File 68625

Centre for Development, Environment and Policy
P508
Environmental Auditing and Environmental

Management Systems
Prepared by William Sheate.
Reviewed and updated July 2014 by Dr Rocio A Diaz-Chavez.
SOAS | 3737
P508 Environmental Auditing and Environmental Management Systems Module Introduction
MODULE INTRODUCTION
ABOUT THIS MODULE

This module is intended to provide a broad understanding of environmental auditing
and environmental management systems (EMSs), including an understanding of the
increasing importance of corporate social responsibility and the use of standards for
environmental management by companies. The legal and procedural context is
focused especially on the European Union and UK context, but international
standards and benchmarks are also referred to throughout, such as those established
by the International Organization for Standardization (ISO) or international labelling.
Comparative analysis of other contexts is broadened to cover developing country
examples and other international perspectives.
Throughout the module a set of case studies is used to illustrate various aspects of
the environmental auditing and environmental management systems in different
contexts. These are developed as the module proceeds through the units, but can
also be reviewed, for example, for revision, as stand-alone case studies.
STRUCTURE OF THE MODULE

The module is divided into four parts, beginning with an introduction to auditing and
the legal context within which organisations must operate and why they need to
undertake environmental auditing. A distinction is then made between corporate
auditing (of organisations) and product auditing (products and services) where the
latter includes a wide range of assessment tools such as lifecycle assessment and
footprinting tools. The final part is concerned with standards particularly those
relating to international environmental management system (EMS) standards, such
as ISO 14001 and the EU eco-management and audit scheme (EMAS), and
developments beyond the environment to incorporate wider sustainability issues
under corporate social responsibility (CSR) and environmental and social reporting by
organisations. Throughout the module reference is made to a series of case studies
focused on different sectors, some particularly relevant to certain units rather than
others, but links are provided through specific activities within the units. You can of
course review the case studies on their own, outside the specific unit links, which is
particularly useful when revising and integrating the material across the units. Other
examples are used throughout as well.
Priority topics are environmental auditing, corporate auditing, product auditing and
understanding the role of standards for environmental assessment and
environmental management systems.
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WHAT YOU WILL LEARN
Module Aims
The module sees auditing as part of wider environmental and sustainability
management, and recognises the increasing importance of other tools and
techniques such as lifecycle assessment (LCA) and ecological and carbon footprinting
to environmental management in organisations and for products and services. The
module explicitly addresses corporate auditing (in the private and public sector) and
product auditing, and this leads into LCA and footprinting techniques and wider
issues around corporate social responsibility and reporting.
The specific aims of the module are:
To provide an understanding of how to identify and evaluate the environmental

impacts of an organisation or product/service.
To provide an understanding of how the environmental impacts of an

organisation can be managed within the context of an environmental
management system.
To provide a basis for the practical application of environmental auditing and

environmental management systems.
To provide an awareness of the range of available environmental management

tools and techniques.
To examine how corporate environmental management may respond to the

challenge of sustainable development.
Module Learning Outcomes

After completing this module students should be able to:
define environmental auditing and describe the main components of the

environmental auditing process
identify methods for auditing specific environmental issues associated with the
activities of an organisation and product/service
describe the main components of an environmental management system
understand key principles underpinning a range of environmental management
tools and techniques
assess critically the use and application of environmental auditing and
management tools.
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STUDY MATERIALS
Textbook
There is one textbook for this module:
Brady, J., Ebbage, A. & Lunn, R. (Eds.) (2011) Environmental Management in

Organizations: The IEMA Handbook. 2nd edition. London, Earthscan.
Key Readings
For each of the ten units Key Readings are provided. These comprise academic
articles, company reports, and guidance documents produced by international
agencies. Selected papers from Sheate, W.R. (Ed.) (2010) Tools, Techniques &
Approaches for Sustainability: Collected Writings in Environmental Assessment Policy
and Management, are also included. You are expected to study the Key Readings as
they contain material which may be used in examination questions.
Case studies
The case studies covered relate to specific sectors and explore particular aspects
covered in the module in more detail. Not all case studies therefore, relate to all or
the same parts of the module.
Each case study has a number of resource documents (eg CS5-Res1) associated with
it which are provided as PDF files alongside the case studies in the e-version of your
study guide. The case studies are:-
CS1 Construction sector (looking at the environmental impacts

associated with for example, the cement industry and house
building) and how to manage those impacts.
CS2 Electrical and electronic sector (examining for example, major

retailers such as Siemens and Nokia and regulation concerning
wastes from electrical appliances from refrigerators to laptops).
CS3 Hospitality sector (eg impacts and practices of the travel and
tourism and hotel sectors).
CS4 Local authorities (eg examples of municipalities using best practice

in environmental management).
CS5 Retail sector (examining the performance of key retailers such as

IKEA and Boots).
CS6 Sustainable clothing (a specific aspect of manufacturing and retail

where international trade, for example, in cotton, highlights both
the role of consumer choice and producer responsibility.
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Further Readings
For each of the ten units, Further Readings and References are also listed. These
texts are not provided but many are available on the internet. Students are not
expected to follow up each and every Further Reading, but can follow up specific
points of interest. They aim to provide a range of perspectives and more depth on
the unit subject matter.
Key Terms and Concepts and Acronyms

At the end of each unit you are provided with a list of Key Terms and Concepts which
have been introduced in the unit. The first time these appear in the text guide they
are Bold Italicised.
As you progress through the module you may need to check unfamiliar acronyms
that are used. A full list of these is provided for you at the end of the introduction.
Multimedia
This video is available on your e-study guide.
William Sheate, Ric Eales, Clare Twigger-Ross and Laurence

Smith (2010) Environmental Management in Practice.
Video recorded on 8 December 2010 at SOAS. William, Ric and Clare

speak to Laurence about their professional experiences in the field
of environmental management.
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ASSESSMENT
This module is assessed by:
an examined assignment (EA) worth 20%
a written examination in October worth 80%
Since the EA is an element of the formal examination process, please note the
following:
(a) The EA questions and submission date will be available on the Virtual Learning
Environment.
(b) The EA is submitted by uploading it to the Virtual Learning Environment.
(c) The EA is marked by the module tutor and students will receive a percentage
mark and feedback.
(d) Answers submitted must be entirely the students own work and not a product
of collaboration. For this reason, the Virtual Learning Environment is not an
appropriate forum for queries about the EA.
(e) Plagiarism is a breach of regulations. To ensure compliance with the specific

University of London regulations, all students are advised to read the
guidelines on referencing the work of other people. For more detailed
information, see the User Resource Section of the Virtual Learning
Environment.
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IEMA INSTITUTE OF ENVIRONMENTAL MANAGEMENT & ASSESSMENT

IEMA is the leading professional body that can support your studies and professional
practice relating to this module. It is the professional membership body for
promoting best practice standards in environmental management, auditing and
assessment for all industry sectors. The Institute offers ongoing support to
environmental professionals and aims to promote sustainability through improved
environmental practice and performance. With a membership over 15,000 individual
and corporate members based in 83 countries, IEMA is the leading international
membership-based organisation dedicated to the promotion of sustainable
development, and to the professional development of individuals involved in the
environmental profession, whether they work in the public, private or non-
governmental sectors.
IEMA is the Competent Body in the United Kingdom for EMAS the European Union's
Eco-Management and Audit Scheme and also offers the Acorn Scheme, an officially
recognised EMS standard recommended by the government. Acorn offers accredited
recognition for organisations evaluating and improving their environmental
performance through the phased implementation of an environmental management
system (EMS).
Resources and benefits for IEMA members include the following:
Published by IEMA 20 times per year, The Environmentalist magazine is a
leading UK environmental publication. It is sent, free of charge, to all members
and to an increasing subscriber base. The magazine contains a wide range of
up-to-date information, best practice, policy changes and news on
environmental issues.
The IEMA 'Perspectives' series provide detailed guidance on what constitutes a
good practice approach to Environmental Assessment. The first in the series,
Guidelines for Landscape and Visual Impact Assessment, was published in
2002. This has been followed by Guidelines on Participation in Environmental
Decision Making and Guidelines for Environmental Impact Assessment. The
Practitioner best practice series covers a further range of environmental topics
in detail, and is a source of practical guidance for environmental professionals.
Attendance at regional and national events, workshops, professional indemnity
insurance, website, special interest groups, international networks and career
information for individuals looking to work in the environment.
As a professional body for practitioners involved in environmental management
and assessment the Institute also supports members by providing recognition
of knowledge and skills through professional qualifications and through
provision of IEMA Approved Training Courses. IEMAs portfolio of training
courses is always expanding to ensure that new developments in the
environmental field are provided for.
Support for Continuing Professional Development (CPD) is also an essential way to
keep up-to-date with the latest issues and developments in the environmental arena.
CPD usually takes the form of training courses and workshops but can sometimes
mean individual study and research. Professional bodies like IEMA ask members with
professionally recognised levels of experience to keep a record of their CPD to
maintain their status and high standards of competence throughout the industry.
CPD workshops are a great way of keeping abreast of best-practice, fast-moving
legislation changes and new procedures in an educational and inclusive environment.
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INDICATIVE STUDY CALENDAR
Part/Unit Title Study time

(hours)
PART I Introduction to Environmental Auditing
Unit 1 Introduction to Environmental Auditing and 10

Environmental Management Systems
Unit 2 Types of Environmental Audit: the Legal Context 15
PART II Corporate Auditing
Unit 3 Corporate Auditing: Procedures and Methods 20
Unit 4 What to Audit: Environmental Impacts and 15

Performance
Unit 5 What to Audit: Emissions and Other Impacts 15
Unit 6 What to Audit: Resource Use and Waste Minimisation 15
PART III Product Auditing
Unit 7 Lifecycle Assessment 10
Unit 8 Sustainable Products and Services 10
PART IV Standards
Unit 9 Environmental Management System Standards 10

(EMSSs)
Unit 10 Other Standards and Reporting (CSR, GRI) 15
Examined Assignment 15
Check the Virtual Learning Environment for submission deadline
Examination entry July
Revision and examination preparation September
End-of-module examination October
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ACRONYMS AND ABBREVIATIONS

