In brief - An EMS can help your business avoid polluting the environment
The benefits of implementing an EMS include lower business costs through reduced resource consumption and waste production, lower risk of polluting the environment, better relations with environmental regulators and a positive environmental image in the eyes of customers and the general public.
Businesses may need an EMS under a regulatory regime or as a certification requirement
An EMS can be used by all organisations of any type or size to develop and implement a policy committed to the prevention of pollution and compliance with legal and non-legal requirements. In Australia, the EMS tool is based on the Australian and New Zealand standard for environmental management AS/NZS ISO14001. Case studies indicate that businesses that implement an EMS gain many benefits.
Participation in an EMS is voluntary, unless it forms part of a regulatory regime or is in response to an AS/NZS ISO 14001 certification requirement. Clause 4 of AS/NZS ISO14001 contains the requirement to be audited in order for an organisation to achieve certification of its environmental management system.
EMS accreditation required for major projects in NSW
In accordance with the NSW Government Code of Practice for Procurement (Code), tenderers and service providers of major projects (that is, greater than $10 million) are required to have an EMS accredited by a government agency.
Within the building and construction industry, the NSW Government Environmental Management System Guidelines Edition 3 (Guidelines) and AS/NZS ISO 14001:2004 provide a framework for an EMS in accordance with the Code. Similar regulations and guidelines apply to major projects in the other Australian states.
Certification of EMS by authorised assessor
In addition to Code requirements, a common reason for seeking certification is that it allows independent verification and provides assurance to internal and external stakeholders of the integrity of an organisation's management system.
Companies seeking certification of their EMS need to complete a legal register as part of an EMS. The legal register refers to legislative requirements that are directly relevant to the organisation and its operations. Accordingly, not all environmental state and federal legislation must be included in the legal register.
NSW Government Construction Agencies may only accept an EMS if they are provided with:
• Evidence that the EMS was accredited in accordance with the Guidelines; and
• An audit report provided by an authorised assessor, attesting that the EMS complies with AS/NZS 14001 and all relevant environmental and other legislation.
The Guidelines also provide that the contractor must provide a statement confirming that they are not in default of any fine issued for a breach of environmental laws, along with details of all environmental prosecutions imposed upon the contractor. An EMS accredited in accordance with the Guidelines and Code will be deemed to be acceptable for three years after the date of accreditation.
An EMS can lower business costs and improve profitability
Despite the stringent Guidelines, an EMS brings with it many benefits. For example, it may improve business profitability by lowering business costs through reduced resource consumption and waste production. The production of waste can be expensive, requiring the use of costly end-of-pipe systems or disposal fees.
The generation of waste may be a sign of an inefficient production process, requiring greater use of raw materials than actually needed. By recognising these costs, an organisation can develop ways to reduce waste, such as re-using waste internally or even selling parts of that waste for other processes and uses.
PR benefits of sound environmental management
In addition to financial benefits, an EMS has the potential to improve an organisation's relations with environmental regulators and the broader community. Promoting a positive environmental image to customers has the potential to increase the demand for products and services.
Civil and criminal penalties for environmental pollution
Whilst legislation for the protection of the environment varies across the states, all Australian organisations have a common general environmental duty to protect the environment. For example, Chapter 5 of the Protection of the Environment Operations Act 1997 (NSW) imposes a general duty to avoid pollution of the environment. In light of their legal obligations, organisations can use an EMS to ensure that their environmental performance is compliant.
There is a multitude of legislation that not only provides for heavy civil penalties, but also imposes criminal penalties for pollution of the environment. It is important for all organisations to exercise their due diligence in identifying and assessing the specific environmental risks of their activities, whilst benefiting from the implementation of an EMS.
Compliance with relevant environmental legislation is the minimum standard that every organisation should achieve.
This is commentary published by Colin Biggers & Paisley for general information purposes only. This should not be relied on as specific advice. You should seek your own legal and other advice for any question, or for any specific situation or proposal, before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories. © Colin Biggers & Paisley, Australia 2023.