Environmental Audit - Board of Engineers Malaysia

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Environmental Audit –
A Proactive Tool For Pollution
And Accident Prevention
By Ir. Dr. Chong Hock Guan, CEO and Principal Consultant, GMP Environmental Consultants
With many environmental
accidents happening these
days, we should be more
proactive to find ways to prevent
accidents. One of the ways is the
effective use of environmental audits
to regularly check an organisation’s
environmental management and
practices.
Most engineers know the word
“Environmental Audit”, but not many
know its importance and benefits.
Some have a misconception that
environmental audit is a fault-finding
exercise and a waste of time. Coupled
with inexperienced auditors with poor
understanding and application of
audit methodology, many
environmental audits are conducted
in a sub-standard manner, merely to
satisfy the needs of certification or
contractual requirements.
Concepts Of Environmental Audit
Contrary to what most people
believe, environmental audit is
actually fact-finding work. A proper
and systematic environmental audit
will definitely yield benefits, and
some of these benefits include:
● Highlight positive efforts made in
environmental performance
● Identify potential environmental
accidents
● Initiate corrective and preventive
action to avoid accidents and
disasters
● Ensure compliance with
environmental legislation
● Improve efficiency
● Reduce wastage and improve cost
savings
● Enhance corporate image of the
organisation
● Increase confidence of customers
in the processes and products
● Educate and motivate the
workforce
● Demonstrate management
commitment to environmental
control
● Improve the working environment
– making the place safer and
healthier
● Encourage “self-regulation”- thus
reduce the burden of enforcement
So, what is “environmental audit’?
Environmental audit can be
defined as “a measure of
environmental risks, and an
assessment of environmental
opportunities”. The popular
management concept – “What gets
measured, gets done” – is well applied
here. This means, audit should have
measurement involved, and audit
tools, which can measure
quantitatively, will be able to measure
the environmental performance
effectively.
Legal Requirements
The Environmental Quality Act
(EQA) 1974 of Malaysia specifies
requirements on environmental audit;
as contained in Section 33A
Environmental Audit noted below:
(1) The Director General may require
the owner or occupier of any vehicle,
ship or premises, irrespective of
whether the vehicle, ship or premises
are prescribed under Section 18 or
otherwise, to carry out environmental
audit and to submit an audit report
in the manner as may be prescribed
by the Minister by regulations made
under this Act.
(2) For the purpose of carrying out
an environmental audit and to submit
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a report thereof, the owner or occupier
so directed shall appoint qualified
personnel who are registered under
subsection (3).
(3) For the purpose of this section,
the Director General shall maintain a
list of qualified personnel who may
carry out any environmental audit
and submit a report thereof.
In addition, Section 51 of the EQA
1974 further states:
(1) In addition to and not in
derogation of any of the powers
contained in any other provision of
this Act, the Minister after
consultation with the Council may
make regulations for or with respect
to - (t) regulating environmental audit
and the submission of an audit report
and the appointment of qualified
personnel to assist the Director
General in carrying out an
environmental audit of any vehicle,
ship or premises, irrespective of
whether the vehicle, ship or premises
are prescribed under section 18 or
otherwise, and their manner of
operation, and prescribing the fees
chargeable
Environmental audit in the EQA
1974 is defined as “a periodic,
systematic, documented and objective
evaluation’ to determine –
(a) the compliance status to
environmental regulatory
requirements
(b) the environmental management
systems, and
(c) the overall environmental risk of
the premises.
It can be interpreted that the Act
requires three types of the
environmental audit to be done
notably:

● Compliance Audit
● Environmental
Management Systems
Audit
● Risk Audit
As noted below, these are
three of the many other
types of environmental
audit.
Types Of
Environmental Audit
The main types of
environmental audit can
be categorised as:
1. Compliance Audit –
mainly to check on
compliance with the legal
or corporate requirements
2. Environmental
Management Systems
Audit – The International
Standard, ISO 14001
Environmental
Management Systems-
Specification with
guidance for use specifies
clearly such a
requirement. This audit
checks the whole
management system with
regards to the
requirements of ISO
14001 Standard. Figure
1 shows the ISO 14001 EMS model.
3. Risk Audit – This type of audit
evaluates the level of environmental
risks with regards to the operation and
activities in such organisation.
4. Due Diligence Audit – This is
used by organisations or banks to
evaluate environmental conditions
when dealing with merging,
acquisition or divestment of
properties.
5. Environmental Impairment
Liability Audit – an essential prerequisite
for organisations to obtain
insurance to cover the liability
resulting from environmental
pollution and impact.
6. Environmental Marketing Audit
– such an audit is used by
organisations to check that their
products are in conformance with
consumer and legislative
requirements.
