The Future of EHS: Growth, Risk & Global Trends

Hello, I'm Angie Dixon, President of the Inogen Alliance.

Welcome to our bonus episode podcast, Rethinking EHS. I'm very excited to be here today with Ross Griffiths, the Managing Director of Environment Analyst. Ross and I have spent many times chatting or listening to different statistics and thoughts about what's happening in the environmental consulting industry. So really happy to have you here with me today. Thanks, Ross.

Ross Griffiths (00:33.364)

Thanks Angie, can I just say thank you for having me on? I'm really looking forward to our chat together.

Angie (00:38.444)

Good. And I heard this was your first podcast. So this will be fun, right? No pressure. Definitely not. Definitely not. So, okay. So let's start with environment analyst. Of course, I know you and the Inigen Alliance knows you and our consultants know you, but maybe you could give us a little bit of perspective. What do you do and how do you contribute to the industry?

Ross Griffiths (00:40.712)

Yeah, so yeah, hopefully I don't mess it up.

Ross Griffiths (00:59.922)

Yeah sure, so environmentalist is a global market intelligence events and media business.

operating globally. We serve engineering, environmental and sustainability consultancies worldwide and we provide companies like Energen and like Tonkin and Taylor and like Antea with market intelligence, news, insights, but also network and opportunities that can help them get a strategic advantage in the market by being informed and being well connected.

Angie (01:31.758)

Perfect. Well, as we all know in consulting, we're always trying to understand what do our clients need, where do they need it, and sort of at what technical level and what price point, all those things to provide great service. sounds like a very useful service. So thanks. So let's talk about history. If you think about the environmental consulting company or the environmental industry, what have been some of the historical trends that have impacted it over the last few years?

Ross Griffiths (02:00.542)

Yeah well, I mean it's fair to say the sector's been on a bit of a roller coaster over the last few years to say the least. Yeah, mean, wow. There's been so many different pinch points that the sector's had to navigate going way back to the global financial crash but...

If you think recently, since the pandemic, think the years 2022 to 2025, I would say we're characterized by an almost universal acceptance and buy-in from stakeholders of all types that actually the climate change was happening, is happening. We need to transition our energy markets to more sustainable forms. We need to reach net zero. We need to shore up our supply chains. So there was this great

of

buying from across the world, felt, towards that. And that helped shape the industry, it helped prompt some really high growth rates in the environmental consulting sector over that period of time. And I'd say from 2025 onwards, the market has continued to grow really strongly. But there's a little bit of an uneasiness settling in about the economy and about the politics and global conflict, about the language around sustainability. And we seem to have kind of returned to a sort of

of a shareholder primacy kind of landscape where it's very transactional. regardless, because of all this change in adaptation, think from a client perspective, it's no doubt that in the last five years, the environmental consulting sector has grown by about 54 % globally. So a huge transformation. And I think it shows that clients to solve these challenging EHS and environmental

Ross Griffiths (03:46.803)

environmental issues that they have are more willing to use environmental consultants, the HS providers around the world to solve their challenges. One other thing that I think is quite interesting is a lot of the environmental practices are part of group engineering firms. we've seen over the last, since 2019, the proportion of their revenues, group revenues that come from environmental consultancy is growing from 19 % to about 32%.

So these environmental specialists are playing an increasing role within big multidisciplinary organisations which I've found fascinating.

Angie (04:28.088)

So sounds like it's a pretty...

I mean, I think we feel that shift in the industry, even in our economies, for companies trying to, or multinational organizations trying to navigate. mean, we're a global economy as I see it. It's really hard to say, okay, the US is going to sit over here and the UK is going to sit over there and fight all the other countries in between. So that global economy and all of the different perspectives that are coming from a regulatory standpoint, but also I think from a consumer standpoint,

That pressure from consumers and their expectations that companies are doing the right thing, no matter what they're calling it, whether it's ESG or sustainability or environmental, but they're doing the right thing and being responsible, regardless of what regulatory framework is being put in place. Are you seeing that as well?

Ross Griffiths (05:17.842)

Absolutely and I think we're just working through our US market assessment right now. It's getting published in a couple of weeks.

And one of the really interesting things about it is we're revising up the forecast from what we had last year and it's because we're not actually seeing any drop off in demand for our ESG and sustainability services necessarily. We're seeing the language change. We're seeing the way that it's referred to is very different, but the actual underpinning drivers are still there, very much so, regardless of what administration is or what part of the world you're in. So yeah, the drivers still there and I think we'll get on to some of the major

trends in a little bit. But I do think the way that sustainability, EHS, environmental compliance can be used to boost your bottom line and reduce your risk, it's just going to be an ever-growing driver.

