environmental audit

1. ENVIRONMENTAL AUDIT AN EMERGING ISSUE��.

3. INTRODUCTION : Organizational response to the environment and the role of the accounting profession for the environmental protection are fairly recent developments. Environmental issues are business issues and have considerable implications for 'audit' in all its semblance leading to a separate specialized area viz., 'environmental auditing'. It is seen as an essential element in any organization's environmental response. In view of their core competencies in the field of auditing, chartered accountants can play a significant role in the 'environmental protection' - which is one of the essential objectives of the environmental auditing. .

4. Definition & Meaning The Confederation of British Industry has defined environmental auditing as �the systematic examination of the interactions between any business operation and its surroundings.� This includes all emissions to air, land and water; legal constraints; the effects on the neighboring community, landscape and ecology; the public�s perception of the operating company in the local area - Environmental audit does not stop all compliance with legislation. Nor is it a �green-washing� public relations exercise�. Rather it is a total strategic approach to the organization's activities.

5. Industry and environment relationship

6. Definition & Meaning Article 2(f) of the European Union Eco Management And Audit Scheme defines EA as �A management tool comprising a systematic, documented, periodic and objective evaluation of how well environmental organization, management and equipment are performing in the aim of helping to safeguard the environment by : Facilitating management and control of environmental practices, Assessing compliance with company policies, which would include meeting regulatory requirements�.

7. Why Environmental Audit Business can assess the environmental impact of their operations Corporate decisions are spoiling company�s market for its products, destroying the source of essential supply, damaging or polluting the very infrastructure that makes usage and demand of the product grow EA can highlight areas of inefficiencies in process e.g. where the amount of resources used are out of proportion to the amount of saleable items/services produced. It can highlight excessive wastes Can provide opportunity for business to decrease its wastes output and reduce the cost of waste treatment or waste disposal

8. EIA goals Environmental Impact Assessment is a tool designed to identify and predict the impact of a project on the bio-geophysical environment and on man's health and well-being, to interpret and communicate information about the impact, to analyze site and process alternatives and provide solutions to sift out, or abate/mitigate the negative consequences on man and the environment. The EIA is a means of avoiding environmental disturbances that are always much more expensive to correct after their occurrence than before. It is also important to underline that very few projects have been deemed not viable merely because of the cost of pollution control and that modern environmental control, in a new plant, is less than 3% of the initial investment. The environmental issues must be addressed as soon as possible during project planning. There should not be any hesitation in abandoning a project or a process at an early stage, or in proposing alternatives to any project which would have very detrimental impact on the environment. In the same way as economic, financial, institutional, or technical analyses, EIA is an integral part of the project.

9. EA GOALS �EA should provide answers to the following questions raised by company managers : What are we doing? In particular, are we in compliance with government regulations, guidelines, codes of practice, permits conditions ? Can we do it better? In particular, are there non regulated areas where operations can be improved to minimize the impact on the environment? Can we do it more cheaply ? What more should we do ?� It is also important to note that an EA cannot stand alone and must be integrated in an overall management system and must include dialogue between the plant manager and people living in the vicinity.

11. Steps for EA Audit The International Chamber of Commerce presents the different steps of an EA as follows: Pre-audit activities: which include: Selection and scheduling of facility to audit, Selection of audit team, Contact with facility and planning of the audit. 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 facility. 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.

12. Scope of EA 1. Material Audit : The thrust areas of material audit is the effective utilization of materials, conservation of materials and minimizing wastages in different processes. 2. Energy Audit : It deals with overall energy consumption, minimizing pollution etc. 3. Water Audit : Evaluation of raw water intake facilities and evaluation of water treatment facilities. 4. Health and Safety Audit : Health and safety measures are examined e.g. occupational diseases, compliance with labour laws, adequacy of safety measures etc. 5. Environmental Quality Audit : It examines noise level, status of existing air quality, review of greening program undertaken by the enterprise, Installation and functioning of anti pollutant equipment. 6. Water Disposal Audit : Review of waste disposal measures relating to solid and hazardous wastes, recycling etc. 7. Engineering Audit : It analyses the aspect relating to efficiency of plant and machinery, engineering designs, cost effective methods of production etc.