7. Energy Audit – Since energy
production involves natural resources,
this type of audit covers the collection,
analysis and interpretation of energy
audit. The results are cost savings and
efficient use of energy.
8. Certification Audit – This
involves assessment against an agreed
standard prior to issuance of certificate.
9. Environmental Performance
Audit – checks on environmental
performance, including continual
improvement in reducing
environmental pollution.
10. Audit on Contractors and
Suppliers – examines the
environmental activities of its
contractors and suppliers, in particular,
in reference to their compliance to
environmental legislation and
standards.
11. Product Audit – This usually
checks the product life-cycle, from
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conception to final disposal, to ensure
all processes and raw materials used
are in-line with environmental
requirements.
12. Cleaner Production Audit – Also
called Waste Minimization Audit. This
audit finds the processes involved in
reducing and eliminating the use of
toxic chemicals, which aims to result
in less pollution and toxic wastes
produced.
As there are many types of
environmental audit, every
organisation has to be clear on and
specific which type of environmental
audit it needs.
Systematic Environmental
Audit Methodology
A systematic environmental audit
consists of three main stages:
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1. Pre-Audit
Pre-audit deals with preparations
prior to the audit on-site. The work
include:
● communicating with the site
personnel on the audit
● obtaining background information
about the site
● defining the scope and intent of
the audit
● determining the type of audit
● selecting audit team members
● preparing the necessary equipment
– audit checklists, personal
protective equipment and other
audit tools
● making preparations on logistic,
accommodation and
transportation if needed, and
● sending a letter of notification to
the site to confirm the audit onsite
2. On-Site Audit
This is the main bulk of the
audit, and is done in the ‘auditee’.
Auditee is defined as the
organisation being audited. This
Verification
Interviews
GMP ENVIRONMENTAL
CONSULTANTS
phase comprises five events in
sequence, they are:
(i) Opening meeting – This is the
first formal event at the site, and
should be attended by audit team
and the management of the auditee.
Usually the top management will
address the audience first, and the
audit team leader will then inform
the management on the agenda and
the methodology of the audit.
(ii) Familiarization tour – The audit
team members are accompanied by
key personnel of the auditee to visit
the site briefly in order to be familiar
with the nature of operations and
the environmental concerns. It
should be noted that this is not site
inspection. This event is not needed
if the audit team members are
familiar with the site.
(iii) Interviewing the knowledgeable
persons – This is the essence of the
on-site audit, whereby key
personnel are interviewed to obtain
Interviewing
Knowledgeable Persons
Facts
Verification of Responses
Document
Review
Audit
Findings
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facts in response to the audit
questions. Figure 2 shows the
importance sequence of events for
this on-site audit technique.
(iv) Verification – The facts obtained
from the knowledgeable persons are
verified. There are three techniques
of verification:
● Document review – this exercise
examines the manual, procedures,
work instructions, records and
supporting documents
● Verification interviews –
involves interviewing employees
randomly to check the
implementation of systems in
place.
● Site Inspection – all physical
installations at the site are
checked against the standards
and good environmental
practices.
A combination of any three
verification techniques can be used,
with the main intent of confirming
evidence of the facts obtained.
Site
Inspection

(v) Closing Meeting – Audit findings
and conclusions are presented by the
audit team leader to highlight
“Noteworthy Efforts” (conformities)
and “Areas for Improvement” (nonconformities).
Recommendations
should be provided by the audit team,
though they are not binding.
3. Post –Audit
This is mainly report writing and
follow up after the submission of
report. The report is confidential, and
should be factual with key findings
from the audit, notably with sections
on Noteworthy Efforts and Areas for
Improvement. Recommendations for
improvement should be included,
unless specifically requested to be
excluded by the client.
A good audit report should
contain the following sections:
● Cover Letter
● Executive Summary and
Score Sheet
● Working Copy
● Findings from Site Inspection
● Summary of Verification
Interviews
● Conclusion and Suggestions for
Action
Depending on the contractual
requirements, usually two copies of
the reports are submitted to the client,
with a copy extended to the auditee.
The client may pose questions after
reading the audit report, and the audit
team leader must be prepared to meet
the client and the auditee’s
representatives to make presentations
of the findings and to answer specific
questions.
Audit Tool
A good audit tool consists of
checklists that are accurate and
reliable so that competent auditors
using the tool and working
independently would reach similar
audit findings from evaluating the
same audit evidence. A good audit
tool should preferably have a
qualitative or quantitative
measurement of the audit results. GMP
ISO 14001 Audit Scheme® is one such
tool which has been widely used in
industries for measuring quantitatively
the audit results of environmental
management systems (EMS).
Figure 3 shows that using the
GMP ISO 14001 Audit Scheme®, the
overall audit results can be
measured quantitatively against the
EMS Standard from a scale of 0-
100%. Figure 4 shows the detail
results for each component of ISO
14001 in achieving the overall
results in Figure 3.
