The Environmental Due Diligence (EDD) is an investigative technique designed to identify and quantify liabilities associated with environmental issues and to assess the risks that are present at a site, thereby supporting potential buyers. It serves as a crucial investigative practice for merger and acquisition operations. Through Due Diligence investigations, risks and costs related to both current and past activities can be identified, including considerations for health and safety risks in line with Environmental Health and Safety Risk Assessment principles.
The Environmental Due Diligence is carried out on decommissioned industrial sites as well as commercial and residential real estate assets. This process involves studying the area and its historical context, identifying environmental liabilities linked to air, soil, subsurface, or water contamination, evaluating legal obligations, identifying non-compliances with subsequent management of corrective and preventive measures, and assessing risks while quantifying the economic implications of any identified non-compliances and/or liabilities.
Through the EDD, it is possible to quantify the environmental liabilities an investor may face, allowing for the planning of any necessary remediation efforts and associated investments or for requesting the necessary adjustments prior to acquisition.