The new General Environmental Duty – What does this mean for directors?

Victoria’s approach to environmental protection and human health is changing soon.

Coming into effect from 1 July 2021, the General Environmental Duty (GED) will be the cornerstone of the new Environment Protection Amendment Act 2018 (Vic) (EPA Act). The new GED will require all Victorian businesses and individuals to take proactive steps to prevent and minimise harm to the environment and human health.

A breach of the GED by a business may lead to civil and/or criminal penalties, regardless of whether harm has eventuated. In certain circumstances, company officers (directors and managers) of a business can be held personally liable for the acts of their companies.

Individual company officers can be fined up to $660,800, in addition to up to five years’ imprisonment for intentional or reckless breaches. In the case of corporations, a breach of the GED may attract fines of up to $3.3 Million.

What is required by the new GED?

The GED imposes a positive obligation on ‘a person who is engaging in an activity’ to proactively eliminate or otherwise reduce risks of harm to human health or the environment from pollution or waste ‘as reasonably as practicable’.

Some common examples of activities that would need to be managed, include:

• activities that produce noise, odour or runoff to stormwater;
• the storage, use and disposal of liquids and chemicals; and
• management of wastes and the choice of transporter or receiver of wastes.

What is ‘reasonably practicable’ will depend on a number of factors, including the likelihood of the risks of harm, the potential degree of harm, the state of knowledge and the suitable ways and costs of eliminating or reducing risks.

Essentially, the question of whether a business has complied with the GED will be determined by what reasonably practicable steps could have been taken having regard to the particular facts and circumstances of the potential breach.

Company officer responsibilities under the new GED

The GED is modelled on the general duty of protection provided by Victoria’s Occupational Health and Safety Act 2004, which requires company officers to protect health and safety so far as is reasonably practicable.

In a similar way, company officers need to exercise ‘due diligence’ and adopt a proactive approach to ensuring compliance with the EPA Act.

Company officers will need to understand the risks presented by the land they own and control and how those risks can be managed.

Once the risks have been identified, company officers will be required to implement ‘reasonably practicable measures’ to eliminate or reduce the likelihood of those risks occurring. If a company officer fails to have these measures in place, they will be in breach of the EPA Act.

The EPA Act provides a non-exhaustive list of actions that must be undertaken to comply with the GED, including:

• the use and maintenance of plant and equipment in a manner that minimises risks of harm to human health and the environment;
• the use and maintenance of systems for identification, assessment and control of risks of harm to human health and the environment; and
• providing information, instruction, supervision and training to any person engaging in an activity to enable compliance with the GED.

How can businesses prepare?

Businesses can begin preparing for the new GED by:

• actively reviewing the risks and hazards associated with the business activities and the land that it controls;
• carefully reviewing existing internal environmental policies and risk management procedures; and
• training staff on the new requirements to ensure that any existing policies and procedures are revised and tailored appropriately.

The Environment Protection Authority Victoria has also published Guidelines and Compliance Codes, which will provide guidance on how businesses can comply with the new GED, within their relevant sector, including:

• agriculture (publication 1819);
• construction and infrastructure (publication 1820);
• manufacturing (publication 1822);
• mining and quarrying (publication 1823);
• retail (publication 1824); and
• waste and recycling (publication 1825).

If you require specific advice in relation to how your business may be impacted by the new GED, please contact Andrea Towson.

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Authored by:

Andrea Towson, Partner
Eylem Onal, Lawyer