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Exactly why did ERM buy out Kathy Jones and Associates?

David Snashall ERM Consulting
David Snashall ERM Consulting

Global sustainability consultancy ERM has 5000 staff worldwide and is one of the leaders in helping governments privatise assets. So why did it need to recently buy Kathy Jones and Associates, a Sydney based company with around 70 people?

ERM is on a strong growth trajectory with more than 5000 staff now on its books globally. The company’s Asia Pacific senior partner David Snashall says the growth has been largely thanks to coal power plant closures, the infrastructure boom in Australia’s major cities, and the clean energy transition.

But even so, the company needed another skill set.

According to Snashall, both the private and public sectors are becoming increasingly attuned to the importance of involving the community and maintaining a “social license to operate”. And that’s why the company recently acquired Kathy Jones and Associates (KJA), a stakeholder engagement and communication consultancy with offices in Sydney and Melbourne.

KJA’s specialities, particularly for major infrastructure and urban regeneration projects, were seen as important for the company’s plans to keep growing its presence in Australia and the pacific region.

Among ERM’s emerging service areas, most require some level of stakeholder engagement: major operations such as coal fire power stations and mines, involving demanding work to clean up sites and deal with contamination post-closure; the clean energy transition, including in pumped hydro. He said that along with the well-publicised projects such as Snowy 2.0, there’s “a lot of other people dabbling in smaller [pumped hydro] schemes” in the eastern states.

Big projects that the firm is involved in include the rehabilitation of the Hazelwood site in Victoria. The company also supports the Department of Defence nationally with a range of services including heritage and contaminated site management.

In the infrastructure sector, there is a growing demand for multiple different streams of work, including safety and air quality.

Stakeholder engagement has always been important in environmental consulting

According to Snashall, stakeholder engagement has always been a priority “to some extent” in his line of work. Back in the 90s and 80s, it was known as “community engagement”, and since then, has “dropped off and come back again” in importance.

And engaging the community has nearly always been a critical component of major government projects. What’s different now, he says, is that private companies are increasingly on the front foot on many sustainability issues.

In the past, companies did what they had to because it was a legal requirement. Now they’re addressing environmental and sustainability concerns because they think it’s “the right way to run a business”.

Snashall has also observed that investors and financial institutions are placing greater emphasis on environmental impacts.

Companies are not waiting for governments to make the rules

Snashall expects to see more of this leadership from the private sector going forward.

“We are seeing companies thinking more strategically about how they organise themselves around sustainability.”

Although not sure if he’d call these big companies “leaders or laggards”, it’s clear they are not waiting for government to make the rules before making changes.

“And these workforces are so large that they can really make a change. When a big business says they are going to use all renewable power, it makes space in the market to use more renewables.

“Businesses can and are driving sustainability,” he added.

He said this will only continue as these companies start “pushing the boundaries of going carbon neutral.”

Technology will also shape the industry going forward. Increasing automation in mining, for example, is going to shift the social and economic dynamic of the industry.

ERM’s journey in Australia

Headquartered in London, the company has been around for 40 years and employs more than 5000 people in 160 offices in over 40 countries.

The company established a presence in Australia in 1994 when it acquired an Australian environmental consultancy firm where Snashall was working at the time.

“I’ve stayed for 30 years. I’ve been in sustainability for that whole time.”

The company focuses a lot on environmental due diligence in assisting government to privatise assets, and has worked on the ports of Darwin, Melbourne, Newcastle, Botany and Kembla, as well as electricity assets in NSW and most recently, the Westconnex motorway in Sydney.

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