Sustainable Development Heads of Internal Audit Conference

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Sustainable DevelopmentHeads of Internal Audit
Conference

• Matt Jackson Sustainable Development Unit,
  Defra
• Matt Rylatt Internal Audit, Defra
• 19 October 2007

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• Securing the Future
• Government commitments and targets
• Defra as Sustainability Leader Programme (DaSL)
• Sustainable Development Action Plans (SDAP)
• thinksustainable and SD activities
• Role of Audit in sustainability
• Case studies Audit Commission and NAO
• Matt Jackson Team leader for Defra as
  Sustainability Leader (DaSL) team

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The UK Government Sustainable Development
Strategy

• Published 7th March 2005
• Sets out a vision of sustainable
• development through to 2020
• Has been developed across the UK,
• and with central, regional and
• local Government
• The focus is on moving from words
• into action the Government showing
• it is serious about delivery through
• leadership by example
• Also engaging and enabling business,
• communities and individuals to make
• a difference

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The UK Government Sustainable Development
Strategy

• Four priority areas
• Sustainable consumption and production
• Climate change and energy
• Protection of natural resources and environmental
  enhancement
• Creating sustainable communities and a fairer
  world
• And three key themes..
• Involving people
• Government leading by example
• Getting serious about delivery

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PSAs and Strategic Objectives

• Comprehensive Spending Review (CSR) announced new
  Public Service Agreements (PSAs) across
  Government
• key priorities for government for the period
  April 2008 to March 2011
• PSAs will be outcome (rather than target) focused
• underpinned by a small number of indicators
• Each PSA will have a lead government department
• Departmental Strategic Objectives also announced
• One of Defras DSOs is championing Sustainable
  Development across government, across the UK, and
  internationally

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Sustainable Operations on Government Estate (SOGE)

• June 2006 Government announced stretching
  sustainable operations targets
• March 2007 UK Government Sustainable Procurement
  Action Plan launched
• Goal is for UK to be among the EU leaders in
  sustainable procurement by 2009, to achieve a low
  carbon more resource efficient public sector
• Departments will be looking for solutions that
  best help them meet operations and efficiency
  targets plus comply with increasing range of
  government product standards.

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Sustainable Operations on the Government Estate
(SOGE) Targets

• Carbon
• Government office estate carbon neutral by 2012.
• Carbon emissions down 12.5 by 2010 (30 by
  2020).
• Carbon emissions from vehicles down 15 by 2010/11

• Waste
• Waste arisings down 5 by 2010 (25 by 2020).
• Waste recycled up 40 by 2010 (75 by 2020).

• Energy
• Energy efficiency/m2 up 15 by 2010 (30 by
  2020).
• 10 of electricity from renewables by 31 March
  2008
• 15 of electricity from CHP by 2010

• Water
• Water consumption down 25 by 2020.

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Defra as Sustainability Leader (DaSL) Programme

• Why the need for the programme?
• Defra rated middle-of-the-pack by SDC on
  sustainable operations (March 2007)
• A realisation that we need to do more to
  demonstrate our leadership credentials in SD
• There is good work going on around the department
  but there is a need for a collective focus in
  this area
• To maintain our leading the pack rating for
  Sustainable Development Action Plans (SDAP)

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Defra as Sustainability Leader (DaSL) Programme

• Key aim is to raise our level of ambition
• To achieve our key aim we will
• join up workstreams from across the Defra network
  to meet SOGE and our own ambitious targets
• improve communications both internally and
  externally to demonstrate leadership
• make Defra an exemplar of embedding SD in policy
  making across the Defra network and government
• add support of a programme structure to ensure
  delivery of targets

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Defra as Sustainability Leader Programme -
organogram
Senior Responsible Officer
Building capacity/capability Work with SDC Within
Defra across government
Programme Manager
Programme Office Defra
Sustainability Leader team
Role of support team includes Programme Delivery
Plan (SDAP), thinksustainable workstream
Co-ordination of SD Enthusiasts network and work
on ambition
Programme Delivery Plan
SD Action Plan
Defra Network
Estates Facilities
Procurement
Comms Strategy
HR CSR
IT/Smart Working
Developing Policy
Executive Agencies
NDPBs

• Travel (inc. air) grey fleet
• offsetting
• monitoring data
• Better procurement
• Flexible framework targets
• CSR diversity values as standard in contracts