Angie (06:11.084)

Yeah, well, that's a good segue into trends. So let's think about 2026. What are the major shifts and factors that organizations are looking, how they're preparing across that environmental landscape?

Ross Griffiths (06:23.954)

Yeah, well, I mean, it seems kind of obvious to say, right, given what's going on in the world right now. But the rising cost of energy, I think, is really starting to shape drivers in the industry and shape global economies more broadly. So I think we're seeing clients look at those oil prices now and thinking to themselves, I need to reduce my reliance and my exposure on these energy markets. energy efficiency, on-site renewables, conventional

or carbon capture storage are all going to really an interesting play in the next few years. And I think that's only going to accelerate because energy prices have been going up for years. They're more volatile than ever before. So I think that's a real interesting element of the market for sure. I do think, as I mentioned before, that need to secure return on investment and risk reduction means that clients now want their environmental specialists

and sustainability specialist to be economically astute and laser focused on business outcomes in a way that I've not seen before. I mean, it was always part of the, you know, any tender, right? It always had value in there, value to the end customer. But I do think that if your bid writers or your project managers or your report authors cannot translate those environmental solutions into value creation, I think you could be exposed to those projects coming under scrutiny.

me and that's a real change in the market that I've seen personally. Digital adaptation is another one and I know you did a really good podcast on this that I watched so it was very interesting but I think the AI revolution is changing the sector in all sorts of ways. There's the obvious ones of the services you provide to your clients but then there's the piece about how are you valuing that work that involves

they are and how are you billing it? Are you doing value-based pricing? Are you still doing hourly pricing? What does these solutions mean to your graduates or your new staff that are just coming through the company? You must have seen this too, Angie. It's a real change, right?

Angie (08:41.198)

Yeah. Well, and we're always being challenged, I think, also by our clients. Like you say, that value, is it risk reduction? Are we charged by the hour? Are we reducing our time? Are we helping them see a greater return? But yeah, keep going because I'm very curious what else you're hearing on a broader scale as well.

Ross Griffiths (08:53.674)

Yeah.

Ross Griffiths (09:01.632)

Yeah, I I think on a broader scale, one thing that has got a lot of bandwidth in the markets is sustainability in the issue, right? And I know, you know...

If you're in certain places in the world, it's a language that maybe you don't want to say as much right now. And I think we'd need a, you know, we'd need a 24 hour podcast to cover what's going on in ESG. But I do think that generally clients are still really committed to ensuring environmental standards and resiliency remain high. Risk is reduced and there's a lot of ESG work still going on. It's just not really being talked about that much. I've heard some people who've referred to it as green hushing, but

it's not really so it's it's a really interesting market but I think clients have very little appetite to compromise on issues like contaminated land and PFAS and PM 2.5 and asbestos and water ecological degradation because it's just not worth it you know it's it's not worth it for for their brand it's not worth it for future risk so these underpinning drivers are still very strong and it's it's great to see

I think on that last point, and I think that plays well into the Inigen Alliance in many ways because I think I'm seeing the market really pivot to focusing on those EHS services. And I think that's really good to see. I think the Inigen Alliance is very well placed in that space. think the firms and organizations that you have in your alliance mean that you can deliver those services really

well. And it's actually the fastest growing service area that we have in our entire global market assessment with a five year compound annual growth rate of 7.4 percent. means in monetary terms that by 2029 there's going to be an additional 3.8 billion dollars a year being spent on EHS than there is currently. So there's a lot of market to aim for.

Angie (11:03.106)

That's always good news. you know, just coming back to your point about ESG and sustainability, and there's still a lot of effort being, you know, happening around those areas. We are finding it interesting in the United States. You know, I can, I guess, at least represent that with global clients where they're just being quieter. So I don't know that the hushing is green hushing as much as it is putting their heads down and doing the right thing, doing the responsible thing and still continuing on a longer vision than a shorter term.

response to the disruptions that are happening either in the United States or other places that could impact your ESG and sustainability efforts. So I see the vernacular changing more than the initiatives, which to me is positive. Obviously as somebody who believes we need to respond to climate change, we need to be doing the right things, that's good. Maybe it's sad we're not talking about it as robustly and publicly as we might like.

Ross Griffiths (11:44.937)

Yeah.

