Greening the networked economy - Environmental Reform in the Information Age - page 168

organisations and institutions: national audit offices, audit commis-
sions, audit guidelines and codes, private auditing companies, global
standards for auditing and so on. Moreover, the organisations and insti-
tutions started to shift their focus from conventional financial auditing
to all kind of other fields and domains, including the environmen-
tal domain. 8 And, indeed, in a substantial part of his topic, Power
discusses practices, institutions and developments in environmental
auditing. The background of this auditing explosion is to be found in
new forms of governance and accountability at the crossroads of the
public-private divide, 9 and the growing amount, diversity in sources,
and complexity of information, without any clear undisputed author-
ities that validate (environmental) knowledge and information.
Environmental auditing - in a more narrow focus related to eco-
nomic production - connects to all kinds of activities to monitor, assess
and certify the environmental management and performance of individ-
ual companies. Originally in the United States, environmental auditing
developed as an internal governance tool for the company manage-
ment to monitor, control and manage the environmental quality and
performance of its various production plants, sites, lines and products.
The background for this development was to be found in both the
market, where credit institutions and insurance companies asked for
certainties on potential hidden liabilities (cf. Gunningham and Prest,
1993 ), 10 and the state, where increasing requirements from govern-
mental agencies in licensing, monitoring and reporting and compliance
forced companies to standardise and organise their internal procedures
more systematically.
Especially in transnational corporations, with plant locations or
firms spread throughout the world, information systems are of key im-
portance in harmonising company environmental governance and per-
formance. Under various pressures, among which those of a globalising

8

Power ( 1997 ) discusses the broadness and imprecise character of the category
auditing, which entails numerous activities that are often very different in
nature. But any stricter definition will exclude activities that are currently
labelled auditing, making such a more 'scientific' definition not very useful.

9

See, for instance, the analysis by Stretesky and Gabriel ( 2005 )ofthe 1995
Audit Policy of the U.S. EPA, where companies are encouraged towards
self-policy by discovering, disclosing and correcting their own violations of
environmental acts (in their case, the Clean Air Act).

10

In an empirical study on the impact of two U.K. insurance companies on the
environmental performances of their clients, Minoli and Bell ( 2003 ) found out
that such insurance companies are still weak environmental regulators.