Supply Chain Due Diligence Practical Guide
Environmental Compliance (Abstracted)
1. Strategic Context
Environmental compliance has shifted from an optional "bonus" to a mandatory market entry requirement. Global regulations like EU CSRD, EUDR, and CBAM are redefining expectations for supply chain environmental performance.
2. The 4-Pillar Environmental Audit Framework
To manage environmental risks effectively, the guide categorizes requirements into four actionable domains:
Pillar A: Environmental Management Systems (EMS)
- Core Standard: ISO 14001 (PDCA cycle: Plan-Do-Check-Act).
- Key Requirement: Companies must identify their Environmental Aspects (activities) and their Environmental Impacts (results).
- Compliance Marker: Legal "Three Simultaneous" (Design, Construction, Operation) policy for environmental facilities.
Pillar B: Pollution Prevention & Control
- Air/Water: Monitoring Chemical Oxygen Demand (COD) and emissions.
- Waste: Strict separation of Hazardous Waste (HW) with legal transfer manifests.
- Chemicals: Adherence to REACH (registration) and RoHS (restricted substances).
Pillar C: Resource Efficiency & Climate
- GHG Accounting: Tracking emissions across Scopes 1, 2, and 3.
- Energy/Water: Implementation of reduction targets and monitoring in high-stress areas.
Pillar D: Biodiversity & Land Use
- Deforestation: Compliance with EUDR, ensuring products like rubber and wood are not linked to post-2020 deforestation.
- Ethics: Respecting FPIC (Free, Prior and Informed Consent) for indigenous lands.
3. High-Risk Red Flags for Auditors
- Unpermitted discharge pipes (bypass).
- Inaccurate GHG data or "Greenwashing" claims.
- Missing Hazardous Waste manifests or improper storage.
- Sourcing from protected biodiversity zones without documentation.
4. Key Data Resources
- IPE Blue Map: Essential for checking environmental violation records of Chinese factories.
- RMI/CMRT: For mineral-related environmental and social tracing.
- Protected Planet: Global database for verification of protected area boundaries.
Derived from the Supply Chain Due Diligence Practical Guide Series (2025 Edition).