Environmental due diligence is a foundational step for any major project. Due diligence helps organizations identify and give context to liabilities before they become costly surprises. The money spent on due diligence is money well spent!
Even minimally invasive efforts (e.g., a high-level, early-stage desktop review) can reveal exposure to contaminated land, title issues, water rights issues, water sourcing insufficiencies, availability (or lack thereof) of power and other utilities, water stress, supplier noncompliance, hidden carbon intensity, and weak permitting controls, just to name a few.
In project development, robust due diligence efforts can improve valuation accuracy and reduce transition risk during every phase: concept » scoping » feasibility » engineering and design » execution » commissioning » service » retirement and legacy. Proper due diligence is a solid way to support ESG goals and promote sustainable supply chains; firms that evaluate upstream and downstream environmental impacts make better strategic decisions and avoid reputational damage.
As sustainability reporting standards mature, due diligence is becoming a practical bridge between disclosure and operational accountability.
References:
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Carter, C. R., & Rogers, D. S. (2008). A framework of sustainable supply chain management: Moving toward new theory. International Journal of Physical Distribution & Logistics Management, 38(5), 360–387. https://doi.org/10.1108/09600030810882816
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Pagell, M., & Wu, Z. (2009). Building a more complete theory of sustainable supply chain management using case studies of 10 exemplars. Journal of Supply Chain Management, 45(2), 37–56. https://doi.org/10.1111/j.1745-493X.2009.03162.x
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Sarkis, J., Zhu, Q., & Lai, K.-H. (2011). An organizational theoretic review of green supply chain management literature. International Journal of Production Economics, 130(1), 1–15. https://doi.org/10.1016/j.ijpe.2010.11.010