Inside Business: Their mission is to stop firms choking

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The Independent Online
Banks and other advisers are clear beneficiaries of the mergers and acquisitions boom. But a less obvious winner is a firm called Environmental Resources Management. With companies increasingly conscious of potential pollution and other environment-related liabilities, the due-diligence exercises associated with transactions now typically involve investigations of this sort.

As a result, ERM staff are frequently sent to locations all over the world to evaluate the risks and to recommend the appropriate courses of action, explains Eric Turner, the firm's UK managing director.

However, this is not the only factor behind the growth of an organisation that has seen revenues rise 10 per cent in the past year, to about pounds 17m. Mr Turner points out that it is also benefiting from companies' recent tendency to cut back on staff and outsource much of the work they regard as peripheral to their main activities. At the same time, the trend for establishing strategic partnerships born of corporate desire for continuity sees ERM becoming one of the two to three chosen suppliers selected by worldwide organisations such as Coca-Cola and General Electric of the United States.

But the most important driver of the firm's growth has been the increasing prominence and breadth of environmental concerns. While he and his colleagues argue that it is right for the issue to have slipped from being the number one business concern that it was at the height of its trendiness a few years ago, they also stress that the field has moved a long way from being confined to pollution of rivers and the like. "It's hard to see a business activity that doesn't involve what we do," says Mr Turner.

And because of the constant overlap between its environmental assignments and work that involves economics or health and safety, it is increasingly inclined to see itself as more of a mainstream management consultancy, albeit with special expertise.

It is, for example, working on a project for London Transport looking at greater integration of public transport in the capital, while it has established a separate consultancy called Four Elements to examine health and safety issues. Meanwhile, its bread-and-butter work of carrying out environmental impact studies in the developed and developing worlds alike is continuing to grow.

Whether the project is a building on a greenfield site in Britain or an ambitious road across a remote desert, ERM is likely to be there. It is also picking up work verifying the environmental reports that increasing numbers of companies are starting to publish as complements to their annual reports and accounts.

Established in Philadelphia in 1977, ERM joined with Environmental Resources Limited, the UK consultancy, a decade later and now has 2,500 staff spread over most parts of the world. This puts it in a strong position to gain from the opportunities arising from the opening up of new markets.

For example, it is very active in India and other parts of Asia as well as Latin America and central and eastern Europe. In particular, the continuing popularity of privatisation around the world is creating a role for the consultancy to work alongside aid agencies in countries such as Chile and Turkey and investigate the public-health aspects of mining or oil and gas operations before investors are committed.

And, in a neat twist, some of its expertise is being transferred to the City, where the Corporation, for one, is seeking to raise awareness among the financial community of the risks associated with environmental matters.

It is all part of what the firm calls "integrated risk assessment". According to Mr Turner, this involves helping large companies in particular to prioritise risks and make them part of the business. "Often, [environmental] audits only look at small things. They don't anticipate Bhopal-type events because they are not within the scope," he adds.