Environment protection principle 2: assess and manage environmental risks and impacts
This Good
Practice Note is for DFAT staff, delivery partners and environment specialists involved in delivering
Australia’s aid program. It is one of a series of notes which explains the principles of the aid program’s
Environment
Protection Policy and how they should be addressed. The notes complement the
Operational
Procedures of the
Environment
Protection Policy.
This Good
Practice Note should be read in conjunction with the Department of the
Environment publication:
Actions on, or impacting upon,
Commonwealth, land and actions by Commonwealth agencies
Significant impact guidelines 1.2.
The environmental risks of all aid program activity must be assessed under:
1. Partner country laws
2. The Environment Protection and Biodiversity Conservation Act 1999
(EPBC Act)
3. Multilateral environment treaties.
To help ensure compliance with DFAT’s legal obligations, aid initiatives and activities should be screened, and where appropriate assessed for environmental risk.
The EPBC Act applies to aid activities regardless of their value or whether they will be implemented by DFAT or through a partnership arrangement.
DFAT’s responsibility for complying with the Act cannot be devolved to delivery partners or contractors.
While it is DFAT’s responsibility to ensure compliance with the Act, delivery partners are required to meet DFAT contract and agreement conditions relating to assessment, management and reporting of environmental risks.
Where environmental screening obligations are met.
indicates a medium to high likelihood of a significant impact on the environment, an environment assessment and
Environment Management Plan should be completed as part of the design process in consultation with the Environment Safeguards Section.
If your investment is being implemented by a partner organisation, such as a development bank, you should still ensure that an environment assessment is completed in cooperation with the partner which ensures that DFATs

Screening
Environment protection principle 2: assess and manage environmental risks and impacts
Low risk No further action except normal risk monitoring and due diligence
Medium or high risk
Must assess environmental risks and plan to avoid, manage and monitor medium to high risks
If significant risk is still likely
Must get help regarding referral and possible further assessment
This assessment should answer the question: is a significant impact on the environment likely to result from the activity?
Assessments of the likelihood of an activity having a significant impact on the environment should follow the significant impact guidelines of the Department of the
Environment for the self-assessment of risks under the EPBC Act.
You should keep a clear record of your assessment, demonstrating that that you have considered each relevant step of the self-assessment process:
1. The environmental context
2. Potential impacts
3. Impact avoidance and mitigation
4. Are the impacts significant?
Consider all impacts that could be reasonably predicted to result from the activity, whether they are within the control of DFAT or its partners or not. Indirect impacts will be relevant where they are sufficiently close to the proposed action to be said to be a consequence of the action. (E.g. potential impacts of future irrigation activities may need to be considered even if DFAT is only funding the construction of a dam.)
A discussion of what impacts on the environment you should consider is included under Potential impacts in the significant impact guidelines.
In considering whether a significant impact on the environment is likely as defined by the EPBC Act your assessment can take account of:

Proven, reasonable, feasible measures to avoid and manage the impacts that have been identified can be considered
How to assess environmental risks | 2

Environment protection principle 2: assess and manage environmental risks and impacts

The capacity and capability of delivery partners, local contractors/agents to effectively implement these measures in a manner that will reduce the likelihood of a significant environmental impact occurring should be taken in to account.
Note though that beneficial impacts of an activity cannot be offset against negative impacts in this assessment. The assessment. should clearly indicate whether or not any significant impact on the environment can be avoided or mitigated.
In the first instance, impacts should be avoided. If t hey can’t be avoided, measures should be developed to reduce the risk of a significant impact. Common approaches include:

Site selection – to avoid sensitive, high-value sites and vulnerable communities

Timing – to avoid monsoons, large migrations

Design – to reduce or avoid damage, and to repair and restore environmental assets and values

Offsets – mitigation through offsets cannot be used in determining that a significant impact is not likely.
Examples of activities that could lead to significant impacts include those that:

Result in environmental impacts in the case of natural disasters and extreme weather

Damage, reduce or fragment populations or habitat of listed threatened or migratory species

Damage, reduce or fragment a Ramsar listed wetland, a World Heritage listed site or a national park/protected area
• Measurably reduce the quality of air, water, sea or soil according to World Bank
Environmental Health and Safety Guidelines and World Health Organization Air
Quality Guidelines

Promote the use of harmful substances that are listed under multilateral agreements or are banned or being phased out internationally, or pesticides that in the local context are unlikely to be managed under international Integrated Pest Management standards

Import or transport harmful substances listed in the Basel Convention and Waigani
Convention
 Significantly reduce women or men’s access to resources and socio-economic development opportunities

Significantly disadvantage women, people with disabilities or other vulnerable groups

Cause dislocation or relocation of individuals or communities.
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Environment protection principle 2: assess and manage environmental risks and impacts
The assessment process should also consider compliance with local environmental laws
 refer to resources such as the Asian Development Bank country environment analyses and guidance provided by partner governments.
The content of the assessment report should be guided by the significant impact guidelines and include:
1. Summary of findings and recommendations
2. Requirements of Australian and national laws
3. Description of the components and features of the environment
4. Description of the components and stages of the activity
5. An analysis of the risks and threatening processes
6. An analysis of the impacts
7. An assessment of the severity of the impacts and whether they can be avoided or managed
8. A recommendation regarding the significance of the impacts.
An annotated outline of a best practice environment assessment and environment management plan for development activities, including consultation processes and mitigation and management measures to be taken during project implementation is available at: www.adb.org/documents/safeguard-policy-statement .
If a significant impact may still be likely after risks have been considered and reasonable measures for avoiding and managing the risks have been taken into account, you should seek help from the Environmental Safeguards Section to decide if the activity should be referred for advice to the Minister for the Environment under the EPBC Act. There is a statutory process for making a referral.
Depending on the advice of the Minister, an activity that is referred may require a more detailed assessment that meets the statutory requirements of the EPBC Act.
If a significant impact is no longer likely because the risks have been assessed and any significant risks can be reasonably avoided or mitigated with a high degree of confidence, you should still prepare a plan for managing, monitoring and reporting on the risks, based on the risk assessment.

Contact the Environment Safeguards Section: environment@dfat.gov.au
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How to assess environmental risks | 4