How Does an Auditor Think About PFAS-Impacted Sites? Auditor Insights from Past Projects

PFAS Liability Surge

Per- and polyfluoroalkyl substances (PFAS), known as forever chemicals for their persistence, have triggered a regulatory tightening in Australia. The key shift came on 1 July 2025, when the Industrial Chemicals Environmental Management Standard (IChEMS) banned the manufacture, import, export, and use of PFOS, PFOA, and PFHxS—three legacy PFAS compounds long phased down but still present in historical contamination. This prohibition, classifying them as Schedule 7 chemicals posing serious irreversible environmental harm, closed off exceptions except for trace unintentional contamination below thresholds like 0.025 mg/kg and limited research uses.

Compounding the ban, the PFAS National Environmental Management Plan (NEMP) version 3.0, endorsed late 2024 and published in March 2025, introduced revised health-based and ecological guideline values for soil, water, groundwater, and biota. It shifted emphasis toward sustainable remediation hierarchies that prioritise treatment over disposal, alongside better tools for demonstrating cleanup success and managing residual long-term risks—changes that make underestimating PFAS presence far costlier.

These updates arrive amid ongoing discoveries of widespread contamination from historical uses, especially aqueous film-forming foams at Defence bases, airports, fire stations, and industrial sites. Communities near such locations, including some with drinking water exceeding the tightened 2025 guidelines (PFOS down to 0.008 µg/L, PFHxS to 0.03 µg/L, PFOA to 0.2 µg/L), face exposure risks that have affected tens of thousands. A Senate inquiry in late 2025 delivered 47 recommendations, pushing for national monitoring, standardised drinking water rules, and potential funds for severe site cleanups.

The stakes are concrete: property due diligence now requires thorough PFAS screening to avoid inheriting multimillion-dollar remediation obligations or long-term liability for groundwater plumes that show limited natural breakdown over years. Industries risk regulatory notices, fines, or operational halts if sites are found non-compliant with the new framework. Non-obvious tensions include the gap between auditors' conservative risk views—often highlighting underestimated long-term threats—and pressures for quicker site redevelopment or lower-cost containment strategies that may not satisfy evolving standards. Defence and other legacy polluters face calls for greater accountability, while the difficulty of fully destroying PFAS drives debates over disposal versus emerging treatment technologies.

In short, PFAS issues have moved from niche environmental concern to a major driver of site assessment and financial risk across Australia.