13. Benefits Facilitating comparison and interchange of information between operation or plants, Increasing employee awareness of environmental policies and responsibilities, Identifying cost-savings including those resulting from waste minimization, Evaluating training programmes and providing data to assist in training personnel, Providing an information base for use in emergency response arrangements, Assuring an adequate, up-to-date environmental database for internal management awareness and decision making in relation to plant modifications, new plans, etc., Helping to assist relations with authorities by convincing them that complete and effective audits are being undertaken, by informing them of the type of procedure adopted.

14. What is EMS EMS Stands for Environmental Management System. It is a system that enables any organisation irrespective of its size, type & setting to Manage environmental impacts arising out of its activities, product & services Ensures compliance to regulations Brings continual improvements Demonstrate high environmental performance to others by conforming to policy, objectives & targets.

15. Why EMS? The reasons why many companies are now adopting an Environmental Management System includes the following: Improve compliance with legislative and regulatory requirements; Facilitate access to overseas markets; Reduce liability/risk; Helps in attracting a high-quality work force; Prevent pollution and reduce waste; Generate a desire to profit in the market for "green" products; Improve the internal management methods Create community goodwill

16. What Is ISO 14001 ISO 14001 is an Environment Management System (EMS) standard published by International Organization for Standardisation in year 1996 and later updated in the year 2005. It provides a highly effective, globally accepted framework for establishing and continually improving the effectiveness of environmental management. Implementation of ISO 14000 may bring with it both reductions in environmental risk and environmental costs.

17. How does the ISO 14001 Certification process work? Pre-assessment Visit: Following documentation review, a pre-assessment visit is performed visit provides the Lead Auditor with a brief overview of the clients Environmental Management System. For ISO 14001:2004 certification, the assessment consists of two stage assessment. Both the assessments are conducted at site. Stage I: In the first stage, in addition to the system document assessment the following issues are assessed: 1. Identification of Environmental Aspects 2. Environmental regulations and laws are observed 3. Internal Environmental Audit and Management Review Stage II: On recommendation of the assessment team, the assessment moves to the state II of the audit. All Non - conformities raised at stage I should be closed before going for Stage II Audit. The aspects assessed in State II are: 1 Operation2 Implementation3 Effectiveness of the Environmental Management System in the Organisation.

18. Corrective action requests: The applicant will be required to take corrective action within the committed time for any non-conformances found before certification can be granted. Certification: STQC Certification Services will issue a certificate of registration to the applicant once the corrective action has been accepted and/or implemented. The certificate carries a validity of three years from the date of issue. Surveillance: During the certificate validity period, surveillance assessments are carried out at an interval of 12 months (max) in the first and second year of the certificate validity. Renewal: The client's quality system is re-assessment for the renewal of certificate. The re-assessment is carried out before at the end of the validity period of certificate. How does the ISO 14001 Certification process work?

19. Environmental Audit : Indian Status In India there is no Statutory requirement for EA in Corporate sector or in the Government sector. Few private sector companies like TISCO,ITC are periodically conducting EA. In India a procedure for EA was first notified under the Environment Protection Act in 1986 by the Ministry of Environment of Forests. This notification requires submission of an � Environmental Audit Report� or statement to the concerned state Pollution Board. As per the Indian Companies Act, 1956, details relating to energy consumption/energy conservation are presented in the Director�s Report as annexure and it highlights the environment related policies/problems.

20. How green is the Material Girl?

21. As London gears up for Saturday's Live Earth concert at Wembley to tackle climate change, we examine the carbon footprint of headline act Madonna... But how green are the Material Girl's own credentials? In the run-up to Live Earth, an environmental consultant has calculated Madonna's carbon output to be over 1,000 tons a year. Although the environmental audit was offered to Madonna for free, her management decided not to co-operate. Instead messages were posted on her fan site and 'Madonna experts' were asked to draw up a full itinerary for the singer since May 2006. Environmental consultant John Buckley's assessment of Madonna : The lion's share of the performer's carbon output was generated during the Confessions Tour, one of the biggest pop tours ever staged. Madonna clocked up 56 concerts across the world. At least 100 people, including crew, dancers and support staff, travelled with her. Based on these calculations it's estimated that the tour generated over 651 tons of carbon. "Madonna produces the same amount of carbon as 102 average Britons," said Mr. Buckley. "Even though she runs a global business she's also set herself up as some sort of ambassador for the environment. "Therefore she needs to be seen to be walking the walk as well as singing the song."

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