Summit picks out opportunities through the headwinds

Consultants, you could argue, thrive on change, and change was certainly the backdrop to Environment Analyst’s 2023 UK Business Summit, given a transitioning economy, rapidly evolving environmental legislation and the unpredictable outcomes of the COP28 climate conference in Dubai. 

The summit, which took place in London at the end of November, kicked off with an inaugural address by WSP’s Mark Hurley, who reminded the audience that there can be no growth of any sort on a dead planet. As the world, including the UK, reaches for climate solutions that can galvanise rather than paralyse the global economy, it was up to consultants to provide clarity, coherence and leadership, he said. "The stories we tell really matter. We have to be consistent, joined-up and coherent."

Market buoyant, despite constraints

The consolidation of the environmental and sustainability (E&S) consultancy market is having an impact on the delivery of services in the UK and globally, noted Ross Griffiths and Alice Pickthall of Environment Analyst, who provided context for the day’s discussions with a summary of our 2023 research findings. 

Key drivers of growth, they pointed out, include the net zero and decarbonisation agenda, international agreements and ESG investment, with constraints including skills and staffing shortages and the overall economic outlook. While the global E&S consulting market had grown by 16% to $45.6bn in 2022, there was scope, they predicted, for the total addressable market to reach over $100bn, as other regions reached the same intensity as North America.

Several speakers suggested that the UK E&S market is holding its breath. "Over the next two years or so we can expect a certain amount of inaction," predicted Matthew Farrow of the Broadway Initiative business alliance. This results from a "political divide," he suggested, as the current administration rows back on green initiatives such as EVs and a moratorium on new North Sea drilling licenses, while Labour offers its own version of a green industrial revolution. Perhaps ironically, said Farrow, it is Labour who might be expected to catalyse more private investment into rural communities and to boost the market for nature-based solutions and ecosystems services.

Farrow was taking part in a morning session on managing key disruptors. Fellow panellist Adam Savitz, of the technology services and consultancy firm Wipro, agreed that investment in rural communities could become a growth area after the next election. He also discussed data — in particular the ability of companies to use data selectively — as a potential disruptor. The common refrain of "I have the information, now what can I do with it?" invites a step-change in efficiency improvement.

Low carbon, high value

Bharath Krishnan of Monitor Deloitte offered an overtly more commercial response to the disruptor conundrum as it impacts on the energy transition and the journey towards net zero. "You really need to start thinking about carbon as a way to make money," he told the audience of consultants, many of whom are doing just that. 

Carbon-free emissions and circular products and materials could all be opportunities for UK firms to steal a march, he suggested. "This is about a fundamental rethink of how you do business and what you can deliver back in additional value." This seemingly complex process could be helped by the clever use of AI and machine learning which offered huge opportunities to solve problems at scale, added Savitz.

Less upbeat, less conclusive, it seemed, were panellists for the second session of a busy morning, looking at the future of Environmental Assessment (EA) as a tool to deliver sustainable infrastructure. As the dust settles post-Brexit, panellists were asked to consider the status of proposals for Environmental Outcome Reports (EORs) and how they might help to focus the findings of an EA without diminishing its process and content. Against this backdrop, Dr Daniel Slade of the Royal Town Planning Institute highlighted the exodus of planners from the public to the private sector, making it even harder to provide effective engagement with major development proposals. "A lack of confidence in the system stems from the lack of resources available," he said.

The other panellists, Natalie Prosser, CEO of the Office for Environmental Protection (OEP), and Josh Fothergill of Fothergill Training and Consulting, agreed that there was a resources issue in the UK which new legislation could not solve on its own. 

"There’s a fundamental disconnect between policy and implementation," said Prosser. "In January we published a report which identified that the government was not on track to achieve any of its commitments in the 25-year Environment Plan. This has got nothing to do with the law. It’s about access to expertise."

More resources and indeed more passion are also needed around EORs, said Fothergill. "It’s about better communication, more positivity and making information far more accessible." Consultants, he said, must inspire their clients and clients must deliver. Prosser added that vision, leadership and direction were also critically needed.

Positive about nature

A theme running throughout the summit was the potential of nature-based solutions and the partnerships that would make them work in practice. They came up in a quick-fire talk by Guy Thompson, group director at Wessex Water and managing director of its catchment management business Entrade,who stressed the importance of catchment management as an alternative to asset-based solutions. Thompson also admitted that "the water industry model is broken and needs a reset". The ensuing panel discussion focused on how to achieve a nature-positive economy.

This included contributions from Gemma Tooze (of the global coalition Business for Nature and Accenture); Vicki Hutchinson (AtkinsRéalis) and Howard Waples (of Tetra Tech). The goal, Tooze reminded, is to achieve a nature-positive economy by 2030 — and Business for Nature was set up in 2019 to drive credible business action on this front. "There’s a huge issue around language," she said, with parties struggling to engage with concepts such as regenerative agriculture and rewilding.

Clients are also driven by the fear of financial loss, said Hutchinson. "What is the risk that the thing I’m creating now is going to become a stranded asset [...] [or that we] can’t get insurance? The best success happens when we bring people together in partnerships to achieve benefits for nature and for people." 

Waples was one of several speakers highlighting the benefits of AI, for example to assess the importance of different habitats on a much larger scale, and how they might contribute to less tangible benefits such as climate resilience or mental health. 

It’s a grid thing …

The second panel discussion of the afternoon focused on the energy transition and decarbonisation. Training, skills, collaboration and UK grid connection were among the topics covered. 

"There’s a 50GW target for offshore wind by 2050 (in the sea or in the system) and this year we’re only looking at 1GW of new capacity in the water," said WSP’s director of energy Nicola Riley. "We need to upgrade our grid system — and the skills requirement to deliver all these projects is immense."

Ian Livingstone, a project manager for the low carbon Humber Cluster also highlighted net zero skills requirement, citing construction and trade skills in particular. 

The energy transition journey is underway, panelists agreed, but the mode of transport, not to mention the road itself, still needs plenty of attention.

Discussions at the summit confirmed that, despite constraints, the E&S consultancy sector will continue to play an important part on the road to net zero, both in the UK and globally. Skills for delivering leadership and innovation, harnessing the potential of change and delivering commercial returns in a transitioning economy are desperately needed — as is a release from political paralysis — but on balance, it was an upbeat message.