Water Waste Energy Carbon Recycling Carbon
management programme
Information on actions Behaviour change Internal
campaigns Internal messaging External
communication
CSR HR Policy, e.g. diversity, the Deal,
encouraging volunteering, welfare Payroll
giving Employee engagement Performance and
absence management behaviour
Contribution of IT to energy efficiency carbon
reduction Procurement disposal of IT
equipment Smart working Thin client
Better policy making demonstrating SD
underpinning it Tools Impact Assessments Skills
(training)
Coordination by Programme Office (DaSL team)
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Sustainable Development Action Plans (SDAP)

• Defras first SDAP published in December 2005
• SDC critique on SDAP published December 2006.
  Defra cited as leader of the pack with DWP
• Progress report to SDC
• Second SDAP due October 2007 as part of DaSL
• All Executive Agencies to publish SDAPs for 2007
• Aim to be more joined-up and coordinated to meet
  targets and demonstrate leadership.
• Optional for NDPBs some have produced SDAPs or
  included ethos in projects
• Sustainable Development Commission provide support

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How can an SDAP benefit delivery?

• Demonstrates contribution to UK SD strategy
• Sets out future direction for organisation
• Highlights work programme to better integrate SD
• A driver for change
• Cross-cutting issues across Government
• Sets out agreed priorities and/or actions for the
  year
• Sets procurement, operations, policy and people
  at forefront of organisation
• Opportunity for support and to share best
  practice
• Focus for monitoring, review and stakeholder
  evaluation
• Ambitious targets demonstrate leadership

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SD Tools Stretching the Web, The bigger Picture,
Stockwatch http//www.defra.gov.uk/sustainable/thi
nk/index.htm Sustainable events guide
http//www.sustainable-development.gov.uk/advice/s
ustainable-events-guide.htm SD Enthusiast Network
and Sustainable Development Lunchtime Seminars
Awareness raising campaigns thinksustainable
week, The Big Switch.
Environmental Commentator Donnachadh McCarthy
Eco Audit walk
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Stretching the Web
The web is a simple graphic, based on the Cabinet
Office Impact Assessment (IA), to help
policymakers integrate sustainable development
considerations into policymaking.
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Role of audit in sustainability

• Internal practices in your own organisation
• e.g. business travel, Estates management, HR
  procedures
• sound understanding of how SD can achieve
  objectives
• leading by example in reducing environmental
  impacts
• changes to behaviour and practices
• External embedding as part of the audit
• SD as part of the judgement process
• vfm delivering environmental and social benefits
  
• decisions that take long term into account
• audits address economic, social and environmental
  issues
• audits need to recognise SD and encourage
• build SD principles into all regulatory work

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Audit Commission approach

• Primary aim is to embed SD policies within own
  organisation and those audited
• Focuses on environmental impact, locally and
  globally, of organisations that deliver local
  public services
• Promoting sustainability through audit and
  inspection work
• Use studies, website and relationships with
  stakeholders to encourage good practice

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Audit Commission actions

• Reduce travel carbon footprint (business travel,
  commute)
• Increase recycling and reduce paper use
• Include in contracts with suppliers
• Ensure new area risk assessment addresses risks
  to sustainability
• Reward sustainable approaches to asset management
  and procurement, and to assess organisations
  progress in reducing their carbon footprint

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National Audit Office key strands

• Value for money studies for PAC. Review economy,
  efficiency and effectiveness of programmes,
  including SD programmes. Recent SD studies
  include
• River and coastal flood defences
• Sustainable construction and refurbishment on the
  government estate
• Briefings for the Environmental Audit Committee.
  Greening government. Typically review progress
  towards targets, quality of analysis used,
  success of implementation. Recent studies
  include
• Climate change levy and agreements
• Cost-effectiveness analysis in the CCPR 2006
• Climate change options for scrutiny

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National Audit Office key strands

• International work share best practice across
  Europe and beyond. Recent meetings focused on
  climate change, where UK NAO has extensive
  experience compared with other audit institutions
• Collaboration putting sustainability into
  practice with other organisations

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NAO approach is evolving

• Aware that auditing SD may be complex
• Move away from compliance audit (purely
  target-focussed)
• Move towards assessing sustainability and vfm
  more directly
• Collaboration putting sustainability into
  practice with other organisations
• e.g. Prince of Wales Accounting for
  Sustainability Group
• NAO a key player, with Defras support, in
  producing a comprehensive website explaining how
  to embed sustainability at all levels of an
  organisation. Applicable right across the
  public, private and other sectors. Includes
  advice on what to do, how to overcome challenges
  and links to guidance, tools, useful links and
  real-life case studies
• Website launch due 12 Dec 2007

