India notifies Environment Audit Rules, 2025 to bolster environmental compliance & governance

The Government of India, through the Union Ministry of Environment, Forest and Climate Change (MoEFCC), has officially notified the Environment Audit Rules, 2025, which came into force on August 29, 2025.

These rules represent a significant step towards enhancing environmental protection, promoting self-compliance, and strengthening climate action commitments across the nation.

Background and rationale for the rules

The new rules, developed under the Environment (Protection) Act, 1986, follow an extensive public consultation process. The draft was first issued on January 29, 2024, inviting feedback from citizens, experts and stakeholders.

After reviewing the suggestions, the ministry finalised the framework to promote self-regulation, strengthen internal environmental controls within industries, and enhance compliance with the country’s environmental laws and standards.

At the core of the Environment Audit Rules is the principle of environmental self-compliance, backed by independent verification. The rules mandate systematic environmental audits for projects, activities and processes that have a bearing on the environment. These audits will ensure that such activities comply with legal safeguards under various laws, including the Environment Protection Act, Air Act (1981), Water Act (1974), the Forest Conservation Act, and the Wildlife Protection Act.

The audits are expected to support India’s overarching environmental goals and commitments under the Lifestyle for Environment (LiFE) mission, while also aiding pollution prevention and environmental rejuvenation.

Importantly, the proposed environment audit system is not intended to replace the existing compliance and monitoring mechanisms carried out by government agencies. Instead, it is designed to supplement these efforts, while the regulatory authorities will continue to perform their established roles of inspection and verification as needed.

Registered auditors to lead process

The notification introduces several key institutional players. One of them is the Registered Environment Auditor (REA) — an individual or a firm authorised to conduct environment audits. These auditors must first obtain certification from a government-appointed body known as the Environment Audit Designated Agency (EADA).

EADA will be responsible for managing the entire audit ecosystem: Certifying auditors, registering qualified professionals and firms, monitoring their performance, and facilitating training and capacity building.

Broad scope of work for environmental auditors

The scope of work for REAs under the Environment Audit Rules, 2025 is broad and integral to the country’s evolving environmental compliance framework.

REAs will be responsible for conducting environmental audits of projects, activities and processes governed by applicable environmental laws. Their work will involve collecting and analysing samples of emissions, effluents and solid or hazardous wastes, as well as evaluating the effectiveness of installed pollution control and waste management systems.

Auditors are expected to identify and report any violations or instances of non-compliance with environmental regulations. In cases where required by a competent authority, they will also compute environmental compensation for such non-compliance.

In addition to report preparation and submission in accordance with existing regulations and government-issued guidelines, REAs will verify self-compliance reports submitted by project proponents. They may also be assigned verification tasks under several frameworks, including the Green Credit Rules, 2023, Ecomark Rules, 2024 and various waste management rules such as those for e-waste, plastic waste and battery waste.

Furthermore, REAs can be tasked with audits under the Environmental Impact Assessment (EIA) Notification, 2006 and the Coastal Regulation Zone (CRZ) Notifications of 2011 and 2019. Their responsibilities also include conducting site visits, collecting samples, obtaining audit evidence and accessing relevant documents to support the audit process.

This is a progressive step towards improving environmental governance in India. Independent audits are expected to raise accountability, encourage better compliance among industries and fill gaps in regulatory oversight.

Conflict of interest & ethical safeguards

To protect the integrity of the audit process, the rules lay down strict conflict of interest provisions. Auditors are barred from auditing any project where they or their firm have personal, financial or professional links,including prior consultancy roles, family relationships or financial interests. They are also prohibited from accepting gifts, commissions or inducements.

Auditors must submit an undertaking of impartiality before accepting any assignment. Projects will be assigned through a randomized selection process, ensuring fairness and transparency. A Code of Conduct will also be enforced, covering professional ethics, data confidentiality, and integrity. Any misconduct, including falsification of data or unauthorised disclosures, may result in penalties, including suspension, debarment, or legal action. However, due process must be followed before any disciplinary action is taken.

Oversight & governance mechanisms

A high-level Steering Committee, chaired by the Additional Secretary of MoEF&CC, will oversee the implementation of the audit scheme. The committee will include officials from various divisions of the Ministry, the Central Pollution Control Board (CPCB) and regional offices. It will be responsible for monitoring progress, recommending amendments and coordinating efforts at the central and state levels.

In case of any discrepancy between an audit report submitted by an REA and the findings of a government officer, the government officer’s report will take precedence. The reason for preferring the official report must be recorded in writing. The central government will have the final authority in resolving such disputes and issuing necessary directions for implementation.

Way forward

“The real challenge is not in conducting quality environmental audits, but in ensuring that the data they generate is put to meaningful use. For that, public accessibility is key,” said Nivit Kumar Yadav, programme director, industrial pollution, Centre for Science and Environment, New Delhi

Environmental audits have been conducted in various forms for over three decades, but their findings are rarely available in the public domain, he added. “As a result, valuable information often ends up sitting unused in reports, limiting its role in decision-making, enforcement and public engagement.”

What’s needed now, the expert noted, is not just better audits, but a clear system to make this information accessible to all stakeholders. “Industries should be required to publicly disclose key environmental indicators, such as coal and freshwater consumption, or measures adopted to reduce these. Without such transparency, third-party audits risk becoming just another compliance formality.”

Institutionalising the public disclosure of environmental audit data is essential for strengthening accountability and advancing climate action. Making this information accessible will encourage public participation, support regulators and encourage industries to improve their environmental performance, Yadav said.