Environmental Audit and Compliance

Compliance with environmental regulations in the US hastraditionally been enforced through a system of monitoring andpenalties. While the system has resulted in environmentalimprovement in air quality, violations of the Clean Air Act stilloccur. This book evaluates the effectiveness of environmentalauditing and audit policies in the US in inducing compliancebehavior of the firms. We find facilities that self-audit are morelikely to be and stay longer in compliance with Clean Air Actregulations. Audit privilege and immunity policies have significantand opposite effects on facilities. While audit privilege policiesreduce incentives for compliance, audit immunity policiessignificantly increase them, particularly for firms that have highcosts of abatement and would otherwise have a higher likelihood ofbeing in violation.

Klappentext
Compliance with environmental regulations in the US has traditionally been enforced through a system of monitoring and penalties. While the system has resulted in environmental improvement in air quality, violations of the Clean Air Act still occur. This book evaluates the effectiveness of environmental auditing and audit policies in the US in inducing compliance behavior of the firms. We find facilities that self-audit are more likely to be and stay longer in compliance with Clean Air Act regulations. Audit privilege and immunity policies have significant and opposite effects on facilities. While audit privilege policies reduce incentives for compliance, audit immunity policies significantly increase them, particularly for firms that have high costs of abatement and would otherwise have a higher likelihood of being in violation.