AA1000AS AccountAbility quality assurance standard for benchmarking CSR
performance
ACCA Association of Chartered and Certified Accountants
AITO Association of Independent Tour Operators
AP acidification potential
BAT best available technique
BP British Petroleum
BRE Building Research Establishment
BREEAM Buildings Research Establishment (BRE) environmental assessment method
BREFs BAT reference documents
BS British Standard
BSH Bosch und Siemens Hausgerte GmbH
BSI British Standards Institute
CACP Clean AirCool Planet
CDP Carbon Disclosure Project
CFC(s) chlorofluorocarbon(s)
CFV carbon footprint verification
CIRIA Construction Industry Research and Information Association
CO2 carbon dioxide
CQI Chartered Quality Institute
CSI Cement Sustainability Initiative
CSR corporate social responsibility
db(A) Decibel (using the A frequency-weighting) unit of noise measurement

used particularly for measuring environmental noise.
DEFRA Department of Environment, Food and Rural Affairs
EC European Community
EEA European Environment Agency
EIA environmental impact assessment
EIS environmental impact statement
ELD Environmental Liability Directive
ELV end of life vehicle
EMAS eco-management and audit scheme
EMS environmental management system
EMSS environmental management system standards
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EPA Environmental Protection Agency
EPR extended producer responsibility
ERP enterprise resource planning
ES&H environment, safety and health
ETS emission trading system
EU European Union
EWHC High Court of England and Wales
FLO Fairtrade Labelling Organization
FoE Friends of the Earth
FSC Forest Stewardship Council
GEMI Global Environmental Management Initiative
GHG greenhouse gas
GHI Green Hotel Initiative
GOTS Global Organic Textile Standard
GRI global reporting initiative
GWP global warming potential
GWT global water tool
HMSO Her Majestys Stationery Office
HSH Hong Kong and Shanghai Hotels
IBM international business machine
ICC International Chamber of Commerce
IEA International Energy Agency
IEC International Electrochemical Commission
IEMA Institute of Environmental Management and Assessment
ILCD International Reference Life Cycle Data System
ILO International Labour Organization
INTOSAI International Organization of Supreme Audit Institutions (INTOSAI) Working

(WGEA) Group on Environmental Auditing (WGEA)
IPCC Intergovernmental Panel on Climate Change
IPPC Integrated Pollution Prevention and Control
ISO International Organization for Standardization
IT information technology
IUCN The World Conservation Union
kHz kilohertz
KPI key performance indicators
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LCA lifecycle assessment
LCI lifecycle inventory
LCIA lifecycle impact assessment
LED light-emitting diode
LEED leadership in energy and environmental design
M&S Marks and Spencer
MEA Millennium Ecosystem Assessment
MRF material recycling facility
MSW municipal solid waste
NFB National Film Board
NGO non-governmental organisation
OECD Organisation for Economic Cooperation and Development
OPEC Organization of the Petroleum Exporting Countries
OPRL on pack recycling labelling
PAS Publicly Available Specification
PCBs polychlorinated biphenyls
PI professional indemnity
R&D research and development
RT responsible travel
SAIC Scientific Applications International Corporation
SEC Securities and Exchange Commission
SETAC Society of Environmental Toxicology and Chemistry
SGS Socit Generale de Surveillance
SIWI Stockholm International Water Institute
SMART specific, measurable, achievable, realistic, timely
SME small- and medium-sized enterprise
SR social responsibility
SWMP site waste management plan
SWOT strengths, weaknesses, opportunities, threats
TQEM total quality environmental management
TQM total quality management
UAE United Arab Emirates
UK United Kingdom
UN United Nations
UN/DESA United Nations Department of Economic and Social Affairs
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UNEP United Nations Environment Programme
UNESCAP United Nations Economic and Social Commission for Asia and the Pacific
USA United States of America
USSR Union of Soviet Socialist Republics
WBCSD World Business Council on Sustainable Development
WCED World Commission on Environment and Development
WEEE waste electrical and electronic equipment
WGEA Working Group on Environmental Auditing
WMR waste management regulations
WRAP Waste and Resources Action Programme
WRATE waste and resources assessment tool for the environment
WRI World Resources Institute
WSSD World Summit on Sustainable Development
WTO World Trade Organization
WWF Worldwide Fund for Nature
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Unit One: Introduction to Environmental Auditing
and Environmental Management Systems
Unit Information 2
Unit Overview 2
Unit Aims 2
Unit Learning Outcomes 2
Unit Interdependencies 2
Key Reading 3
Further Reading 3
References 4
Case Studies 6
1.0 Organisations and the environment 7
Section Overview 7
Section Learning Outcomes 7
1.1 Relationship between organisations and the environment 7
1.2 Public awareness 8
1.3 Sustainable development 11
1.4 Environmental management 14
Section 1 Self Assessment Question 16
2.0 Environmental auditing 17
Section Overview 17

2.1 What is environmental auditing? 17
2.3 Introduction to the types of audit 21
2.4 Why would an organisation wish to undertake an environmental audit? 23
Section 2 Self Assessment Questions 30
3.0 Benefits and costs of environmental auditing 31
Section Overview 31

3.1 What are the main benefits and costs? 31
3.2 Role of an environmental audit within an environmental management
system 33
3.3 Evolution of environmental audits 34
Section 3 Self Assessment Question 35
Unit Summary 36
Unit Self Assessment Question 37
Key Terms and Concepts 38

P508 Environmental Auditing and Environmental Management Systems Unit 1
UNIT INFORMATION
Unit Overview
This unit provides an introduction to the subject of environmental auditing and
management. It starts by making you aware of the concepts on which environmental
auditing is based. These include introducing the relationship between organisations
and the environment within which they operate, and the problems this can cause;
public awareness; sustainable development; and environmental management. The
unit then goes on to define environmental auditing and introduces the key words
associated with the subject. A brief history of environmental auditing is also
provided. The last part of this unit looks at the main reasons why organisations
undertake environmental audits. Each of the reasons is discussed in turn, and the
objectives and benefits of environmental auditing are analysed. The unit also
introduces the concept of environmental management systems (EMSs) and how
auditing fits within them.
Unit Aims
To introduce the subject of environmental auditing and management.
To provide an awareness of the concepts on which environmental

auditing is based.
Unit Learning Outcomes

By the end of this unit, students should be able to:
recognise the relationship between organisations and the environment
explain what environmental auditing is and how it originated
describe the benefits of environmental auditing and how it fits with the wider
environmental management responsibilities of an organisation
assess critically the benefits of environmental auditing.
Unit Interdependencies
This unit links to Unit 2 which provides more detail on the types of audit and on the
legislation relevant to companies.
Case studies on the Construction Sector; the Hospitality Sector; the Electrical and
Electronic Sector.
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KEY READING
Section 1
Brady, J. (2011) The response of organizations. In: Brady, J., Ebbage, A. & Lunn,
R. (Eds.) Environmental Management in Organizations: The IEMA Handbook. 2nd
edition. London, Earthscan, pp. 251260.
This is the main supporting text for the module Chapter 3.1 in particular, provides
background to this unit.
Section 2
Gensburg, L.J., Pantea, C., Fitzgerald, E., Stark, A., Hwang, S-A. & Kim, N.
(2009) Mortality among former Love Canal residents. Environmental Health
Perspectives, 117 (2), 209216.
This article provides background information on a key case in the US that prompted
environmental liability legislation.
FURTHER READING
DEAT. (2004) Environmental Auditing. Department of Environmental Affairs and

Tourism (DEAT), Pretoria. Integrated Environmental Management Information Series
No: 14.
Available from:
https://www.environment.gov.za/sites/default/files/docs/series14_environmental_au
diting.pdf
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REFERENCES
BBC News online (Wednesday 18 July 2007) Cement Firms Pollution Fine
Cut. [Online].
Available from:
http://news.bbc.co.uk/1/hi/england/coventry_warwickshire/6904850.stm
[Accessed 14 August 2014]
Crump, A. (1991) Dictionary of Environment and Development: People, Places,

Ideas and Organizations. London, Earthscan.
Dagg, S. (2005) C108 Environmental Auditing. Module prepared for the Distance
Learning Programme, Imperial College London.
Drexhage, J. & Murphy, D. (2010) Sustainable Development: From Brundtland to Rio

2012. United Nations Headquarters, New York. Background Paper prepared for
consideration by the High Level Panel on Global Sustainability at its first meeting, 19
September 2010.
Available from:
http://www.un.org/wcm/webdav/site/climatechange/shared/gsp/docs/GSP1-
6_Background%20on%20Sustainable%20Devt.pdf [Accessed 14 August 2014]
Gensburg. L.J., Pantea, C., Fitzgerald, E., Stark, A., Hwang, S-A. & Kim, N. (2009)
Mortality among former Love Canal residents. Environmental Health Perspectives,
117 (2), 209216.
Humphrey, N. & Hadley, M. (2000) Environmental Auditing. Bembridge, Isle of

Wight, Palladian Law Publishing Ltd.
Hunt, D. & Johnson, C. (1995) Environmental Management Systems. London,

McGraw Hill.
ICC (1991) ICC Guide to Effective Environmental Auditing. International Chamber of

Commerce (ICC), Paris. ICC Publication No: 483.
ICC (1989) Environmental Auditing. June 1989. International Chamber of Commerce

(ICC), Paris. ICC Publication No: 468.
Meadows, D.H., Meadows, D.L., Randers, J. & Behrens III, W.W. (1972) The Limits
to Growth. New York, Universe Books.
Smets, H. (1988) The cost of accidental pollution. Industry and Environment,

11 (4), 2833.
The Times 100 (2010) Business Objectives, Planning and Stakeholders. [Online].
The Times 100 Business Case Studies.
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UN. (2014) United Nations Conference on Sustainable Development, Rio+20.