Ross Griffiths (11:56.827)

I do think that, yeah, we're going, just to go...

you know, ad lib a bit, but I do think that the noise around ESG did get a little bit too much because we actually went through an exercise here at Environmentalist. We brought a lot of industry actors together and we tried to define what ESG meant. And it became really difficult because the client saw ESG as one thing, the consultant saw it as another thing. Then you had the kind of whole ESG advisory, sustainability advisory services kind of became ESG as

Angie (12:07.266)

Yeah, yeah

Ross Griffiths (12:31.426)

well, no one knew what ESG was. And I think it was kind of inevitable that it would come under a lot of scrutiny, I think. So I think in many ways this scrutiny on it and the need to really hammer down to value creation for your clients is actually a good thing in the long run.

Angie (12:48.418)

Yeah, and one of the ways that we've responded and I say maybe just us as NTU-S but also globally is looking at our typical EHS services as part of ESG, know, helping companies tell the story and draw the lines between all the good things that you do around EHS and that is ESG or it is sustainability. There are ways to help, you know, move your mark with the things that you do every day. So, yeah, I think that complication is also why it got a little quieter, but we're still doing, I think, really good things, which is important.

Ross Griffiths (13:17.792)

And investors are still very keen on understanding the impacts of ESG on their assets, and ultimately it comes down to where the money goes.

Angie (13:18.352)

Okay.

Angie (13:28.428)

Yeah, for all of us, right? Like you say, it goes back to that value creation. So are you seeing regional trends? I mean, I can talk about the US and you can represent the UK probably. But I mean, what are you seeing regionally? Do you see that there is distinct differences in what's happening in our industry globally in different locations?

Ross Griffiths (13:47.274)

yes, I think that's fair to say. think,

I think if I was to look at sustainability as a theme, I do think in the UK and Europe, it still hasn't kind of faced the same levels of scrutiny, sustainability initiatives on the whole, that think they're being faced with maybe on the federal side in the US. So I think, you you've got a UK government that's very pro green initiatives, they want to invest in renewable energy. We've just had an announcement today that all new housing bill

and it's going to have solar panels and heat pumps. So, you know, we are still going for it on that front. And I think that reflects, you know, the position that we're in as a country. We don't have a lot of our own energy. The North Sea is a mature basin. And so we need renewables. We need to invest in those. But from Europe's point of view, I'm finding that more generally, and this includes the UK, the cost of living and the inflationary crisis are really

writing. I think all the regulatory drivers in Europe are there, albeit some of them are getting watered down slowly like CSID. But I think the regulatory drivers are there and they're still leading the world in terms of being the leading light on environmental policy. The problem is having the money to pay for some of these things. That's why the omnibus package came along, is there were concerns of what do we do to industry. So, mean, what are you seeing in the US, Angie?

Angie (15:22.306)

Yeah, you know, obviously our regulatory framework is not the driver right now. we really see regionally, I would say there's a polarization. You still have sort of the private sector still knowing that we need to go around renewables and especially, you know, even now we're feeling the crunch currently in the U.S. with rising oil prices. So that becomes very material then. And the response to that is, I think, starts pushing those agendas even further.

So, yeah, so the regulatory framework is not doing, you it's not the driver. It still goes back to that private industry seeing the long game. And then also feeling pressure, you know, many of these organizations have, you know, very large vested interests across the globe. So they're responding to the regulatory requirements, say out of the EU, whether it's, you know, related to CBAM or it's just related to CSRD. They're having to respond to that. And then a lot of times they're looking at doing that globally, saying, okay, if we're going to

Ross Griffiths (15:53.042)

Yeah.

Angie (16:22.536)

to put this in place just for the EU. We're going to do it globally because it's the strictest standard. And that allows us to be forward thinking. I think that maybe the good news is we're still influencing each other, both the good and the bad. But it's moving forward. And my impression is, like I said, that companies still want to do the right thing, not just for the environment or for climate change mitigation, but they want to do the right thing for the business, that it can survive the long term. yeah, it's an interesting, definitely an interesting

Ross Griffiths (16:27.488)

Hmm.

Angie (16:52.237)

time I would say and yeah.

Ross Griffiths (16:54.122)

definator.

I do think there are some kind of developing markets that are going maybe in some interesting directions too. think the Middle East for, know, there's been, you know, lot of conflicts in that region now for a while. And I think it was really, it was looking like a really exciting market in the way that it was developing with the Red Sea project. And you got Saudi Arabia's World Cup bid 2034 and Mazdar on the line and some really interesting projects that a lot of, you know, a lot of good was going to be done.

