Bridging the Legal Gaps in Environmental Auditing

Environmental auditing urgently requires further improvements to its legal framework. Photo: TL

Auditing Promotes Accountability

As demands for sustainable development and more effective environmental governance continue to grow, the role of supreme audit institutions (SAIs) is becoming increasingly prominent. According to the International Organization of Supreme Audit Institutions (INTOSAI), environmental auditing is not only a tool for assessing compliance with environmental laws but also helps improve the effectiveness and efficiency of state management and ensure the economical and efficient use of public resources for environmental protection.

In Vietnam, following the recognition of the SAV's role in environmental protection under the 2020 Law on Environmental Protection, environmental auditing has made significant progress in terms of scope, content, and quality. According to Dao Trong Khanh, Deputy Chief Auditor of SAV Region VIII, and the research team, through its audits, the SAV has gradually affirmed its role in protecting and optimizing the value of public assets associated with natural resources and the environment.

Through audits of land, water resources, minerals, forests, and biodiversity, the SAV has assessed the management, exploitation, and use of natural resources, contributing to the rational use of national resources and sustainable development. Audits have also focused on the management and use of environmental protection funds, investment in waste treatment infrastructure, climate change response, and environmental protection programs, thereby helping improve the efficiency of state budget utilization.

During the 2015–2025 period, the SAV conducted more than 55 audits involving environmental issues, including over 25 thematic environmental audits and more than 30 audits incorporating environmental components. Based on its findings, the SAV recommended improvements to more than 200 legal documents, mechanisms, and policies, contributing to more effective state environmental management and strengthening the accountability of relevant agencies and organizations.

The implementation of thematic audits and the integration of environmental issues into a wide range of other audits have expanded the scope of assessments and provided additional grounds for audit conclusions and recommendations. Through these activities, the SAV has identified shortcomings in management mechanisms, highlighted potential sources of pollution, and recommended improvements to environmental protection policies and legislation.

Audit results are reported to the National Assembly and the Government and made public in accordance with regulations. These disclosures create positive pressure on agencies and organizations to fulfill their environmental protection responsibilities, promote accountability, and enhance openness and transparency in environmental governance.

Through audits relating to climate change, sustainable development, and environmental programs, the SAV has provided objective information and evidence to support state management and decision-making. These activities have also reinforced its role as an independent oversight body in monitoring the implementation of international commitments on the environment and sustainable development.

Legal Gaps

Nevertheless, practical implementation has highlighted an urgent need to further improve the legal framework for environmental auditing. According to the research team, the Law on State Audit does not yet contain specific provisions governing audits in the environmental sector. The scope of audited entities and matters remains primarily linked to public finance and public assets, while intangible environmental factors have not been clearly defined.

The term “environmental auditing” is understood differently under the Law on Environmental Protection and in the SAV's auditing activities, particularly in terms of responsible entities, objectives, and underlying nature. This may cause confusion during implementation. The SAV's authority to conduct environmental audits is largely established through cross-references to other legislation, without clearly defining the scope, methodologies, data access rights, or the ability to audit non-public-sector entities that have significant environmental impacts.

Internal regulations and methodological guidance also lack detailed instructions on determining non-financial materiality, establishing environmental impact assessment criteria, and developing specialized templates for environmental audits. Environmental data remains fragmented and poorly interconnected, with no established mechanism for regular provision to the SAV, limiting its ability to conduct risk analysis and apply big data analytics. The number of auditors with specialized environmental expertise also remains limited.

Sector-specific environmental protection legislation contains provisions that are qualitative in nature and lack measurable criteria. Some national environmental technical standards have not been updated promptly and do not adequately cover emerging issues such as microplastics, greenhouse gases, emerging pollutants, and transboundary environmental risks.

Expanding Audit Scope and Strengthening Risk Management

To improve the effectiveness of environmental auditing and meet the requirements of environmental protection, sustainable development, and Vietnam's international commitments, the research team recommends amending and supplementing the Law on State Audit to ensure consistency with the 2020 Law on Environmental Protection, Vietnam's international commitments, and modern environmental governance requirements. This would also enable the SAV to expand its audit scope to emerging areas such as greenhouse gas emissions, carbon markets, the circular economy, green finance, and the Sustainable Development Goals (SDGs).

The SAV should continue reviewing, updating, and improving its system of auditing standards, procedures, and professional guidelines to ensure consistency and alignment with new legal regulations. Professional guidance should incorporate additional methodologies for risk assessment, environmental materiality determination, evaluation of the effectiveness of environmental programs and projects, and auditing of emerging areas in environmental management.

Environmental audit results should be disclosed more proactively in ways that are accessible, transparent, and linked to specific environmental indicators. Mechanisms for monitoring the implementation of audit recommendations should be strengthened, alongside closer coordination between the SAV and state environmental management agencies in addressing violations identified through audits. Digital technologies, environmental databases, geographic information systems (GIS), remote sensing, artificial intelligence (AI), and big data should be applied more extensively to improve the quality of audit evidence, enhance risk detection, and monitor the implementation of post-audit recommendations.

The SAV should develop a workforce of auditors with interdisciplinary expertise; strengthen the monitoring, follow-up, and inspection of environmental audit recommendations; improve mechanisms for mobilizing and utilizing experts and interdisciplinary collaborators; and expand cooperation with state management agencies, research institutions, international organizations, and other supreme audit institutions to learn from advanced experience, methodologies, and practices.

As environmental governance increasingly emphasizes risk management and effectiveness, the coordinated implementation of these measures, particularly the improvement of the legal framework, will provide a solid foundation for the SAV to strengthen its role in overseeing and evaluating the effectiveness of natural resource and environmental management, supplying information for policymaking, and promoting sustainable development.