Sustainable Development Knowledge Platform.
Available from: http://sustainabledevelopment.un.org/rio20.html [Accessed 14

August 2014]
UN. (2002) World Summit on Sustainable Development (WSSD). Johannesburg 26

August to 4 September 2002, United Nations (UN).
Available from: http://www.un.org/events/wssd/ [Accessed 14 August 2014]
UN. (1992) Agenda 21. Earth Summit. The United Nations Programme of Action
from Rio. Division for Sustainable Development, United Nations Department of
Economic and Social Affairs (UNDESA).
Available from:
http://sustainabledevelopment.un.org/content/documents/Agenda21.pdf
UN/DESA. (2003) Johannesburg Declaration on Sustainable Development. United

Nations Department of Economic and Social Affairs (UN/DESA).
Available from: http://trade.ec.europa.eu/doclib/docs/2004/april/tradoc_116827.pdf

UNESCAP. (2005) Environmental sustainability under threat. In: State of the

Environment in Asia and the Pacific, United Nations Economic and Social Commission
for Asia and the Pacific (UNESCAP), pp. 17130.
Available from: http://www.unescap.org/sites/default/files/SOE2005fullmainpub.pdf

WCED. (1987) Our Common Future. World Commission on Environment and

Development (WCED), Oxford Paperbacks.
Wikipedia (n.d.) List of Environmental Disasters. [Online].
Available from: http://en.wikipedia.org/wiki/List_of_environmental_disasters

Wikiquote (n.d.) Albert Einstein. [Online].
Available from: http://en.wikiquote.org/wiki/Albert_Einstein [Accessed 14

August 2014]
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CASE STUDIES
Case Study 1 Construction Sector.
Section 1.1 provides an illustration of the benefits a company might gain from
environmental auditing.
Case Study 2 Electrical and Electronic Sector
Section 2.1 provides an illustration of the ways in which this sector interacts with
the environment.
Case Study 3 Hospitality Sector
Section 3.1 provides an illustration of the ways in which this sector interacts with
the environment.
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1.0 ORGANISATIONS AND THE ENVIRONMENT
Section Overview
To provide an understanding of the relationship between organisations and the
environment and the pressures and effects each has on the other.
Section Learning Outcomes

By the end of this section, students should be able to:
recognise the effects of an organisation on the environment and vice versa
identify the different pressures on organisations to improve their environmental

performance.
1.1 Relationship between organisations and the

environment
To understand the development of the concept of environmental auditing, we first
need to look in more detail at the relationship between organisations and the
environment within which they operate. First of all we will examine this at the
macro-scale, that is, in terms of global developments in environmental thinking,
and then we will look at how this has affected individual organisations at the micro-
scale, that is, local level.
How should we view the relationship between organisations and the environment?
The relationship is two-way, with each having the ability to affect the other.
Organisations affect the environment in many ways. There are direct effects, for
example:
accidental spillage of oil from the refinery may cause pollution of a watercourse
local air quality may decrease due to emissions released from the oil
refinerys stack
water and energy consumption.
There are also indirect effects, for example:
the environmental impact of the finished product petrol or plastics
traffic generated by employees of the oil refinery may contribute to pollution on

local roads
waste produced after the end of the products life
environmental taxes such as the Landfill Tax and the Climate Change Levy in
the United Kingdom (UK) have an impact on the cost structure of companies.
Even though they are not direct environmental effects, they are environment-
related economic effects designed to reduce the environmental impact of an
organisation.
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The environment affects organisations in many ways, such as:
climatic changes and its relationship to fossil fuel use
laws aimed at protecting the environment (eg those governing air pollution)
may place constraints upon an industry and require capital outlay for new
equipment.
Historically, environmental problems have often been created or exacerbated by

business and industry. Pollution of rivers and watercourses by sewage generated
within urban conurbations has long been a problem, and growth in
chlorofluorocarbon (CFC) pollution, the presence of dioxins in the food chain, and the
burden of hazardous wastes are all evidence of the rapid rate at which industry has
developed and the manner in which this has happened. The worlds first national
public pollution control agency, the Alkali Inspectorate, was established in Britain in
1863 to control atmospheric emissions, primarily from the caustic soda industry.
Most countries in the world now have substantial (and ever-increasing) amounts of
environmental legislation, which aim to control the effects of organisations on the
environment. At the European level, there is also the European Environment Agency
(EEA), which aims to improve the quality of the environment in Europe through
supporting national policies and monitoring and reporting on harmonised standards
and regulations EU-wide. The United Nations Environment Programme (UNEP) and its
various programmes, especially the Industry and Environment Programme in Paris,
perform a similar, but global, role.
Read the Key Reading from Environmental Management in

Organizations: The IEMA Handbook by Brady (2011) and then look at
the Introduction sections for the following two case studies: the
Electrical and Electronic Sector case study (CS2) and the Hospitality
Sector case study (CS3) which summarise some of the key interactions
between these types of organisations and the environment.
1.2 Public awareness

More recently, public pressure over environmental issues has created a new set of
constraints acting upon industrial production. It is difficult for industry to deny its
role in damaging the environment or to refute the need for environmental protection.
Growing public concern over environmental issues means that decision makers can
no longer assume that the public will continue to tolerate continuing environmental
exploitation and degradation. Public concern over activities which were damaging the
environment led to the establishment of several environmental groups in the late
19th century the first British environmental group was the Commons, Open
Spaces and Footpaths Preservation Society, in 1865. Others soon followed, for
example, the Sierra Club in the United States of America (USA) began in 1892, and
most of the groups were concerned with protecting open spaces and buildings of
historic interest for public enjoyment.
The growth in public awareness of environmental issues was therefore largely
western-led. The publication in the early 1960s of Silent Spring by American author
Rachel Carson is widely regarded as the watershed of public opinion. This book
detailed for the first time the impact of chemicals, particularly those used in
agriculture, on the environment and human health. The major events of the 1970s
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were the two oil crises, where actions by the Organization of the Petroleum Exporting
Countries (OPEC) caused oil prices to triple during 19731974, and again between
1978 and 1980. This brought a realisation of just how dependent industrial societies
were on fossil fuel energy, and generated a huge growth in environmental
awareness. The environmental implications of resource use were also highlighted in
the influential Limits to Growth Report of the Club of Rome (Meadows et al, 1972),
which coincided with the 1973 oil crisis. Environmental pressure groups began to
increase in popularity, and Green political parties began to gain votes.
The series of high-profile incidents involving industry during the 1980s once again
increased the publics awareness of environmental issues and brought the
environment to the top of the political agenda worldwide. Disasters such as those at
Bhopal and Chernobyl undermined public confidence in certain sectors of industry
and forced the activities of industry and the subsequent damaging consequences for
the environment into the spotlight. Further details on the two incidents mentioned
above are presented in 1.2.1 and 1.2.2.
1.2.1 Bhopal high-profile industrial incidents
Bhopal was one of the worlds worst human-created disasters. In 1984, thousands of
people died as a result of a leak of deadly methyl-isocyanate gas at the Union Carbide
factory in Bhopal, India. Exact figures are impossible to obtain, as the bodies of many
victims were cremated, and others died later, having left the area. Four years after the
accident, the Indian government estimated that at least one person per day in the areas
surrounding the factory died as a result of injuries or illness caused by the leak, and the
death toll was reported to exceed 3150. Unofficial figures suggest that as many as
500 000 could be injured, disabled or physically or mentally disturbed as a result of the
accident. Diseases of the eyes and gastrointestinal tract were commonplace. Following
lengthy battles, the Indian government and Union Carbide finally agreed on a
$470 million settlement of all civil and criminal proceedings arising from the disaster,
although Union Carbide denied liability. The Indian government originally claimed
$3 billion, far less than would have been claimed if the victims had been Americans. Its
attempts to have the case heard in the American courts failed, Union Carbide claiming
that the leak was caused deliberately by a disgruntled employee. The national and local
governments in India are claiming a total of $67 million in expenses, which means that
the 500 000 Bhopal residents who are finally expected to seek compensation are likely to
receive less than $1000 each.
Source: adapted from Crump (1991) p. 32.
1.2.2 Chernobyl high-profile industrial incidents

Chernobyl is a nuclear power station in the former USSR, which, in 1986, suffered the
worlds worst nuclear disaster. The accident, which occurred as a result of an
experiment involving the switching off of safety systems in one of the four reactors,
caused the deaths of 31 people. At least 129 others suffered acute radiation sickness,
and many thousands are expected to die prematurely as a consequence of exposure to
radiation released from the stricken plant. Costs of the disaster exceeded $350 billion.
Clean-up and reparation costs included encasing the ruptured reactor in steel and
concrete, the evacuation of 116 000 people from the immediate vicinity of the power
station, compensation for the loss of property and crops, and the costs of long-term
medical treatment for those suffering the effects of radiation sickness. Radiation
released into the atmosphere from Chernobyl drifted across much of Europe, and
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restrictions placed on the consumption of meat and vegetables for fear that they might
be contaminated were still in place in 1990 in countries as far away as the UK. Estimates
suggest that a minimum of 2000 people in the European Community are likely to develop
cancers over the next 50 years as a result of this radioactive fallout. The reactor
complex was finally shut down completely in December 2000, following years of
diplomatic pressure from the EU towards the (now Ukrainian) government who argued it
needed the electricity regardless. The structure that initially contained the radiation
the hastily erected sarcophagus is crumbling and urgent repairs are needed, for which
very little money is available.
Source: adapted from Crump (1991) p. 49.
All of the companies involved in these incidents were large corporations, and were
aware of many environmental issues relating to their organisations. In all cases poor
planning, lack of contingency planning, and little awareness of the impact of
catastrophic failures upon the local environment resulted in disasters, which caused
severe damage to the environment and human health.
Can you think of any events/incidents involving business and industry in

your country, which highlight the damage done to the environment?
Identify and provide a summary of an event/incident in your country.
You may also want to include information on:
how you think these events influenced public opinion and attitudes
towards environmental issues
what, if any, response was made by the government of your country
Wikipedia provides a long list of examples of environmental disasters have a look

