Optimistic yet realistic - ERM boss
This is the attitude of ERM's Keryn James, and it reflects the positive actions of her company in these turbulent economic times. Tom Idle met up with the firm's new managing director of UK & Ireland to discuss future challenges, and some of the solutions
As the new managing director of environmental management consultancy Environmental Resources Management (ERM), she recognises that market conditions have changed. And, if her organisation is to remain on solid ground throughout this recession, she says its imperative it knows exactly what impact the downturn is having on its clients.
Because of the nature of the environmental consultancy sector - sprawling, largely compliance led, with plenty of big, publicly financed projects - one could argue it is better placed than most industries to see off the dire economic situation currently enveloping the world. No doubt there will be strugglers, blighted by the caution of businesses large and small, reluctant to outsource EHS work.
For ERM, though, there are still plenty of opportunities out there. "We have always come out of recessions with greater market share," Keryn tells me across an oversized boardroom table at ERM HQ in the heart of London's financial district. She took the reins of the UK business little more than two months ago and I'm keen to discuss her strategy for the company in these challenging times. It's certainly a daunting time to take over isn't it, I ask her. "It's daunting to take on an MD role at any time," she responds. "But the difficult times help you to have focus on what the important things are and where to prioritise."
ERM's priorities are topped by its key client programme. The concept - employed by a number of other big consultancies too - is about identifying the clients you want to work with both globally and locally, and building good relationships with them to get more and more work. Winning more businesses with a smaller number of clients keeps costs lower. "It's better for them, better for us," says Keryn. "But, beyond purely financial implications, it's a far more rewarding experience because our staff get to know our clients extremely well. It also gives us the chance to place people within organisations for a period of time, allowing them to get challenging career development opportunities.
"Because of those relationships, we are able to work at a much more strategic level."
With 3,500 staff operating out of 145 offices in 41 countries, the global network of ERM personnel will also play a part in this positive reaction to the downturn. Its ability to pick up work across the globe, particularly from China, India and Latin America, will ensure dents in its turnover statistics can be ironed out. In previous years, the growth for ERM has come from the US, the UK or Europe. In the next two or three years, a substantial portion of that growth will come from Asia, Africa and Latin America, says Keryn. "We are not an organisation of individual operating companies. We are a strongly networked, global organisation. ERM offices work collaboratively and we are in a strong position to move resources and skill sets around the globe as we need them - for the benefit of our clients." For ERM, it's about either getting the projects to its people, or the people to the projects, to take advantage of the whole raft of industries keen to exploit different geographies.
And it is with these geographies that Keryn is familiar. Born and raised on a farm in western Australia - instilling in her an appreciation for the environment and an understanding of the human impact on it - she has operated throughout the Asia-Pacific region. With an educational background in urban planning, she began her career at a consultancy in Canberra - "a weird, sterile city" - before being made redundant - "the best thing that ever happened to me".
She soon found herself "doing the usual backpacking thing" around the world, including some time spent in the UK, before heading back home "penniless and jobless".
A successful spell at an Australian planning and environmental consultancy, for which she was put in charge of a key client programme across the country, brought her to the attention of ERM. During her most recent spell with the firm, Keryn headed up the development side of the business, focusing on impact assessment, contaminated sites and the strategic services team. When the previous UK managing director, Steve Laking, took over operations in Asia, Keryn stepped up.
"The market has changed dramatically," she tells me, "even in the last three months; let alone the last six or 12 months." She says she is keen to look at the business as it currently stands, and to question whether it is well positioned to take advantage of the market - a market of which she is realistic, yet optimistic.
Mergers and acquisitions work has dried up. And contaminated land has quietened down - "not because there are no clients out there that want to do things, but they have been cautious about large remediation projects".
But Keryn's confidence is supported by ERM's involvement in projects such as the Ebbw Vale scheme in South Wales. "Public sector spend on these types of projects shows no sign of waning," she says. The scheme involves the regeneration of a former steelworks site, heralded as a benchmark for sustainable development in the UK. In what started off as a simple remediation job, ERM is now leading the entire sustainability element of the project - not just carbon control, but tackling social issues too. The project, costing around £350M, will result in 700 homes and a new train station.
Next up is a job establishing the sustainability criteria for a project in Cinderford, in the Forest of Dean, to create a multi-use space, including hotels, offices and business units. "Those types of projects will continue to flow, particularly from the public sector."
Other potential areas for growth include compliance assurance and sustainable development reporting, climate change, and lifecycle assessment. And, with a smaller budget, clients want to understand what their biggest risks are, so as to focus their spending on the most important things - so the risk management business is likely to grow.
ERM applies methodologies to climate change in a bid to help clients understand not only their impact on global warming but the likely impact of an increase in global temperatures on their business.
Keryn is keen to ask some questions: "If climate change continues, and if these weather patterns continue, where are we going to see flooding? Where are we going to see fire, drought, water shortages? What impact will that have on businesses that rely on a high level of water use?
"It's about developing a risk tool to help them understand how likely a combination of those kinds of scenarios might be and what impact it would have on their business in financial terms."
And it is this fairly new emphasis on the economics that has led to a "very hard edge to sustainable development," according to Keryn. "It's about energy efficiency. It's about saving cost. What we are going to see is more of an emphasis on how SD can help businesses be more sustainable in a financial sense."
One stumbling block ERM might confront - and the wider environmental consultancy market in general - is that of a lack of skilled professionals to do the work. Keryn says it's one of ERM's biggest challenges, as it grapples with trying to find appropriately skilled impact assessment practitioners, particularly for the oil and gas market. "You can put an advertisement in the magazine, perhaps," she suggests.
In this period of uncertainty, Keryn assures me that ERM's dynamism will pull it through. "We feel we have a strong business," she states. "But we need to be very aware of what's going on and prepared to make quick decisions.
"We are careful about staying close to our clients and speaking to them as much as possible - trying to understand what is going on in their business. They all still have EHS budgets but it's a question of what is most productive and how they can get most value from their spend in this period of time."
With 20 years' experience in the environmental impact assessment arena, Keryn seems confident her current employer will weather the storm. "Yes, there will be some blips and issues, but we are well positioned to take advantage of it. I'm cautiously optimistic."