Environmental auditingAn Environmental audit is a general term that can reflect various types of evaluations intended to identify environmental compliance and management system implementation gaps, along with related corrective actions. In this way, they perform an analogous (similar) function to financial audits.
There are generally two different types of environmental audits: compliance audits and management systems audits. Compliance audits tend to be the primary type in the US or within US-based multinationals.
During the past 20 years, advances in technology have had major impacts on auditing. Laptop computers, portable printers, CD/DVDs, the internet, email and wireless internet access have all been used to improve audits, increase/improve auditor access to regulatory information and create audit reports on-site.

Contents of Environmental Auditing

Conducting a proper environmental audit requires many useful activities/steps to be followed by the auditing committee. These activities are divided into the following 3 phases.
  1. Pre-audit activities: which include:
  • Selection and scheduling of facility to audit.
  • Selection of audit team.
  • Contact with facility and planning of the audit.
  1. Site activities: which are divided into 5 steps:
  • First understanding of internal controls.
  • Assessment of internal controls.
  • Gathering of audit evidence.
  • Evaluation of audit findings.
  • Report of findings to the facility.
  1. Post audit activities: which include:
  • Production of a draft report.
  • Production of a final report.
  • Preparation and implementation of an action plan.
  • Monitoring of action plan.

Types of Environmental Audit

There are three main types of audits which are:

  • Environmental compliance audit

These audits are intended to review the site’s/company’s legal compliance status in an operational context. Compliance means conforming to a rule, such as a specification, policy, standard or law.

There are always a set of environmental policies and laws that an organization or the project in hand should follow or “Comply” with. Compliance audits are done to assess whether the project satisfies the guidelines of the policies. If not, then why aren’t they complying and what should be done about it?
The compliance audit is also known as “Quality audit” generally begins with determining the applicable compliance requirements against which the operations will be assessed. It can be further classified into 2 types:
  1. Multimedia audits: involve identifying and auditing all environmental media (air, water, waste, etc.) that apply to the operation/company.
  2. Programmatic audits: are limited in scope to pre-identified regulatory areas, such as air.
  • Environmental management audit

This audit is done to verify whether an organization meets its stated objectives.

  • Functional environmental audits

This audit is done for monitoring quality, wholesomeness, utility, exploitation and various other aspects of such as for water, air, and electricity.

Benefits of Environmental Auditing

Benefits vary depending on the objectives and scope of the audit. The primary benefits of Environmental auditing include:
  • Organisations understand how to meet their legal requirements
  • Meeting specific statutory reporting requirements
  • Organisations can demonstrate they are environmentally responsible
  • Organisations can demonstrate their environmental policy is implemented
  • Understanding environmental interactions of products, services & activities
  • Knowing their environmental risks are managed appropriately
  • Understanding how to develop and implement an ISO 14001 EMS
  • Improving environmental performance and saving money.

Environmental Auditing in India

Environmental audit

Environmental auditing is fast emerging as a key practice among industries in India to monitor, assess and mitigate and risk elements of the project at hand and improve their environmental responsibility and performance. It has been regarded as an effective tool to assess how material, energy, water use, environmental quality and worker health an safety audits can help in saving costs in the production process.

The concept of environmental auditing in industrial units in India was formally introduced in March 1992 with the overall objective minimizing consumption of resources and promoting the use of clean technologies in industrial production to minimize generation of wastes.

The Supreme Audit Institution (SAI) in India is headed by the Comptroller and Auditor General (CAG) of India who is a constitutional authority. The CAG of India derives his mandate from Articles 148 to 151 of the Indian Constitution. The CAG’s (Duties, Powers, and Conditions of Service) Act, 1971 prescribes functions, duties, and powers of the CAG.

While fulfilling his constitutional obligations, the CAG examines various aspects of government expenditure and revenues. The audit conducted by CAG is broadly classified into Financial, Compliance and Performance Audit. An environmental audit by SAI India is conducted within the broad framework of compliance and performance audit.