But I think the conflict there just meant that projects will find it really hard to push forward right now. So that's a bit of a problem for the industry, for those that have those businesses in the Middle East. I think Latin America, and particularly South America, has got some really interesting runway to come. We're seeing a lot of interest from particularly the European and the US consultants in looking at particularly areas like Brazil and Argentina.

again to get involved in those markets. I think one thing that's come out of the US administration is this kind of, I guess it's a kind of move back to the Monroe Doctrine. I know that there's been a, Donro Doctrine has been floating around as well, but I think it's clear that there's going to be a lot of emphasis on investing in South America and I think that's going to lead to energy extraction, minerals extraction, it's going to lead to lot of infrastructure investment. So I think that

That's quite an interesting market coming forward. And they're adapting their regulatory frameworks all the time as well and bringing them up to European standards. So it's an interesting market.

Angie (18:36.792)

Yeah.

Definitely. my next question was about, what do you see as sort of the fastest growing client sector globally? And it's funny, you bring up like Brazil, and I keep hearing about agriculture and sustainable agriculture and regenerative agriculture. And you think about a lot of the Latin American countries and there are going to be interesting industries that are highly impacted by environmental concerns, but yet have huge growth potential for those countries that are developing. So I can see that, but what are you seeing on a global basis?

Ross Griffiths (18:48.116)

Yeah.

Ross Griffiths (19:08.606)

I guess the obvious one is energy, energy and utilities in our market assessment.

The client sector that's forecasted to grow the most by 2029 is energy and utilities, by which we mean energy producers, electricity transmission, water and waste utilities. We forecasted by 2029 that market for environmental services to support those clients will be $7 billion greater than it currently is a year. So it's a huge market growth opportunity. It's data centers, it's AI capabilities, it's the need for new generation capacity.

investing grid infrastructure. There's some huge projects out there and just updating transmission networks. Even in the UK here, we have our great grid upgrade. It's a multi-billion pound asset management framework. It's huge. And then you've got water in the mix as well. And I think managing finite water resources is going to become a huge problem as we go into a heat stress world. But the second ranked client sector for growth actually is the services sector.

And I think that includes food and beverage, professional services, retail technology. I think we are in an era where the success of organizations is going to be determined by their ability to keep their costs down. And if that means bringing things in on site or shoring up the supply chains, making them more resilient, you mentioned agriculture, a chocolate manufacturer making sure that its supply of cocoa is secure for the next 20 years.

that are going to become extremely important as businesses adapt and I think that's why environmental consultants and any HHS providers around the world are going to be well placed to help them navigate those challenges, regardless of what's going on in the political world. This is a business problem, not a political issue. It's needed.

Angie (20:59.938)

Mm-hmm.

Angie (21:05.048)

Well, and when we talk about regional as well, if you think about supply chain, that vulnerability of being able to secure your supply chain, manage your scope three is challenging. And I know we talk with a lot of our associates that are in some of those countries that are exporting and it takes some sophistication to be able to meet the requirements of say an EU. And I agree, that's something that will continue to grow because some of those locations are the only places where the supply chain is gonna secure the product.

Ross Griffiths (21:26.368)

it.

Angie (21:35.092)

for whether you're talking about beer or chocolate, right?

Ross Griffiths (21:38.241)

And that must be really hard for those organizations in these developing nations because they might have their local set of compliance rules and then the European set which is miles apart. So it's exactly why companies like an organization like the UNIGINE alliance and then TAYR are needed.

Angie (21:46.871)

Right.

Angie (21:59.406)

All right. Do we miss anything to the team that's listening?

Angie (22:10.528)

rights. Great. I think it was great Ross. Thanks. mean it's okay. So I'm gonna thank you Ross and then I'm gonna close out. How about that? sound alright? Alright.

Ross Griffiths (22:19.122)

Okay, yep, that's all good.

Angie (22:22.306)

So Ross, fascinating conversation. As you know, always appreciate your insights, the research that you do as well, because I think that helps us in the industry kind of anticipate. We know what we see every day, but the data really helps us anticipate where we're going and think about the skill sets that we have and where we're located. So really appreciate it. And I'm sure our listeners appreciate it as well. So thank you for joining. Thanks so much. All right, I'm going to take a quick look at my notes for my closeout here.

Ross Griffiths (22:42.962)

You're welcome, Andy. Thanks for having me.

Ross Griffiths (23:05.024)

Sure.