Atkins realigns for economic downturn, low-carbon future
10-Feb-09
By training, David Nancarrow is a scientist. With a first degree in chemistry and an MSc in radiation and environmental protection, this is a man who likes the challenges that scientific detail offers. It makes sense, then, that he has developed a career in environmental consultancy. Erin Gill speaks to Atkins’ environment director, David Nancarrow
Since 2002, Mr Nancarrow has led the main environmental consultancy division within the corporate giant that is Atkins, having spent the decade before honing his technical skills as a consultant within the engineering and design firm. Under his leadership, the environmental consultancy business has grown from employing 95 staff to more than 200 today, sitting within the 1,800-strong Atkins water and environment division.
Atkins claims that its environmental consultancy is one of the three largest in Britain, although it represents only tiny fraction of the group’s entire business, which at the end of 2008 employed more than 18,000 personnel in the UK.
Tough jobs
When David Nancarrow talks about his staff and the types of projects they prefer to be involved in, it is clear that technical difficulties and doing something others have not yet tried rate highly on his agenda. “Our people like a good technical challenge, so we try to pitch for the toughest jobs. This allows us to differentiate ourselves, charge a bit more, and do something that isn’t bog standard, something that pushes the frontiers a bit,” he says.
An example is Atkins’ approach to contaminated land work. Instead of spending the last few years pursuing lucrative, but largely predictable work for property developers, Atkins chose to build a team known for its excellence in human health and groundwater modelling, working on the most complex sites where contaminants present in soil and/or groundwater pose significant risk assessment challenges.
As much as Mr Nancarrow relishes a technically-challenging project, he is also keen to understand the real world context in which his clients operate and, over the years, many of his favourite pieces of work have been those that provided clients with crucial information to assist them in making key investment decisions. “The projects I have personally enjoyed most have probably been due diligence work for major companies. For instance, some of the environmental auditing I did in the 1990s, at just the time when companies were being privatised in central and eastern Europe. We worked on complex projects, such as the privatisation of a big steelworks in Bulgaria and a gasworks in Hungary.
“It was exciting because one of the things Atkins can offer, that most of our competitors cannot, is not only can we do the environmental work at a steelworks, we can also bring along a colleague who can tell you how long that blast furnace is going to last, what you might need to do with it, and where it fits within the spectrum of European blast furnaces. It’s our breadth and depth of expertise that makes us interesting to financial institutions.”
Economic realities
Despite announcing healthy first-half results for the current financial year (see EA article, 05-Dec-08), Atkins has begun 2009 by making several hundred redundancies, with jobs mainly going amongst design and engineering staff (see EA article, 27-Jan-09). Whether Atkins will have to reduce the size of its environmental team in order to see it through the recession remains to be seen, but it is a distinct possibility. The official line is that it the company is more resilient to economic slowdown than many of its rivals, but not immune to it.
“Based on the large number of CVs we’re receiving I would say the recession has been affecting the environmental consultancy sector, but less so than it might have done in the past when green issues tended to be put on the backburner during a downturn,” David Nancarrow surmises.
Atkins’ long-standing focus on public sector work, particularly its framework contracts with the Environment Agency, and success in winning major infrastructure contracts that require environmental input should help the PLC weather the stormy times ahead. However, given the gloominess of recent UK economic forecasts, Mr Nancarrow is not interested in being excessively bullish about the short-term prospects.
“We’re involved in some major highway schemes – the A14, the M74 – and we're excited to have been appointed to the London 2012 Olympics. We've been working on Olympics-related projects since 2005. These and other large infrastructure projects are very important for us,” he explains. In addition, Atkins does a good deal of environmental impact assessment work for power sector clients and is looking forward to the construction of new nuclear power stations in the UK.
Mr Nancarrow's team is also hoping to take on more international work, despite a tradition of focusing primarily on domestic projects. “We are looking to see whether we can increase the amount of overseas work we do, given the weak pound. We’re bidding for more international work than I can remember for a while within my area of the business.”
Low-carbon impatience
Ultimately, there is only so much consultancies like Atkins can do in the face of a recession as severe and complex as the one the UK has entered. What frustrates David Nancarrow is the government’s apparent unwillingness to respond to the crisis in a way that will set the UK up for long-term success in a carbon-constrained world. “I really feel that the government is missing an opportunity to invest in low-carbon industries to position Britain well, using high environmental standards as a driver for future economic growth. It’s a compelling argument and yet it’s one to which the government pays lip service.”
Mr Nancarrow may be polite in the way he phrases his criticisms, but there is no doubt how seriously he views the need for quick steps to be taken toward a low-carbon future. “We’re not even providing incentives for householders to insulate their homes better,” he laments. “We need real changes in the economy and some real incentives. We don’t want other countries to be streets ahead and to have all the expertise in these areas simply because we didn’t make the effort to engage earlier. We know we’ve got to reduce our carbon dioxide emissions by 80% by 2050. Stern says it makes sense to do it early, not late.”
Mr Nancarrow suggests the introduction of carbon taxes to replace salary taxes. “If government were to take the need to develop a low-carbon economy seriously, environmental consultancies would lose no time in supporting low-carbon policies and in creating business opportunities for themselves and their clients,” he argues.
In the meantime, Atkins is getting its systems in order by developing high-quality carbon modelling and carbon-critical design capabilities across the group, not just in the environmental division. “People often overstate how much carbon-related work is being done out there, but we have seen good growth in this area and in the broader sustainability arena,” says Mr Nancarrow.
“Carbon as an issue is moving up to board level, and clients are beginning to think about it strategically, financial institutions particularly so,” he adds. With climate change and energy security continuing to focus minds despite economic worries, Mr Nancarrow does not think climate change will be sidelined excessively during recession. “One or two of our carbon-related projects have had delays in being commissioned, but they’ve gone ahead. There’s a sense in which these issues are not going to disappear off the agenda. Maybe if the recession had come a few years earlier they might have.”
Another area of consultancy that David Nancarrow believes may grow despite the economic doldrums is resource management and efficiency. With greater use by UK companies of environmental management systems, clients are able to see more easily the ways in which resource efficiency can net them financial savings. “We are currently helping the Environment Agency develop tools and a road map for incorporating resource efficiency into its core strategy for implementing environmental permitting regulation. The EA wants to promulgate best practice but also to regulate more effectively,” says Mr Nancarrow.
This project should lead to opportunities to do resource management work for industrial clients keen to reduce costs during a recession, he reasons.
Back to the beginning
Like many senior managers within environmental consultancy, Mr Nancarrow enjoys the multidisciplinary nature of the sector, “how varied it is”. Indeed, so unwilling is he in remaining confined within any type of silo that a few years ago Mr Nancarrow achieved a long-standing dream and became qualified in the field of health and safety. “Towards the end of my first degree, which was in chemistry, I felt I would like to get into health and safety, but at the time the Health and Safety Executive wasn’t recruiting, so I did an MSc in radiation and environmental protection and through a lecturer on my course, I joined a technical consultancy doing radiological assessment and repository post-closure safety case modelling,” explains Mr Nancarrow.
From then on, apart from a stint with the National Audit Office assessing the effectiveness of UK pollution regulation, Mr Nancarrow’s career as an environmental consultant continued without deviation. “In 2003, I was asked whether I would become health and safety director for Atkins' water and environment division, as an extra dimension to my role. It took me back to the aspirations I had had at the beginning of my career,” he says, clearly delighted.
It is this ability to capitalise on opportunities when they arise, combined with a commitment to detail, that has acted as such a recipe for success for David Nancarrow. This same combination may prove highly effective in the economically turbulent times Atkins now faces.
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