When trying to create a new account connection, I get the following error when trying to create a new account saying the application needs authorization.
That means your mail server mailbox is requesting permission to allow eM Client to access your mailbox “which is normal” when your mailbox uses an eg: OAuth token where no username or password is required. This is how most new modern mail servers authorize.
Your server mailbox “also for some reason” optionally from your screenshot wants you to justify why your mail client needs access which is unusual,and not normal, but sounds like is a stipulation with your specific server mailbox.
So you will have to type or choose something before you click approve or allow access.
Yes, it is normally because the server admin has banned access to the server from all but specified applications. They need to approve eM Client, and then the account setup can be done again.
Is there a way to configure eM Client to bypass this issue?
It is not an error or issue. It is a restriction intentionally placed by your organisation on the server. You will need to ask them to approve eM Client, then try the account setup again.