the website (Wikipedia, n.d.) but just a few examples include:
19501960 Mercury poisoning at Minamata, Japan
1952 London smog kills 4000
1957 Fire at Windscale nuclear reactor, UK, causes radioactive releases
1967 Torrey Canyon oil tanker disaster off the Scilly Isles, UK
1979 Near-meltdown at Three Mile Island nuclear power station, USA
1984 Accident kills over 2000 at Union Carbide plant, Bhopal, India
1984 Liquefied natural gas explosion kills 452 in Mexico City
1986 Chernobyl nuclear power station disaster
1986 Sandoz warehouse fire, Basel, pollutes Rhine
1989 Exxon Valdez tanker accident, Alaska
1990 Shell fined 1 million for oil pollution of river Mersey, UK
1998 Reservoir of toxic mine waste broke and spilled its contents into the
Guadiamar River, Spain
2006 Southeast Asian haze event caused by continued uncontrolled burning

from slash and burn cultivation in Indonesia
2010 BP Deepwater Horizon oil rig explosion and spill, Gulf of Mexico.
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As a result of some of these incidents, inquiries have led to subsequent changes in

procedures, such as the introduction of new legislation, or additional provision for
emergencies. As the 1980s proceeded, increasing public concern over environmental
issues began to manifest itself through the changing habits of consumers. The
phenomenon of green consumerism emerged as a more environmentally aware
public demanded goods and products which minimised environmental damage. In
line with the general increase of public awareness of environmental issues, the rise of
green consumerism also began in the West.
What are your perceptions of green consumerism? Write down at least

six key points.
Political recognition
The growing awareness of environmental issues was reflected politically in the first
United Nations (UN) conference on the Human Environment in Stockholm in 1972,
and the subsequent creation of the United Nations Environment Programme (UNEP).
For many, the Stockholm conference established the legitimacy of environmentalism
as a political movement and provided the first major recognition of the significance of
environmental issues. Prior to September 1988, no serving national leader of global
importance had made a major address on the environment, but 1988/89 brought
statements of concern from Mrs Thatcher (UK), President Bush (USA), President
Gorbachev (USSR), Chancellor Kohl (Germany), President Mitterand (France),
European Commission President Jacques Delors, and many other heads of state.
Environmental issues began to appear in the manifestos of all the major political
parties in the West, as politicians realised that their stance on the environment was a
contributing factor in their success or otherwise in winning votes.
1.3 Sustainable development

The world we have created as a result of our thinking thus far has
problems which cannot be solved by thinking the way that we thought
when we created them.
Source: attributed to Albert Einstein (Wikiquote, n.d.).
The industrialised world has already used up many of the Earths natural
resources, and we are now realising that it will not be possible to carry on in the
same way if we want to protect the future of our planet and those who live on it.
However, it seems that with increasing technological abilities, we are better able to
extract known, or find new, reserves. In addition, reductions in the material intensity
of products the amount of material needed to produce a product has gradually
declined. But, in many cases, the availability of resources should not mean that we
do not have a problem with using that resource. For example, even though we seem
to have enough lead, the health and environmental effects of lead use still make a
strong case against its persistent or increased use. Equally with fossil fuels: if we
compare the carbon emissions that come from using fossil fuels (gas, coal, and oil)
mainly in the combustion engine and power stations and which contribute to the
greenhouse effect and climate change, then we are much more likely to exceed
acceptable levels of atmospheric pollution before we run out of fossil fuels.
Ultimately, all economic development depends on the Earths natural resource base.
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Concern over the rate at which the Earths resources are being used has led to the
development of the concept of sustainable development, a term that you will
probably be familiar with. The most widely used definition of sustainable
development, and one which you should remember, is that given by the World
Commission on Environment and Development (WCED) in its milestone report Our
Common Future (otherwise known as the Brundtland Report) in 1987 (WCED, 1987).
This is much quoted in defining sustainable development, but usually only the first
part is quoted and not the second part, which is a critical qualifier to the first:
Sustainable development is development that meets the needs of the

present without compromising the ability of future generations to meet
their own needs. It contains within it two key concepts:
The concept of needs, in particular the essential needs of the worlds

poor, to which overriding priority should be given; and
The idea of limitations imposed by the state of technology and social

organisation on the environments ability to meet present and future
needs.
Source: WCED (1987) p. 43.
The UN report prepared for the High Level Panel on Global Sustainability at its first
meeting in 19 September 2010 (Drexhage & Murphy, 2010) explains that despite
the definition for sustainable development being widely accepted for 20 years, the
term is still wide and vague. Nevertheless, some common principles are associated
with the concept:
(1) a commitment to equity and fairness
(2) a long-term view that emphasises the precautionary principle
(3) sustainable development embodies integration, and understanding and acting

on the complex interconnections that exist between the environment,
economy, and society.
It is clear that to enable society to develop in a sustainable manner, an approach

other than that which has previously been employed is required. Sustainable
development will present the greatest challenge in the wealthiest nations, which
consume the most resources, release the most pollution, and have the greatest
capacity to make the necessary changes. However, leaders in some developing
countries are suspicious of the concept, as they fear that the industrialised countries
will dictate the development path that the developing countries must take; that is,
the developing countries fear they will be penalised for the previous mistakes of the
developed world.
Sustainable development requires a profound change in the goals and assumptions

that drive corporate activities and changes in daily practices and tools. In other
words, we need to develop an entirely new attitude towards environmental
responsibilities. Business and industry have a vital role to play in determining the
future of the planet and in working towards achieving sustainable development. This
is recognised in the WCED report.
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Many essential human needs can be met only through goods and
services provided by industry ... It has the power to enhance or degrade
the environment; it invariably does both.
Source: WCED (1987) p. 182.
For business, the concept of sustainable development presents a challenge to

produce higher levels of output while using lower levels of input and generating less
waste. Organisations are now faced with the challenge of integrating environmental
considerations into all aspects of their business, and environmental auditing is one
of a number of environmental management tools, which enable them to do this.
The Earth Summit
In 1992, 176 governments sent delegates to the UN Conference on Environment and

Development in Rio known as the Earth Summit. The Rio conference reinforced
the importance of increased emphasis on environmental issues in every sector of the
economy. Agenda 21 (UN, 1992), the global plan of action, which was adopted at
the Earth Summit, contains a chapter on the role of business and industry in securing
sustainable development. Agenda 21 states that businesses should participate in a
wide range of environmental management tasks, of which environmental auditing is
one.
You have seen how worldwide developments in environmental consciousness have

led to major changes in the way in which governments, investors, and the
community at large perceive the importance of the environment. At the level of the
individual organisation, these developments have meant:
tighter legislative controls
constraints on the use of natural resources
increasing pressure from customers and suppliers
greater employee and management interest in the way the organisation

approaches its environmental responsibilities.
These factors have prompted organisations to seek new ways of integrating

environmental considerations into all aspects of their business. In some cases this
has been a requirement of regulatory bodies, while in other cases, a more proactive
approach is taken and organisations voluntarily investigate ways of improving their
environmental performance.
Between 26 August and 4 September 2002 the UN held a follow-up conference to the
1992 Earth Summit. This was the World Summit on Sustainable Development
(WSSD) (UN, 2002) and was held in Johannesburg, South Africa. The conference was
set up to ratify, reinforce, and provide for stronger implementation of the many
international agreements and conventions relating to environment and development.
One of the key outcomes from the Summit included a range of commitments and
targets aimed at achieving more effective implementation of sustainable
development objectives (UN/DESA, 2003).
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The Rio+20 meeting on Sustainable Development (2012) shows the commitment of

governments to sustainable development and to ensuring the promotion of an
economically, socially and environmentally sustainable future for our planet and for
present and future generations (UN, 2014). Among other issues governments also
adopted the 10-year framework of programmes on sustainable consumption and
production patterns. The Conference also took forward-looking decisions on a
number of thematic areas, including energy, food security, oceans, cities (UN, 2014).
The Conference reviewed the Millennium Development Goals achievements but also
agreed on developing the Sustainable Development Goals by 2015.
The Sustainable Development Knowledge Platform of the UN (2014) provides access

to all the updates related to sustainable development actions and programmes
fostered by the United Nations.
1.4 Environmental management

So far this unit has described the growth of environmental awareness by the public,
and the increasing importance awarded to the subject by politicians. Pressure on an
organisation to improve its environmental performance comes from many sources,
both internal and external to the organisation.
There is a wide range of parties potentially that have an interest in a company and
therefore that also have an interest in the effect of a companys practices on the
environment. These are often referred to as stakeholders people or groups of
people who have an interest, a stake, in an organisation. This stakeholder concept
of business contrasts with the more traditional shareholder concept, which aims to
maximise wealth for shareholders (investors in the company). These different models
of business will inevitably result in different business objectives (and business plans
for delivering those objectives) since those objectives will seek to balance the
requirements of different stakeholders (under the former model) rather than just
maximise benefit to shareholders (in the latter). Consequently, there will be multiple
business objectives (the Times 100, 2010), for example:
objectives about market share
objectives about customer satisfaction
objectives about employee satisfaction
objectives about returns to shareholders
objectives about cutting pollution
objectives about reducing waste etc.
Individual businesses have always been faced with a range of competitive market
conditions, which threaten their survival. In many cases, requirements for improved
environmental performance are perceived to add to this threat. Good environmental
management is, however, in many ways simply good management: paying attention
to whether materials or energy are being wasted; considering how by-products can
be re-used; and making sure that operations always run at maximum efficiency. An
increasing number of businesses and corporate organisations are coming to
acknowledge that good environmental sense makes good business sense. If it helps
them increase their market share since it may affect the way in which it is
perceived by its customers and suppliers then that can only be good for business.
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Increasingly, businesses need to show they are serious about environmental issues
and sustainable development in order to be accepted as a legitimate activity by
society, ie be given the so-called social licence to operate.
Pressures for organisations to improve their environmental performance therefore

come from a variety of sources, and have increased over the last few decades. Given
the current status of environmental issues in the minds of both politicians and the
public, it is likely that these pressures will continue to grow. It will be increasingly
difficult for businesses to continue to neglect the inclusion of environmental issues in
their operations. The increasing pressures on organisations to integrate
environmental issues into their operating strategies have led to the development of
new tools which enable them to do this: tools which provide information and facilitate
management control of the environmental aspects of the operation. Environmental
auditing is one such tool.
However, it is important to recognise that improving environmental performance is

not enough in itself. The United Nations Economic and Social Commission for Asia
and the Pacific (UNESCAP) highlights:
While, in general, governments have strengthened legislation and

institutions, resulting in significantly improved environmental
performance, particularly with respect to pollution control, the rising
environmental pressures exerted by expanded consumption and
production and resource-extraction processes threaten to overwhelm the
progress achieved so far. High future environmental, economic and social
infrastructure costs, a growing tendency to generate waste and the
continuing decline of the regions natural capital are the unmistakable
signs of an unsustainable growth pattern.
The continuing focus on improving environmental performance distracts

attention from the critical need to improve the environmental
sustainability of economic growth patterns. Without doubt, economic
growth is a prerequisite for achieving significant reductions in poverty
and addressing key sustainable development issues. However, declining
environmental sustainability represents a critical political, institutional,
social and economic threat for many countries in the region.
Source: UNESCAP (2005) p. 18.
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Section 1 Self Assessment Question
Q uestion 1
List at least FIVE reasons why businesses should improve their environmental
performance.
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2.0 ENVIRONMENTAL AUDITING
Section Overview
To provide an introduction to environmental auditing.