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Matt Rylatt Defra IAD

• Heads of Internal Audit Conference
• Internal Audit of Sustainable Development

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IAD strategy and progress

• SD internal audit strategy developed

• Although SD is Defras top priority, its high
  profile (and associated scrutiny) across
  government led to a low perception within
  business of its risk compared to other immediate
  Defra priorities, e.g. FMD, flooding

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IAD strategy and progress

• Audit of governance of the Sustainable
  Development Commission
• Review of work on Defras sustainable development
  action plan with the opportunity to rely on a
  (SDC) 3rd party assurance

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Review of strategy for auditing SD

• Defra strategy refresh
• CSR 07 and changes to PSA targets
• IADs revised assurance framework
• Revised IAD structure
• Progress on Defras SDAP

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Need for government internal audit divisions to
review SD

• PSA 27 Lead the global effort to avoid dangerous
  climate change
• Contributing departments
• Department for business, enterprise and
  regulatory reform (BERR)
• FCO
• Department for International Development (DFID)
• HMT
• Department for communities and local government
  (CLG)
• Department for Transport (DfT)
• DH
• MOD, Home Office, Ministry of Justice, HMRC, DWP
  key departments on the government estate
• Department for schools children and families.

• PSA 28 Secure a healthy natural environment for
  today and the future
• Contributing departments
• CLG
• DfT
• Forestry Commission
• BERR
• Department for innovation, universities and
  skills
• MOD
• Department for culture media and sports

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Internal Audit approach

• Review progress on the SDAP, drawing assurance
  from SDC
• What is the department doing to address
  feedback/recommendations from the SDC about the
  action plan?

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Internal Audit approach

• Seek to identify the extent to which the
  department is taking appropriate action, if any,
  in the following areas
• effective internal and external communications
  structures
• presence of an SD-based travel strategy
• effective policies on waste, water and energy
• a sustainable procurement policy
• inclusion of SD in (senior?) PDPs
• delivery of effective training on SD
• use of SDAP workshops
• engagement with stakeholders
• effective SD governance structures within the
  department
• evidence that SDAP is integral to existing work
  programmes

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Internal Audit approach

• Review business plans and risk registers by
  reference to the relevant departmental strategic
  objectives, outcomes and indicators to identify
  work with an element of SD in it for prospective
  inclusion in the audit plan
• Engage with business leads

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Internal Audit approach

• Make use of Defra IADs framework for
• Policy development and policy review
• Development of operational systems and
  procedures
• Use of policy development tools as a basis for
  implementing SDS issues

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Auditing sustainable development within business
units

• Action taken to implement SDS into policy
  development and policy review
• The basic issues to be covered should include
• Awareness of the Sustainable Development Strategy
  (SDS) within the Policy Division
• Identification of areas where policy is due for
  review or new policies are required
• Action taken to assess the impact of SDS
  considerations on those policies.
• Creation of local SDS evaluation/implementation
  team
• Liaison with the Sustainable Development Unit
  (SDU) or similar
• Practical difficulties with implementing
  sustainable development
• Need for SDS to be amended to meet the needs of
  particular policy areas
• Development of appropriate targets/performance
  Indicators
• Effectiveness of measures in assessing the true
  effectiveness of sustainability elements of the
  Policy
• Provision of training in SDS issues, by whom, who
  has received training?

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Auditing sustainable development within business
units

• Implementation of SDS issues in development of
  operational systems and procedures
• The basic issues to be covered should include
• Translation of policy into robust operational
  systems and procedures
• Full consideration and implementation of
  sustainable development issues contained with the
  policy
• Effectiveness of operational objectives, systems,
  procedures in enhancing sustainable development
• Monitoring of targets and performance indicators
  
• Suitability and adequacy of data sources for
  target/performance indicator information, to whom
  and at what frequency is monitoring information
  reported?
• Feedback from SDU/similar
• Training for staff is effective and includes SD
  considerations.

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Auditing sustainable development within business
units

• Use of Policy development tools as a basis for
  implementing SDS issues
• Check that department is using Impact
  Assessments, incorporating consideration of SD
  when developing policy
• Check that department is making use of Defra
  tools, e.g. stretching the web which identifies
  the extent the policy impacts on SD (DWP
  currently reviewing)