A water company has been ordered to pay a record £20.3 million to send a message to the board and its shareholders that poor environmental governance will not be tolerated. It is by some margin the largest fine under the Sentencing Council guideline for environmental offences.

Thames Water Ltd, a utilities and waste management company responsible for the public water supply and waste water treatment in large parts of Greater London, was ordered to pay £19.75 million in fines and £611,140 towards the Environment Agency’s costs.

The offences related to polluting the River Thames with almost 1.5 billion litres of untreated sewage. The offences took place at the Aylesbury, Didcot, Henley and Little Marlow treatment works and a pumping station in Littlemore. The company was prosecuted for each of the six pollution offences by the Environment Agency. The fine was said to reflect a “continual failure to report incidents” and the company’s “history of non-compliance”.

The case is an example of the tough sanctions that the courts are imposing on those who fail to comply with environmental legislation. Coupled with much greater sentencing powers, all businesses need to ensure that environmental compliance is given due attention at board level.

Prevention is better than cure and in our experience those clients who embed environmental compliance into their corporate governance are in a better position both to manage incidents when they do happen and to avoid the more serious sanctions. Mistakes and accidents do happen, and environmental offences are predominantly strict liability, meaning that criminal offences are committed even if no-one is at fault.

We have worked with businesses on preparing incident response plans and rehearsing those plans, enabling the teams to be prepared to move quickly and take control of incidents. Businesses should also be aware of the full range of enforcement options and give early consideration to mechanisms such as enforcement undertakings which enables them to take control of a post incident investigation.