define an environmental audit and understand the key words associated with it
identify the different types of environmental audit and state the reasons why
an organisation would want to undertake an environmental audit.
2.1 What is environmental auditing?

Environmental auditing is essentially an environmental management tool for
measuring the effects of certain activities on the environment against set criteria or
standards. Depending on the types of standards and the focus of the audit, there are
different types of environmental audit. Organisations of all kinds now recognise the
importance of environmental matters and accept that their environmental
performance will be scrutinised by a wide range of interested parties. Environmental
auditing is used to:
investigate
understand
identify.
These are used to help improve existing human activities, with the aim of reducing
the adverse effects of these activities on the environment. An environmental auditor
will study an organisations environmental effects in a systematic and documented
manner and will produce an environmental audit report. There are many reasons for
undertaking an environmental audit, which include issues such as environmental
legislation and pressure from customers.
Definitions
The term audit has its origins in the financial sector. Auditing, in general, is a
methodical examination involving analyses, tests, and confirmations of
procedures and practices whose goal is to verify whether they comply with legal
requirements, internal policies and accepted practices.
The International Chamber of Commerce (ICC) produced a definition in 1989 which is

along the same lines.
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A management tool comprising systematic, documented, periodic and

objective evaluation of how well environmental organisation,
management and equipment are performing with the aim of helping to
safeguard the environment by facilitating management control of
practices and assessing compliance with company policies, which would
include regulatory requirements and standards applicable.
Source: after ICC (1989).
There are other definitions available, although the above definition is still seen as the
industry standard. The key concepts, which occur in all the definitions, are as follows.
Verification: audits evaluate compliance to regulations or other set criteria.
Systematic: audits are carried out in a planned and methodical manner.
Periodic: audits are conducted to an established schedule.
Objective: information gained from the audit is reported free of opinions.
Documented: notes are taken during the audit and the findings recorded.
Management tool: audits can be integrated into the management

system (such as a quality management system or environmental
management system).
Terminology
Environmental auditing should not be confused with environmental impact
assessment (EIA). Both environmental auditing and EIA are environmental
management tools, and both share some terminology, for example, impact, effect,
and significant, but there are some important differences between the two.
Environmental impact assessment is an anticipatory tool, that is, it takes place

before an action is carried out (ex ante). EIA therefore attempts to predict the
impact on the environment of a future action, and to provide this information to
those who make the decision on whether the project should be authorised. EIA is
also a legally mandated tool for many projects in most countries.
Environmental auditing is carried out when a development is already in place, and is

used to check on existing practices, assessing the environmental effects of current
activities (ex post). Environmental auditing therefore provides a snap-shot of
looking at what is happening at that point in time in an organisation.
The International Organization for Standardization (ISO) has produced a series of

standards in the field of environmental auditing. These standards are basically
intended to guide organisations and auditors on the general principles common to
the execution of environmental audits. These are addressed elsewhere in this
module.
Environmental auditing means different things to different people. Environmental

auditing is often used as a generic term covering a variety of management practices
used to evaluate a companys environmental performance. Strictly, it refers to
checking systems and procedures against standards or regulations, but it is often
used to cover the gathering and evaluation of any data with environmental relevance
this should actually be termed an environmental review. The distinction between
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an environmental audit and an environmental review has become blurred, but the
table in 2.1.1 should enable you to understand the differences between the two.
2.1.1 Distinctions between an environmental review and an environmental audit
Review Audit
What is the objective? Determine which performance Verify performance against

standards should be met (eg these standards (eg company
company decides to reduce checks that it really has
total organic compound reduced emission to 10
emissions from 100 tonnes to tonnes/year)
10 tonnes/ year)
Which environmental All known environmental issues Only issues for which
issues are covered? with or without explicit standards exist (eg regulatory
standards to measure requirements, internal
performance company standards, or good
management practice)
How often are they Before developing Regularly and on a pre-

required? environmental management planned cyclical basis
systems or before and after any
significant changes in
operations or practices
What are the Wherever the business could Usually well-defined

geographic have an environmental impact geographic boundaries, (eg
boundaries?
in the life of the product (ie limited to site, distribution
raw material selection, companies or local planning
transportation, manufacturing, authority)
product use and disposal)
Source: Dagg (2005)
Irrespective of the process that is actually being undertaken, some organisations

prefer not to use the term audit. In some cases, therefore, an organisation may call
the procedure of measuring environmental performance against set criteria an
environmental review, an environmental assessment, or another term used
specifically for their own purposes (by now, you should be able to distinguish
between these terms, and be able to determine which is which).
In addition, the term audit, coming from the financial sector, may suggest that
financial audits (whose result typically is the Annual Report) and environmental
audits are very similar. Some areas where they differ are highlighted in the table in
2.1.2, below.
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2.1.2 Distinctions between financial audits and environmental audits
Financial audits Environmental audits
Legal basis of audit Part of regulatory (legal) With few exceptions,

process, organisations have to environmental audits are
perform it voluntary affairs. Even the
preparatory environmental
review which is mandatory
under ISO 14001 is voluntary as
the standard is voluntary
Frequency Annual affairs Whenever the organisation

decides to perform one
Who does it? Performed by external staff, Performed by external and/or

certified to do so internal staff. Professional
indemnity considerations, there
are no legal requirements of
auditors to be competent or
trained, although professional
bodies in many countries try to
stop this
Methodology Financial audits are based on Varies very much between

comparative standards which auditors and companies
are publicly available
General Principles of
Accounting etc
Access to audit The results are public Very few audits are public,
documents in the form of although some results are often
annual reports published in the Environmental
Reports
Liability Auditors are partially liable With few exceptions that are
for their reports. They have negotiated between auditor
to provide a true and fair and auditee, there is no
view of the organisation external liability implication in
environmental audits
Source: Dagg (2005).
2.2 History of environmental auditing

Environmental auditing began in the USA in the early 1970s, when a handful of
industrial companies, working independently and on their own initiatives, developed
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environmental auditing programmes as internal management tools to help review

and evaluate the status of the companys operating units. It enabled managers to
check compliance with:
local environmental laws and regulations
national environmental laws and regulations
corporate policies.
It was also regarded as an activity useful for avoiding prosecution or civil law suits
under the increasing pressures from environmental legislation. The USA Securities
and Exchange Commission (SEC) also played a role in the development of auditing,
as they had reason to believe that certain trading companies had a high exposure to
financial loss as a result of poor environmental performance. The SEC requested that
environmental details should be presented in the end-of-year report and accounts
along with financial information in order truly to represent the financial stability of
those companies, such as US Steel, Occidental Petroleum and Allied Chemicals.
In October 1979, the US Environmental Protection Agency (EPA) issued a draft report
calling for independent, certified third-party auditors who would visit plants, collect
samples, perform analyses, and report results back to government authorities. This
governmental auditing concept received considerable attention (and opposition)
within industry, and never made it beyond the draft report stage.
In the rest of the world, the evolution of environmental auditing was largely due to
the influence of USA subsidiary companies operating abroad. In Europe,
environmental auditing began in the chemical and petrochemical industries, largely
as a reflection of the intrinsic environmental hazards of these businesses, but also as
a result of their involvement with American operations. Environmental auditing only
became widely accepted by industry in the late 1980s as a common management
tool in developed countries, and is increasingly being applied in developing countries
by both foreign and local industry.
As businesses have realised the value of paying attention to environmental

issues, the concept of environmental auditing itself has evolved to address
wider issues than simply legal and regulatory compliance. The widening use of
environmental audits reflects the broadening attitudes of organisations towards
environmental issues in general, and the increasing pressures from investors,
insurers, consumers, and other interested parties. Environmental auditing is
therefore playing an increasingly common role in the management of
organisations worldwide and, in some countries, governments have made (or
are considering making) the practice a legal requirement.
2.3 Introduction to the types of audit

