic capitals, where it now has a 56 per cent market share.
The award for Aviation Technology Achievement, went to the Airbus A220, previously known as the Bombardier CSeries. The aircraft competes in the 100-seat to 150-seat market against Brazil's Embraer.
Judges said the A220 was on a new trajectory since becoming part of the Airbus portfolio.
The 45th ATW Awards will be presented on March 26 in New York.