An Environmental Policy Statement is a formal document in which an organisation sets out its commitment to protecting the environment, managing the environmental impact of its operations, and complying with applicable environmental law. In England and Wales, the legal framework governing environmental obligations for businesses is extensive and rapidly evolving, and an Environmental Policy Statement serves as the foundational document through which an organisation demonstrates its awareness of and commitment to that framework.

The primary legislation governing environmental obligations for businesses in England and Wales includes the Environmental Protection Act 1990, which establishes the duty of care for waste management, pollution control, and statutory nuisance; the Environment Act 2021, which introduced biodiversity net gain obligations, new air quality targets, water quality provisions, extended producer responsibility for packaging and waste, and a strengthened framework for environmental governance; the Climate Change Act 2008, which establishes the UK's legally binding commitment to achieve net zero greenhouse gas emissions by 2050 and creates the carbon budgeting system; the Waste (England and Wales) Regulations 2011, which implement the waste hierarchy of prevention, reuse, recycling, recovery, and disposal; and the Environmental Permitting (England and Wales) Regulations 2016, which establish the environmental permit regime for regulated activities.

For larger organisations, additional obligations arise from the Energy Savings Opportunity Scheme (ESOS) Regulations 2014, which require large undertakings (250 or more employees, or meeting the relevant turnover and balance sheet thresholds) to conduct mandatory four-yearly energy audits; and from the Streamlined Energy and Carbon Reporting (SECR) framework under the Companies Act 2006, which requires quoted companies and large unquoted companies to report their energy use, greenhouse gas emissions, and energy efficiency measures in their Annual Report.

An Environmental Policy Statement is also the cornerstone of ISO 14001:2015 certification, the internationally recognised standard for Environmental Management Systems. ISO 14001 requires organisations to establish, implement, maintain, and continually improve an environmental management system, and a formal Environmental Policy is explicitly required by clause 5.2 of the standard. ISO 14001 certification is increasingly required by procurement clients in both the public and private sectors, making a well-drafted Environmental Policy Statement a commercial as well as a legal necessity.

An Environmental Policy Statement is needed by businesses in England and Wales in a wide range of circumstances, driven by legal requirements, commercial pressures, and the growing expectations of investors, clients, and other stakeholders.

You need an Environmental Policy Statement if your organisation is subject to the Streamlined Energy and Carbon Reporting (SECR) requirements under the Companies Act 2006. SECR applies to quoted companies (those listed on the main market of the London Stock Exchange or on certain overseas exchanges) and to large unquoted companies and large LLPs that meet at least two of the following criteria: turnover of at least £36 million, balance sheet total of at least £18 million, and at least 250 employees. These organisations must include quantitative energy and emissions data and a description of energy efficiency measures in their Directors' Report, and an Environmental Policy Statement provides the strategic framework within which those measures are designed and implemented.

You need an Environmental Policy Statement if your business holds, or intends to apply for, an environmental permit under the Environmental Permitting (England and Wales) Regulations 2016. Environmental permits are required for a wide range of industrial and waste management activities, and the Environment Agency assesses permit applicants' environmental management arrangements as part of the permitting process. A documented Environmental Policy Statement is evidence that the organisation has a systematic approach to environmental management.

You need an Environmental Policy Statement if your business is pursuing or maintaining ISO 14001:2015 certification. The standard explicitly requires a documented Environmental Policy as a prerequisite for certification, and the policy must be appropriate to the organisation's context, include a commitment to pollution prevention, legal compliance, and continual improvement, and be communicated to all persons working under the organisation's control.

You need an Environmental Policy Statement if your business is subject to the Energy Savings Opportunity Scheme (ESOS) mandatory energy audit requirement. ESOS applies to large UK undertakings and requires a four-yearly energy audit of buildings, transport, and industrial operations. An Environmental Policy Statement that includes energy efficiency commitments demonstrates that the organisation is acting on ESOS audit recommendations.

You need an Environmental Policy Statement if your business carries out development activities or manages land that may be subject to the biodiversity net gain requirements introduced by the Environment Act 2021. These requirements, which came into force in November 2023 for major developments, require a measurable 10% net gain in biodiversity as a condition of planning permission.

Even where there is no specific legal trigger, an Environmental Policy Statement is increasingly expected by institutional investors under Environmental, Social and Governance (ESG) criteria; by supply chain customers who incorporate environmental requirements into their procurement processes; and by lenders and insurers who assess environmental risk as part of their underwriting criteria.

A well-drafted Environmental Policy Statement for a business in England and Wales should address several essential components that reflect both the legal framework and accepted best practice in environmental management.

The policy statement itself is the starting point: a clear, senior-level commitment to protecting the environment, minimising the organisation's environmental impact, complying with applicable environmental legislation, and achieving continual improvement in environmental performance. Under section 172 of the Companies Act 2006, company directors have a statutory duty to have regard to the impact of the company's operations on the community and the environment. A signed Environmental Policy Statement is evidence that the directors have discharged this aspect of their duty.

The scope clause defines the extent of the policy, identifying the sites, operations, employees, contractors, and supply chain activities to which it applies. A clearly defined scope is essential for ISO 14001 certification and for demonstrating to regulators and stakeholders that the policy is comprehensive rather than aspirational.

The legal compliance section should reference the specific legislation applicable to the organisation's operations, including the Environmental Protection Act 1990 (duty of care for waste), the Environmental Permitting (England and Wales) Regulations 2016 (permit conditions), the Environment Act 2021 (biodiversity net gain, extended producer responsibility), the Climate Change Act 2008 (net zero trajectory), and the ESOS and SECR frameworks where applicable. A commitment to maintaining a legal register of applicable environmental legislation is a best practice element that demonstrates systematic compliance management.

The environmental objectives and targets section is the heart of the policy. It should set out specific, measurable targets for each environmental commitment: a carbon reduction target aligned with the UK's net zero trajectory; a waste reduction and recycling target referenced to the waste hierarchy under the Waste (England and Wales) Regulations 2011; water consumption targets; and biodiversity objectives aligned with the Environment Act 2021. Targets should be time-bound and should identify the baseline against which progress will be measured.

The monitoring and reporting section should describe how environmental performance will be measured against targets, how data will be collected and verified, how performance will be reported internally to the Board of Directors and externally under SECR or other reporting frameworks, and how the organisation will respond when targets are not met.

The incident reporting procedure is a legally important element. The Environmental Protection Act 1990, the Environmental Permitting (England and Wales) Regulations 2016, and the Water Resources Act 1991 each impose obligations to report certain environmental incidents to the Environment Agency and other regulatory authorities. The policy should establish a clear internal incident reporting procedure and identify who is responsible for making regulatory notifications.

The responsibilities section allocates environmental accountability across the organisation: the Board of Directors sets strategy and approves the policy; senior management allocates resources; the Environmental Manager implements the policy and manages performance; line managers ensure operational compliance; and all employees have a duty to comply with the policy and report concerns. Clear allocation of responsibility is essential for ISO 14001 certification and for demonstrating a systematic approach to environmental management to regulators, investors, and clients.