You have seen that the reasons for undertaking an environmental audit are many
and varied. Some audits are carried out for an entire industry or company, while
others are for a specific site. Some audits will endeavour to investigate all aspects
of environmental performance, while others are narrowly defined. An environmental
audit is essentially a process, and the way in which this process is utilised will
depend on what the organisation wishes to achieve from the audit this leads to the
use of different types of audit.
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One of the problems when discussing the various uses of environmental auditing is
that different people use different names to describe the different types. The list
below (after Humphrey & Hadley, 2000) will act as a starting point for the purpose of
this unit.
Corporate audit
Compliance, eg
- Regulatory
- EMS
- Internal standards
Liability, eg
- Pre-acquisition
- Divestment
- Insurance
Single Issue, eg
- Waste minimisation
- Transport etc
Product audit
Lifecycle assessment etc
There are lots of different ways of defining these different types of audits and often
different terms are used for the same sort of audit. Other terms you may come
across include: health and safety audit, minimisation audit (a form of issues audit
above, site audit, due diligence audit (a form of liability audit), activity or operational
audit (eg across company departments or units, such as waste and energy
management).
A compliance (or legislative) audit aims to determine the degree of company

compliance with current or prospective legislation or standards, including, for
example, discharge consents. A liability (or transactional) audit is usually
conducted prior to buying or selling a facility/land in order to identify potential
liabilities, both financial and legal. A minimisation audit generally concentrates on
a single issue, for example, waste or water, and seeks to identify ways to reduce the
amount of waste produced, or water consumed. This may be the same as an issue
audit which concentrates on a topic that has been identified as requiring further
investigation, for example, packaging. Policy compliance audits are primarily
internal management tools, and determine the depth of compliance with company
policy (internal standards in the list above). They should also act as a means of
establishing future strategy. These audits have a similarity with legislative audits, in
that, in both cases, compliance is being determined: in one case it is compliance with
legal requirements, in the other, compliance with company environmental policies.
Environmental management systems audits are internal audits which are part of
any management systems approach. Environmental management systems audits
provide the means by which the effective operation of the system can be checked,
and remedial action taken if necessary.
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Dont worry too much about these multiple terms for the same thing, other than that
auditing can be undertaken for different purposes and therefore will have a different
focus. We will return to this issue at a later stage in the module.
Although the majority of the audits described above would be applicable to a

particular industry or site, it is also possible to carry out audits for an entire industry
and for public authorities, for example, a local authority.
Whatever the objectives, carrying out an environmental audit essentially involves

three main questions for an organisation.
What are our current effects on the environment?
Can we reduce our negative effects on the environment?
How can we make further improvements?
This applies equally to an audit of an entire organisation, a single site, or even an

audit of a particular issue, for example, energy.
2.4 Why would an organisation wish to undertake an

environmental audit?
Some of the reasons why an organisation may wish to undertake an environmental
audit are:
pressures from environmental legislation
environmental liabilities and insurance costs
investment and decisions to buy facilities
detailed investigation of specific issues
corporate image and marketing opportunities
concern about the environmental impact of the organisation generally
past environmental accidents.
Audits enable the management of an organisation to see exactly what is happening

within the organisation and to check the operation (or otherwise) of systems and
procedures. Some environmental auditing programmes have been motivated by the
occurrence of an environmental problem or incident, that is, a reactive response;
others have been established in response to a desire to anticipate and head off
potential problems, that is, the organisation takes a proactive stance. The
incentives for environmental auditing, and the objectives an organisation will have in
undertaking such an audit, have diversified since the early days of environmental
auditing. This diversification reflects the increasing awareness of environmental
issues, which is present in society as a whole, and the realisation by organisations of
the need to integrate these issues into all aspects of their activities.
Environmental auditing can help to reveal the likely weaknesses of an organisations

strategy, therefore reducing the risk of unexpected events. A properly prepared and
conducted environmental audit will bring real benefits to an organisation committed
to act on the results. Some broad groups of the motivations an organisation may
have for carrying out an environmental audit are looked at in the following pages.
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Pressures from environmental legislation

The early response of organisations to environmental issues was largely reactive,
with the majority merely complying with, and not attempting to exceed, the
requirements of regulations. However, as the amount of environmental legislation in
countries worldwide has increased, and controls are likely to continue to be tightened
in the future, companies do not only have to meet existing legislative requirements,
but to look ahead and anticipate future developments. In addition, legislation is
increasingly phrased so that there is the responsibility of organisations continuously
to review and monitor their production processes and technology on environmental
grounds. Environmental auditing can help an organisation to comply not only with
current legislation, but also with proposed requirements
In the UK the Environmental Permitting system simplifies permit applications,

amendments, and variations for both industry and regulator and thereby cuts
unnecessary red tape. It allows regulators to focus resources on medium and high-
risk operations whilst continuing to protect the environment and human health.
Environmental Permitting was first applied to Waste Management Licensing and

Pollution Prevention and Control and will now be extended to further permitting and
compliance regimes. The Environmental Permitting (England and Wales) Regulations
2010 have been approved by Parliament and the National Assembly for Wales and
came into force on 6 April 2010.
Environmental Permitting is one of DEFRAs (UK Department of Environment, Food

and Rural Affairs) Better Regulation initiatives which aim to improve regulatory
activities, cut admin burdens, and focus on the delivery of a better service to
customers.
Carrying out an environmental audit can clarify the exact status of an organisations
operations with respect to environmental legislation and, therefore, allows proactive
companies to anticipate future legislation and prepare their companies for future
requirements.
What advantages may an organisation gain by anticipating

environmental legislation? Write down two or three ideas before reading
on.
Answer.
Organisations who plan ahead and make provision for increasingly stringent
environmental legislation can avoid unexpected costs in the future. Keeping
legislative developments in mind when purchasing new equipment or
planning new processes or products helps to ensure that organisations are
not caught out. Organisations can therefore avoid heavy fines for breaches
of legislation, or being forced to purchase expensive new equipment at short
notice. 2.4.1 provides an example of a company which breached
environmental regulations, and were subsequently caught by enforcement
agencies. If these companies were carrying out regular environmental audits
in order to assess their compliance with environmental legislation, and to
identify any potential problems, it may have been possible to identify the
problems, and implement solutions before the regulatory agency decided to
take action.
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2.4.1 Cement firms pollution fine cut
A cement plant fined 400,000 for allowing dust

to escape from its factory has had its penalty
reduced [in the Court of Appeal].
Cemex, which owns Rugby Cement in Warwickshire,

[England], was fined after nearby residents found
their homes and cars covered in dust in October
2005.
The Court of Appeal has ruled the sum

"disproportionate" and reduced it to 50,000.
The original offence had consisted of not ensuring an external door was closed, leading
to an escape of dust.
The company had been prosecuted by the Environment Agency in October 2006.
Cemex claimed the original fine had been excessive.
After the ruling the Environment Agency said such a large reduction in fine was a
disappointing result.
We will not tolerate poor plant maintenance practices that might lead to incidents
such as this, especially when close to people's homes.
We will continue to thoroughly investigate all such incidents and, where appropriate,
pursue criminal charges, a spokesman said.
Source: BBC News online (Wednesday 18 July 2007)
Environmental liabilities and insurance costs

Organisations naturally look for insurance to protect themselves against potential
liabilities, including environmental liabilities. Organisations pay a premium to insure
themselves against the potential costs of environmental damage arising from their
operations, for example, the costs of remediation from pollution incidents such as oil
spills. Insurers are in the business of assessing risks and, as the potential size and
scope of environmental risks have been recognised by insurers, it has become
increasingly difficult to obtain worthwhile insurance cover at an acceptable cost.
While it is still possible to find insurance cover for pollution, which is sudden,
accidental, and unforeseen, there are very few insurance companies that will provide
comprehensive general pollution cover.
In Europe, Directive 2004/35/EC (The Environmental Liability Directive) seeks to

achieve the prevention and remedying of environmental damage specifically,
damage to habitats and species protected by European Community (EC) law, damage
to species or habitats on a site of special scientific interest for which the site has
been notified, and damage to water resources and land contamination which
presents a threat to human health. It reinforces the polluter pays principle making
operators financially liable for threats of or actual damage.
SOAS CeDEP 25
What type of pollution would insurance companies be reluctant to

cover? Write down your ideas before reading on.
Answer.
Organisations with a dubious environmental record will find it increasingly
difficult and expensive to get insured. Insurance companies are reluctant to
provide insurance cover for pollution that arises from prolonged and
continuous poor management practices or negligence, which leads to
environmental damage.
Gradual pollution may be extremely costly for those responsible, according
to Smets (Smets, 1988). Examples of such pollution are serious water
pollution, air pollution, soil contamination or the release of toxic waste into
the environment. Smets estimates that between 1960 and 1985 there were
at least 65 cases of pollution costing over $18 million.
If an organisation can provide the insurer with as much accurate information
on the environmental risks as possible, the uncertainty is reduced.
Organisations, who already undertake environmental audits as part of a
system of environmental management and are therefore aware of, and in
control of, the environmental effects of their operations, may find it easier to
obtain insurance. It should be noted that the cost difference between an
environmentally aware company and another company is in most cases not
because of the reduced environmental impact of the former, but because of
increased knowledge about the impact, which, as the insurance company
hopes, translates into an efficient environmental management programme.
However, the research evidence suggests that the biggest insurance
premium cuts can be made when insurer and insured discuss an
environmental programme in advance and agree on a set of actions.
Investment decisions to buy facilities

Major companies are becoming aware of the massive potential risks involved in
acquiring land, which has already been contaminated, or acquiring a business that
has a poor environmental performance. Costs associated with ground remediation (ie
rectifying any damage which may have been caused by pollution), and the capital
cost of potential compensation claims for past mistakes can easily outweigh any
financial advantage of an acquisition. Particularly in the USA, but also in most other
countries, it is increasingly standard practice, therefore, for purchasers to
commission a pre-acquisition environmental study or to want to examine the reports
from an organisations environmental audits.
Companies interested in the purchase, sale or lease of facilities must be aware of any
real/potential liabilities associated with the transaction. As the number of company
acquisitions increases, one can expect interest in such audits to grow.
SOAS CeDEP 26
(1)Read the Key Reading by Gensburg et al (2009), which describes

mortality rates following a key man-made disaster which prompted
major liability (so-called Superfund) legislation in the United States.
(These issues are picked up in relation to legislation and companies
elsewhere in this module)
(2)Try to find out if there are any operations run by multinational
corporations in your own country. Does the company operate to the
minimum environmental standards required by your own countrys
legislative system, or do the standards of the parent company or home
country apply?
The outcome of your research will depend on a number of factors, for example, the
size of the organisation and the country within which it operates. If possible, it may
be useful for you to contact a couple of companies that you know are part of a larger
organisation, or obtain copies of any environmental policies or reports they may have
published. This may enable you to find out about their operational standards for
environmental issues.
In many cases, the operations of the organisation are constantly under scrutiny by
regulators, amongst others. This is especially the case with larger companies, who
are often very much in the public eye. This pressure may influence the organisations
environmental policy.
Detailed investigation of specific issues