Responsibilities Of Auditors
Environmental auditors, whether
internal or external auditors, are
professionals. As such, proper codes
of ethic or principles should be
followed.
ISO 19011: 2002 Guidelines for
Quality or Environmental
Management Systems Auditing states
clearly the principles for auditing as
noted below:
● Ethical conduct: The foundation
of professionalism. Trust, integrity,
confidentiality and discretion are
essential to auditing.
● Fair presentation: the obligation
to report truthfully and accurately.
Audit findings and conclusions
should be accurate substantiated
with facts and evidence.
● Due professional care: the
application of diligence and
judgment in auditing.
● Independence: auditors should be
unbiased and free from conflict of
interests.
Figure 3 - Audit Score using GMP ISO 14001 Audit Scheme ®
100%
22.7%
Baseline EMS Audit Result for AAA Sdn Bhd
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EMS Standard
Areas for
Improvement
Noteworthy
Efforts
● Evidence-based approach: the
rationale method for reaching
reliable audit conclusions in a
systematic audit process.
Audit team members should be
competent with the following criteria
(based on ISO 19011:2002 for EMS
Auditors):
(a) Entry qualification – the
minimum entry qualification is
secondary education, though a
university/college qualification is
preferred.
(b) Qualified in specific knowledge
and skills – these can be achieved
via university education or
external training. For an
environmental management
systems auditor, the training
syllabus should include:
● Audit principles and
methodology
● Management systems - ISO
14001 EMS Standard
● Environmental engineering
and technology
● Organisation’s operation and
general business process
● Environmental law
At least 40 hours of training is
needed for the above courses.
(c) Environmental related work
experience – at least two out of
a total of five years for those with
5-7 July 2004
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Figure 4 - Graph on Details of Audit Score
PERFECT SCORE
4.1
ISO 14001 CLAUSE
4.2
4.3.1
4.3.2
4.3.3
4.3.4
4.4.1
4.4.2
4.4.3
4.4.4
4.4.5
4.4.6
4.4.7
4.5.1
4.5.2
4.5.3
4.5.4
4.6
AVERAGE
GMP ISO 14001 AUDIT SCHEME
GMP ISO 14001 AUDIT SCHEME - GRAPHICAL PRESENTATION
Audited Site : AAA Sdn Bhd Date : 5-7 July 2004
BASELINE EMS ISO 14001 AUDI T
0.0%
0.0%`
0.0%
0.0%
0.0%
0.0%
14.3%
16.7%
20.0%
25.0%
20.0%
22.7%
33.3%
33.3%
33.3%
37.5%
42.9%
50.0%
0 10 20 30 40 50 60 70 80 90 100
SCORE PERCENTAGE
Infancy Developing Maturing Advanced Desired
secondary education, and at least
two out of a total of four years
for those with university/college
qualification.
(d) On-the job training and
experience – minimum four
complete audits for a total of at
least of 20 days.
In Malaysia, the Society of
Environmental Auditors Malaysia
(SEAM) was set up in 1998 to gather
the environmental auditors in
Malaysia and to provide them with
information networks regarding the
development of environmental audit
and environmental management.
Conclusion And The Way Forward
While there are many benefits
and need for environmental audit,
challenges still exists which must be
resolved. Some factors that can be
considered to ensure success of
environmental audit in Malaysia
are:
● Enforce the use of environmental
audit through Environmental
Audit Regulations by the
Department of Environment.
Enforcement imposed by the
Government will increase the
practice of environmental audit.
● Increase awareness on the
importance and benefits of
environmental audit, through
talks, training, campaigns,
promotions and bulletins.
● Recognise and promote
environmental auditors as
important professionals in the
development of the nation.
● Provide incentives to
organisations practicing good
environmental audits – this can be
done through awards and tax
incentives.
● Train more environmental
auditors to encourage the proper
application of environmental
audit.
There are tremendous
opportunities for environmental audit
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GMP Environmental Consultants
100%
to grow in Malaysia. Both the public
and private sectors have respective
roles to play to ensure the success of
environmental audit in Malaysia.
REFERENCES
1. Chong H.G., December 1999,
Environmental Audit from the
Perspective of A Consultant, Bengkel
Audit Alam Sekitar, Department of
Environment, Malaysia.
2. Chong H.G., March 2004,
Environmental Audit Training
Manual (Edition 9), GMP
Environmental Consultants,
Malaysia.
3. International Organization for
Standardization, 1996, ISO 14001:
Environmental Management Systems
– Specification with Guidance for
Use, Switzerland.
4. International Organization for
Standardization, 2002, ISO 1901:
Guidelines for quality and/or
environmental management systems
auditing, Switzerland. BEM