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COMPLIANCE SECTION
ASTM Standard Provides
Guidance for Compliance Auditing
BACKGROUND
ASTM recently published its standard for compliance auditing, E-2107-00 Standard Practice for Environmental Regulatory Compliance. Previously, ASTM had no standard relating to compliance auditing. The ASTM E-1527 Standard relating to Phase I Environmental Site Assessments specifically excludes compliance issues. The E-1527 standard was created to provide for a legally defensible “innocent landowner” protection and to standardize the process that was used for “all appropriate inquiry” consistent with “good commercial or customary practice” under CERCLA. Similarly, the E-2107-00 Environmental Regulatory Compliance standard represents ASTM’s effort to standardize and identify the minimum requirements for regulatory compliance auditing.
OVERVIEW
E-2107-00 provides an overview of the benefits, risks, and legal issues related to regulatory compliance auditing. These issues are discussed in the background section of the document (Section 1.2). This material is available on the ASTM web site at http://208.233.211.80/cgi-bin/SoftCart.exe/DATABASE.CART/PAGES/E2107.htm?L+mystore+pmzf6279. Key benefits to compliance auditing identified in the Background Section include a better understanding of the compliance status of the facility and reduction or elimination of potential legal and financial liabilities.
While risks exist in the compliance auditing process, they can be dealt with through careful planning. Some of the potential risks include inadvertent statements contrary to the interest of the company because of audit wording, potential legal and financial liability if the company does not attempt to correct the deficiencies identified by the audit, protection of trade secrets, and proper handling and management of privileged audit information. Legal issues relating to auditing can be minimized if environmental legal counsel is introduced to the audit process early.
Some key considerations summarized in the E-2107-00 standard include:
- Reliance by all parties on an audit report;
- Flexibility concerning the criteria addressed and level of review for the audit;
- Establishing a clearly defined period of time for the audit;
- Validity of the audit only for the period under review;
- Use of prior audits only if they have continued viability;
- Use of an auditor that is qualified, competent, objective and independent;
- Use of an audit process that consists of pre-visit, site-visit and post-visit activities; and
- Preparation of a report summarizing the audit findings.
The E-2107-00 standard is separate from the E-1527 standard for Phase I Environmental Site Assessments. The two standards are not interchangeable. In addition, the E-2107-00 standard procedures are not the same as those identified in ISO 14000.
SUMMARY
The E-2107-00 standard provides guidance to assist in the development of audit programs. Because sensitive information may be gathered, we suggest that any audit be conducted under the guidance of legal counsel. The Payne Firm can assist you and your counsel in developing a strategic audit plan. For more information, please contact Tony Domanico or
Emily Rynders at (513) 489-2255 or by e-mail at aid@paynefirm.com or ear@payenfirm.com. You may visit us at our web site at www.paynefirm.com.
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