Environmental audits should naturally identify areas of weakness; in fact, they are
designed and implemented specifically to achieve this objective. An initial review of
an organisation or site may reveal particular issues that require further investigation,
and the organisation may then decide to undertake an audit with the specific
objectives of concentrating on a particular topic, such as waste, energy, water use or
packaging. Changes in processes or products and developments in technology may
alter the manner in which an organisation operates. An issue audit, focusing on the
particular area of concern, can help to ensure that the organisations operations in
this area are as efficient as possible. A single-issue audit is illustrated in 2.4.2.
2.4.2 A single issue audit
A company became aware that it might not have been controlling its air emissions in the
most efficient manner possible. The company had several air pollution sources, each
controlled separately. An environmental audit targeted specifically towards investigating
the air emissions at the site identified the opportunity to combine these sources and
control all emissions simultaneously, thus resulting in real savings as fuel-consuming
control equipment was replaced with cheaper controls at other sources.
Source: unit author
The example of the single-issue audit illustrates that focusing on a particular aspect
of an organisations operations can bring benefits. The majority of issue audits deal
with the evaluation of the impact that particular public issues can have on the
organisation, such as the rise in organic food, the role of dolphin-free tuna as a
SOAS CeDEP 27
public concern for the tuna-fishing industry, the impact the agenda of genetically
modified organisms may have on operations etc. At British Petroleum (BP), a
company dealing in oil, gas, and energy, as well as Unilever, a company providing a
range of branded products, audits have been conducted which are not site-,
organisation- or product-specific. They have introduced the practice of focusing on
how the whole group is dealing with specific environmental issues of key concern.
One such example of this is the loss of tropical rainforest habitat. This audit involves
an evaluation of policy guidelines, operating procedures, and actual practice within
all parts of the business, and at least implies a concern for the global operations of
the industry and its impact on the environment in differing locations.
Corporate image and marketing opportunities

Many organisations have realised that there is real value in presenting a responsible
stance towards the environment. Increasing public awareness of environmental
issues and resulting consumer pressure means that companies which present an
environmentally friendly image may be able to obtain a market advantage. A
competitive advantage can be achieved not merely by keeping abreast of
environmental developments, but also by initiating change within an organisation
and responding with new environmentally friendly products and production
processes. In an economic climate where any favourable publicity is beneficial, a new
competitive element has entered the marketplace. As part of overall environmental
management, environmental audits are an important tool for any companies taking a
proactive stance towards environmental issues.
Environmental concern
Environmental management is often about learning what the environmental
implications are and finding ways in which these can be evaluated, documented, and
subsequently eliminated. Many employees feel uneasy about their polluting
behaviour at work, which may be in stark contrast to the environmental priorities of
the same people outside work. Given that the environment has risen to such a
prominent place in public concern, and has managed to stay there for several
decades, many companies ask themselves whether their way of operating is in line
with the strong environmental concern by the public (and the market). In addition,
there is now quite widespread evidence that reducing emissions and improving
resource and energy efficiency is economically a smart thing to do. Up to a point,
combining environmental concerns with business is profitable and helps the bottom
line. Environmental auditing forms an integral part of this.
Learning from past accidents

Looking at the genesis of environmental concern amongst the environmentally most
enhanced companies often identifies a particular environmental incident that
triggered the step-change towards greater environmental management. For many
German companies this was the killing of the Black Forest due to acid rain and
Chernobyl, for BP the Deepwater Horizon oil spill in the Gulf of Mexico in 2010 will
inevitably result in a profound change in its attitude, even though it had been made
aware by the Exxon Valdez disaster. For Shell it was Brent Spar and Nigeria, for
Union Carbide it was Bhopal. The latter is, by the way, commonly seen to have one
of the most advanced and rigorous environmental auditing programmes in the world.
Also, at a much smaller scale, having been fined for environmental misdemeanours
SOAS CeDEP 28
or facing the prospect of liability is, in many cases, the starting point for a more
preventive environmental programme. That company directors in the UK can be put
into prison for breaches of some parts of environmental law is also an incentive for
managers to consider environmental issues more coherently. However, such events
can only act as wake-up calls if organisations are willing to be woken up or if the
threat is so substantial that palliative measures will not work. In addition, the
immediate threat is normally not triggering an environmental audit, but an
environmental programme as the type of environmental misbehaviour is then quite
obvious, which is often followed up by an audit to verify progress.
You can see, therefore, that there are many reasons why an organisation would
undertake an environmental audit. The reasons vary according to:
the organisations stance on environmental issues
the attitude of the management and/or board of directors
the regulatory regime within which the organisation operates
the pressure from society.
The relative importance of each of the above will depend on the country in which the
organisation operates, as well as the corporate structure. As you can appreciate, this
may be a highly significant factor.
SOAS CeDEP 29
Section 2 Self Assessment Questions
Q uestion 2
List at least FIVE different types of corporate audit.
Q uestion 3
List at least FIVE reasons why a company might wish to undertake an environmental
audit.
SOAS CeDEP 30
3.0 BENEFITS AND COSTS OF ENVIRONMENTAL AUDITING
Section Overview
To outline the benefits and costs of environmental auditing.

identify the benefits an organisation would gain from carrying out an

environmental audit
outline the role of an environmental audit within an organisations
environmental management system (EMS).
3.1 What are the main benefits and costs?

There are a number of benefits to a firm undertaking an environmental audit. Some
of the benefits are obvious, while others are less easy to identify. Two of the more
easily recognised benefits are:
increased management effectiveness
cost savings.
These will be discussed in turn, and then some of the other, less obvious, benefits
will be covered briefly.
Increased management effectiveness

To manage an organisation effectively, management must be aware of every aspect
of the organisations operational procedures and processes. An environmental audit
should reveal any weaknesses in the structures and, when these are rectified, the
management can be confident that nothing has been overlooked and nothing
unexpected is likely to occur. In the words of Dwight D Eisenhower: The uninspected
inevitably deteriorates.
An environmental audit can enable management personnel to become aware of many
environmental issues of which they formerly may have been less well informed. This
is especially the case in organisations with multiple facilities or with large
manufacturing operations, where the senior managers and directors are often located
at a distance, for example, in the head office. Managers may not have visited many
of the sites where there are obvious environmental risks and, even if they have, they
may not have the appropriate knowledge or training to identify that risks are
present. The use of environmental audits can provide management with the
confidence that any actual or potential risks have been identified.
However, auditing by itself does not improve environmental performance. An
environmental audit merely provides a snap-shot of what is happening at that
moment in time, and doesnt help to ensure ongoing management effectiveness and
the proper operation of systems and procedures. As a tool which aids decision-
making and management control, an environmental audit is often carried out as part
of an overall environmental management system.
SOAS CeDEP 31
Cost savings
An environmental audit should identify opportunities for improvements in an
organisations management, and this will often lead to savings in spending. This is
particularly common in the case of issue audits, such as the water or waste audit.
As an example, waste minimisation is an area where there are many opportunities

for an organisation to save money. Waste requires to be disposed of, and this itself
costs money. For instance, companies are charged for disposing of waste into
licensed landfill facilities, or it may be necessary to pay for special treatment of a
chemical before disposal. Reducing the amount of waste produced can therefore
lead to savings, as the organisation has to dispose of a smaller quantity. An obvious
way of minimising the amount of waste generated is to minimise inputs. Adopting a
more efficient process could mean that fewer raw materials are required, and that
the overall cost of raw materials is therefore reduced. Reductions in the amount of
water required can also lead to savings, as organisations are almost always charged
for their water usage.
Recycling not only leads to a reduction in the total amount of waste produced, and
the associated financial benefits of this, but can also lead to direct cost savings. For
example, the by-products of one process may have potential uses in another. In
addition, the recycling of water, which may involve treating/cleaning/cooling can also
lead to a reduction in wastewater disposal costs. It may be useful to explore the
possibility of waste-exchange schemes, that is, selling your waste to other
businesses to use as a raw material, or buying in waste for your own use. The former
can lead to reductions in waste disposal costs, with the latter providing the possibility
of reduced raw material costs.
An issue audit will often highlight the need for an ongoing programme of
improvements. A waste audit can lead to the implementation of a waste reduction
programme, which may feature the major redesign of products, or simply minor
changes to working practices. Organisations, which carry out an environmental audit
in order to establish that they are in compliance with environmental legislation, can
benefit financially in another way. An audit identifies any areas where an
organisation may be in breach of regulations, and if these problems are subsequently
corrected, financial loss through plant closures, clean-ups or restrictions imposed by
government bodies or through bad publicity can be avoided. The opportunity to make
savings is not limited to large companies.
Look at the Construction Sector case study (CS1) (only Section 1.1 at
this stage) to get an initial understanding of the sort of benefits a
company might gain from environmental auditing.
Even small companies who think that environmental issues are of no relevance to
them cannot operate in isolation from environmental issues. Environmental
management is, in many ways, simply good business management, and the
environmental audit makes the management aware of several issues, which would
otherwise not have come to light, and also identifies means of gaining financially. As
well as reduced costs from minimising waste, reducing use of raw materials and so
on, other areas where savings can be made include:
SOAS CeDEP 32
the possibility of reduced insurance premiums for good environmental

performance (refer to environmental liabilities and insurance costs discussion
earlier)
reduced likelihood of unexpected pollution events, therefore less chance of

incurring costly fines.
The benefits of environmental auditing described so far are largely financial, and can
be measured directly. A range of less tangible benefits can also be identified,
including:
increased awareness of environmental policies and responsibilities among the

whole workforce
increased management confidence due to a feeling of security that the

compliance (and safety) status of the plant is confirmed and documented
favourable publicity
improved relationship with regulatory authorities
better understanding of consumer demands.
However, there may also be various perceived disadvantages associated with

