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What is environmental audit? Why do you need it?

In today's business world, environmental responsibility has become a crucial aspect of corporate success. An environmental audit offers companies a powerful tool to assess their impact on the environment, ensure compliance with regulations and align with their sustainability commitments. This comprehensive evaluation helps businesses identify areas for improvement, reduce energy consumption, and align their practices with environmental laws. 

Understanding an environmental audit 

An environmental audit is a systematic assessment of an organization's operations, procedures, and facilities to evaluate their compliance with environmental regulations, industry standards and own practices.  

The audit aims to identify potential environmental risks, evaluate the organization's environmental performance, and recommend improvements to minimise negative impacts. In general, environmental audits can cover areas such as air and water quality, waste management, energy consumption, and overall environmental sustainability practices. The environmental management system is often a key assessment part in the audit. 

In manufacturing sectors, it is fundamental also to evaluate environmental impacts coming from the use of chemicals and wastewater, as an unwanted output from the production process.  

Organizations often conduct environmental audits annually to systematically benchmark their performance against standards and identify gaps to proactively rectify problems before they turn big.  

Popular environmental audit standards 

Instead of setting up own environmental standards which will take a great effort, companies can leverage well-developed and recognised environmental audit schemes: 

  • amfori BEPI: comprising of eight Performance Areas for assessment, the scheme is one of the most widely adopted schemes in the world and is applicable to different industries 
  • SMETA 4-Pillar: SMETA by Sedex is another audit standard adopted worldwide. The 4-Pillar version of SMETA allows a detailed environmental assessment, on top of other social and ethical due diligence reviews, offering a comprehensive view to the businesses. 
  • Higg FEM: the scheme targets textiles and apparel industry and goes into many details on industry-specific assessment criteria such as wastewater, sludge and groundwater. 

Benefits of running environmental audits 

Environmental audits provide numerous benefits that extend beyond mere regulatory compliance. They enable organizations to optimise resource usage, cut costs, and enhance their reputation. By conducting these assessments, companies can uncover opportunities for operational improvements, minimise waste, and develop sustainable strategies. 

Financial benefits of environmental audits 

Environmental audits play a crucial role in driving cost savings for businesses through the identification of inefficiencies in resource usage and waste management. By implementing audit recommendations, companies can optimize energy consumption, raw material usage, and waste generationreduction, recycling and resources management, leading to reduced costs.  

Additionally, by addressing non-compliance issues early on, audits help prevent costly legal problems and reputational damage. Regular environmental audits promote improved environmental performance, instilling a culture of responsibility within organizations. This commitment to environmental stewardship not only enhances brand reputation but also demonstrates social responsibility to stakeholders. 

Operational improvements through environmental audits 

The environmental audit process involves a thorough examination of operational practices and processes, uncovering opportunities for adopting sustainable practices and alternative technologies that enhance efficiency and cost-effectiveness. 

Businesses can gain valuable data and insights that can inform strategic planning and decision-making. They enable organisations to set measurable environmental goals, track progress, and continuously improve their sustainability initiatives.  

Foster strong impactful brand image and reputation 

From customer’s perspective, they look for services and products that are made ethically and responsibly. By demonstrating low environmental impact, businesses can establish positive brand images that could enhance customer engagement and loyalty. It helps also nurturing better stakeholder engagement, especially with local communities where the businesses operate 

Internally, businesses with healthy brand reputation tend to connect better with their employees and drive better retention.  

Demonstrate sustainability commitment and drive growth 

Stakeholders expect data-backed commitments when communications are being made, especially for environmental claims to avoid greenwashing. By running environmental audits, companies obtain objective data and views towards their performance, allowing them to make fact-based communications to customers, governments, NGOs and the public.  

By embracing environmental audits, companies can pave the way for a more sustainable and profitable future, while contributing to the well-being of our planet. 

Reach out to us if you are interested in those popular industry standards for discussion anytime. 

 

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