An important part of land management is having an accurate idea as to the environmental risks that are present, and ensuring that your business is complying with environmental legislation. It’s important that you’ve taken steps to minimize the possibility of soil, groundwater or other contamination. If you don’t do this, and an environmental accident occurs, you could be found liable and prosecuted.

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Environmental Due Diligence (EDD)

EDD is a compliance process that allows you to demonstrate you have taken all necessary steps to reduce the possibility of contamination caused by activities for which you are responsible. It involves a technical survey of your site and a legal assessment of your position. Environmental risks are often the result of previous activities on the site, so the survey goes beyond your current business and its operations.

The process will identify risks and then quantify them, in terms of the possible financial loss, third party liability, reputational damage or prosecution, should the risk materialize. Then comes the most crucial part of the exercise - putting in place effective and robust mitigation that provides the best protection possible.

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Defra publishes detailed guidance on how the risk assessment should be carried out. Where the due diligence identifies significant risks, Land Remediation Services will be necessary from firms such as The amount and type of remediation depend upon the contaminants that are present, the location, and the way the land is used. For example, land that is covered by a goods yard or car park may have a different requirement from land that is in an environmentally sensitive area.

What happens during an environmental due diligence audit?

The history of the site is researched and current activities are assessed for risk. Soil and groundwater samples are taken for analysis. Your legal compliance is audited and what is known as Phase I and Phase II Environmental Site Assessments are carried out.

The result of the process can often affect a potential purchaser’s decision as to whether to proceed with the purchase. Similarly, the ability to prove due diligence and effective land remediation can enhance the capital value of a site and reduce the amount of insurance that needs to be provided. For these reasons, many businesses and individuals use the process periodically as part of a best practice approach to land management.

Published by Sunil Pandey