undertaking an environmental audit, for instance:
disruption of plant activity while the audit is carried out
the cost of the exercise
the possible perception by staff in the organisation that an audit is a negative

process, which assesses their performance.
Most of these can be minimised or overcome by careful forward planning to ensure

that the audit runs smoothly. Adopting an informal and approachable stance and
pointing out the positive aspects of undertaking an audit can dispel any fears or
misconceptions held by the staff. The cost of the audit can often be recovered by
savings made through improvements identified in the audit and a number of auditing
companies peg their fees to the savings made subsequently, or may operate on a no
gain, small fee basis.
3.2 Role of an environmental audit within an environmental

management system
As you have seen, environmental audits investigate the current environmental
performance of an organisation. Audits therefore provide information on the activities
at that moment in time. Hunt and Johnson (1995), for example, note that,
environmental auditing on its own cannot provide management with the assurance
that environmental practices and performance not only have met, but will also
continue to meet, legislative requirements and sound corporate policy commitments
and expectations.
One role of an environmental audit is to identify areas for improvement, but an audit
does not, in itself, provide the means to implement changes. In order to do this, an
environmental audit should be set in the framework of an environmental
management system.
SOAS CeDEP 33
An environmental management system (EMS) provides a mechanism for

systematically managing the environmental effects of an organisation. EMSs provide
a framework to:
identify significant environmental effects
document regulatory requirements
set objectives and targets for future environmental performance
implement procedures and measures for achieving the objectives and targets
undertake audits to assess environmental performance and the effectiveness of

measures to achieve the defined objectives and targets.
In order to ensure that employees and any other stakeholders understand the
management system, environmental management systems usually rely heavily on
documentation. Environmental effects, environmental regulations, objectives and
targets, and the procedures are usually all documented. It is important to notice that
environmental audit and environmental management systems are not synonymous
terms.
3.3 Evolution of environmental audits

When an organisation first undertakes an environmental audit, the most likely
objective is the identification of problems. As the programme of auditing develops,
subsequent audits tend to increase in sophistication, and the objective is more likely
to be compliance with regulations, and laterally, the effectiveness of environmental
management systems. The evolution of environmental audits (shown in
diagrammatic form in 3.3.1) is therefore to begin by finding problems, and to move
on to confirming the absence of problems as the auditees environmental
performance improves.
3.3.1 Evolution of environmental audits
Source: adapted from ICC (1991)
SOAS CeDEP 34
Section 3 Self Assessment Question
Q uestion 4
True or false?
Not only does an environmental audit identify areas for improvement within an
organisation, such as cost savings, but also provides the means to implement
changes.
SOAS CeDEP 35
UNIT SUMMARY
The relationship between organisations and the environment can be seen as two-
way, with organisations having the potential to affect the environment and vice
versa. Public pressure over environmental issues has also created constraints on
industry and there has been increasing recognition of the importance of the
environment by politicians. Pressure for business and industry to improve its
environmental performance comes from a variety of sources.
Environmental auditing is defined, by the International Chamber of Commerce (ICC),

as a management tool comprising systematic, documented, periodic and objective
evaluation of how well environmental organisation, management and equipment are
performing with the aim of helping to safeguard the environment. Environmental
auditing began in the USA in the 1970s as an internal control tool, which helped
companies to ensure that they were meeting regulatory requirements, and has
developed internationally throughout the 1980s and 1990s. The concept of
environmental auditing has evolved to address issues wider than simple commitment
to legal compliance, for example, identifying improvements and opportunities for cost
savings, and confirming the effectiveness of environmental management systems.
Depending on the objectives of the exercise, there are several different types of
environmental audit. Organisations will have a range of objectives in carrying out an
environmental audit, and these will depend on the size, location, environment, legal
requirements, and management approach of a company.
Environmental auditing can produce a range of benefits for an organisation, including

cost savings and increased management effectiveness and both large and small
organisations can benefit from undertaking an audit. Environmental auditing alone
does not facilitate improvements to environmental performance. Audits simply
identify areas that should be addressed by an overall environmental management
system (EMS).
SOAS CeDEP 36
UNIT SELF ASSESSMENT QUESTION
Q uestion 1
There are three main questions for an organisation that wishes to carry out an
environmental audit. Complete the questions below by filling in the gaps.
(a) What are our current _______ on the environment?
(b) Can we _______ our _______ on the environment?
(c) How can we make further _______?
SOAS CeDEP 37
KEY TERMS AND CONCEPTS

Agenda 21 the global plan of action adopted at the Earth Summit in
Rio in 1992
auditing a methodical examination, involving analyses, tests and

confirmations, of procedures and practices whose goal is to
verify whether they comply with legal requirements,
internal policies and accepted practices
compliance/legislative an audit which determines the degree of company

audit compliance with current or prospective legislation or
standards
direct effects actions from an organisation which cause direct

damage/harm to the environment, for example, oil spillage
may pollute a local river
documented information that is noted and recorded
environmental auditing a management tool comprising systematic, documented,

periodic and objective evaluation of how well environmental
organisation, management and equipment are performing
with the aim of helping to safeguard the environment
environmental awareness the amount of information a person knows about the

environment, that is, how much they are aware of the
environment
environmental a process of improving the environmental performance of

management organisation; good environmental management is in many
ways good management: paying attention to whether
materials or energy are being wasted; considering how by-
products can be re-used; and making sure that operations
always run at maximum efficiency
environmental a mechanism for systematically managing the

management system environmental effects of an organisation
environmental an internal audit used to check the effective operation of

management systems environment management systems
audit
environmental review the gathering and evaluation of data with environmental
relevance
green consumerism the consumption of environmentally friendly products
indirect effects actions from an organisation that cause indirect

damage/harm to the environment, for example, the use of
fossil fuels and the effect this may have on climate change
investigate to examine something
issue audit an audit which concentrates on a topic that has been

identified as requiring further investigation
SOAS CeDEP 38
liability/transactional an audit conducted prior to buying or selling a facility/land

audit in order to identify potential liabilities
macro-scale global level
management tool something that can be integrated into the management

system of a company/organisation, for example, an audit
micro-scale local level
minimization audit an audit which concentrates on a single issue, for example,

waste, and seeks to identify ways to reduce the amount of
waste produced
natural resources the resources (stock that can be drawn on) which occur
naturally in the World, for example fossil fuels such as coal,
gas and oil, biodiversity etc
objective a mission, purpose or standard that can be reasonably

achieved within an expected timeframe and with the
available resources
periodic an established schedule at regular intervals
policy compliance audit an audit which is primarily an internal management tool to

determine the depth of compliance with company policy
pressures forces or activities, both internal and external to an

organisation, which may have an effect on its operation and
the way it operates
stakeholder people or groups of people who have an interest, or stake,

in an organisation
sustainable development a concept developed as a result of concern over the Earths

natural resources and is defined as
development that meets the needs of the present

without compromising the ability of future generations to
meet their own needs. It contains within it two key
concepts:
The concept of needs, in particular, the essential needs of

the worlds poor, to which overriding priority should be
given; and
The idea of limitations imposed by the state of technology

and social organisation on the environments ability to meet
present and future needs. (WCED, 1987: p. 43)
systematic planned and methodical manner
verification the evaluation of compliance to regulations and other set

criteria
SOAS CeDEP 39

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Centre for Development, Environment and Policy

Environmental Auditing and Environmental

Prepared by William Sheate.

Reviewed and updated July 2014 by Dr Rocio A Diaz-Chavez.

ABOUT THIS MODULE

STRUCTURE OF THE MODULE

WHAT YOU WILL LEARN

The specific aims of the module are:

To provide an understanding of how to identify and evaluate the environmental

To provide an understanding of how the environmental impacts of an

To provide a basis for the practical application of environmental auditing and

To provide an awareness of the range of available environmental management

To examine how corporate environmental management may respond to the

Module Learning Outcomes

define environmental auditing and describe the main components of the

Brady, J., Ebbage, A. & Lunn, R. (Eds.) (2011) Environmental Management in

CS1 Construction sector (looking at the environmental impacts

CS2 Electrical and electronic sector (examining for example, major

CS4 Local authorities (eg examples of municipalities using best practice

CS5 Retail sector (examining the performance of key retailers such as

CS6 Sustainable clothing (a specific aspect of manufacturing and retail

Key Terms and Concepts and Acronyms

William Sheate, Ric Eales, Clare Twigger-Ross and Laurence

Video recorded on 8 December 2010 at SOAS. William, Ric and Clare

an examined assignment (EA) worth 20%

a written examination in October worth 80%

(b) The EA is submitted by uploading it to the Virtual Learning Environment.

(e) Plagiarism is a breach of regulations. To ensure compliance with the specific

IEMA INSTITUTE OF ENVIRONMENTAL MANAGEMENT & ASSESSMENT

INDICATIVE STUDY CALENDAR

Part/Unit Title Study time

Unit 1 Introduction to Environmental Auditing and 10

Unit 2 Types of Environmental Audit: the Legal Context 15

PART II Corporate Auditing

Unit 3 Corporate Auditing: Procedures and Methods 20

Unit 4 What to Audit: Environmental Impacts and 15

Unit 5 What to Audit: Emissions and Other Impacts 15

Unit 6 What to Audit: Resource Use and Waste Minimisation 15

PART III Product Auditing

Unit 7 Lifecycle Assessment 10

Unit 8 Sustainable Products and Services 10

Unit 9 Environmental Management System Standards 10

Unit 10 Other Standards and Reporting (CSR, GRI) 15

Examination entry July

Revision and examination preparation September

End-of-module examination October

ACRONYMS AND ABBREVIATIONS

ACCA Association of Chartered and Certified Accountants

AITO Association of Independent Tour Operators

BAT best available technique

BRE Building Research Establishment

BREEAM Buildings Research Establishment (BRE) environmental assessment method

BREFs BAT reference documents

BSH Bosch und Siemens Hausgerte GmbH

BSI British Standards Institute

CACP Clean AirCool Planet

CDP Carbon Disclosure Project

CFV carbon footprint verification

CIRIA Construction Industry Research and Information Association

CO2 carbon dioxide