The pressure’s on for environmental consultants who have to keep up with changing regulation and new demands while juggling costs and staff. Richard Collins reports.

Environmental consultants and those they serve agree, costs pressures and skills shortages are the key challenges for the sector. They’re hardly alone though in an economy running unemployment rates at 30-year lows, despite public and private sector efforts to poach offshore talent.

Every two years, WME surveys readers about their experiences employing environmental consultants and then surveys the consultants themselves about the state of play. The results this year reveal satisfaction levels remain stable, but a strong theme coming through additional feedback from users centred on problems of staff continuity, poorly structured advice and missed deadlines, suggesting there is no cause for complacency.

One of the more strongly worded responses: “Many lack sound, credible and validated methodologies and are unable to produce educated, informed, illuminating and auditable outcomes”. The author went on to call for “outcomes of substance; honestly blunt, direct and, where true, then confrontational to our business practice and policy”.

Consultants themselves acknowledge many of these challenges, in particular the difficulty of holding onto quality staff in a tight labour market without blowing out costs. Wage rises of 15-20 per cent a year at the top end of the sector have been reported.

But consultants point to another issue too, the increasing complexity of regulation and the sheer pace of change. Noted one: “There are changing legislative requirements and mounting pressures on business to expand quickly, but that often leads into areas of chemical, environmental and risk management”.

Throw in growing community expectations around environmental performance and it’s no wonder consultants feel under pressure. While business and councils complain of missed deadlines, consultants talk of the “urgency demands imposed by clients”.

Take the $9 billion Water Grid nearing completion in south-east Queensland following 11 million man hours of work. Premier Anna Bligh earlier this month was crowing the “end game” is nearly in sight on one of the state’s largest and most politically sensitive projects, with many elements completed ahead of schedule, including the $40 million Bromelton off-stream storage.

Enter the corporates
Engineering is feeling the pinch more acutely than most – Engineers Australia puts the national shortfall at about 28,000 jobs – but the dynamics elsewhere are almost as challenging as environmental and resource efficiency issues are mainstreamed.

The east coast states have all required their biggest water and energy users to develop detailed savings plans; environmental impact assessment processes become ever more complex; waste disposal costs are edging upwards in most states; and reporting requirements are on the increase.

Then, of course, there is carbon. The coming emissions trading scheme and the new National Greenhouse and Energy Reporting (NGER) scheme roping in up to 1,000 firms have put the issue on the top table for the first time, with chief financial officers in many cases starting to get involved.

Scott White from recruitment specialist Principal Consulting says mainstream business is struggling to keep pace with the changes.

“Corporates do not know how to do this and don’t necessarily even know what they are looking for, so they get a consultant to set up the systems and provide strategic advice,” he says.

Where there’s opportunity there is competition and the looming threat for environmental consultants is coming from the big management consultants. Both KPMG and Ernst & Young have doubled the size of their sustainability and climate change groups in the last two months to around 35 staff, with energy and emissions auditing under NGER regulations seen as a particularly juicy carrot. Mid-level firm Pitcher Partners a year ago launched an environmental services arm for medium sized companies.

It is territory the larger environmental consultancies had been staking out for some time, and which they will not lightly give up. Greg Loftus, NSW business development manager for URS, says the management consultants tend to take a minimalist, numbers-driven approach rather than a holistic systems-based perspective that looks behind the risks and proactively develops solutions.

White flags a growing issue: where to find skilled staff when “these jobs did not exist two years ago”? Many are looking offshore, but Sinclair Knight Merz is hoping to develop them in-house. In June it created a new role of Chief Sustainability Officer and appointed the technology and innovation manager from its environment business, Nick Fleming. His brief is to “spearhead a united front on sustainability and to embed required skills across the firm through a learning and development framework”.

A new vision is needed
Such tensions highlight a deeper issue for environmental professionals, which is to define their role in a rapidly changing world that is seeing the focus shift from environmental compliance to value creation.

When PR giant Ogilvy brings in a dedicated life cycle analyst, Ingrid Cornander, you know environment is well and truly out of the back office. When a requirement of NGER is for reports to be signed off by a financial auditor, you know the dynamic has changed unalterably. When Treasury Secretary Ken Henry talks about the “social, environment and economic impacts” of the tax system in releasing a review in August, you know triple bottom line has hit the mainstream.

The Environment Institute of Australia and New Zealand (EIANZ) has been exploring the issue for some months and found its members felt ill-prepared for new dynamics such as climate change adaptation. As yet there are no clear pathways forward and little sign that life is going to get simpler for environmental consultants – or those that employ them.