Auditing is a formal examination of a department, process, person, records or system. . In Measuring Sustainability in Business by Richard Welford, there are five levels of auditing that might be carried out by a company trying to reduce its impact on the environment.

Level 1	compliance auditing (should be carried out as part of the initial audit) legislation, regulations, voluntary standards, consents and discharge permits.
Level 2	systems auditing (fundamental of EMAS and ISO 14001). Level 1 + Environmental Management Systems (EMSs) and self-determined targets and objectives.
Level 3	environmental auditing (going wider than EMAS and ISO 14001). Levels 1 and 2 + measurements of environmental impacts (including indirect activities such as air pollution caused by employees driving to work), health and safety, protection of employees and the community and contingency planning.
Level 4	ecological auditing (a more rigorous approach to product/process analysis). Levels 1 to 3 + inter-temporal impact on eco-systems, life cycle analyses of products, measurement of indirect ecological impacts, recognition of the need to live in harmony with nature.
Level 5	auditing for sustainability. Levels 1 to 4 + equity and equality, futurity, human rights and protection of indigenous populations, consideration of wider social and ethical issues, holistic approach.

Examples of larger companies already operating at levels 4 and 5 include: Hoover, who is putting its washing machines through life cycle analyses; Courtaulds (now Acordis), Unilever and SmithKline Beecham, who are carrying out life cycle analyses of some of their products; Cadbury Schweppes, who has a history of community development; The body background="/envENVMAN5/course/images/back/back.jpgshop, who is well known for its concern about indigenous peoples and fair trade; and B&Q, who only source tropical hardwoods from appropriately managed forests.

For the purposes of operating an EMS, internal and external auditing at Level 2 is applicable.