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Context

The environmental services sub-sector includes private entities involved in domestic and hazardous waste management, contaminated site remediation, water and wastewater treatment, air pollution technologies and other aspects of pollution control and environmental management. Canada’s leadership position in the development and administration of environmental regulations by all levels of government has contributed to the creation of a vibrant, world-class environmental services industry that is a major player in the implementation of projects designed to comply with those regulations. Serving both business and public sector needs for environmental management, firms in this sub-sector have developed not only the technologies to address the environmental management challenges of their clients, but also the awareness to develop and operate projects in an approval environment that includes a high degree of public involvement.

Drivers

The environmental services industry is driven by three forces … economic activity, corporate policy/shareholder/citizen expectations and public sector regulation. While initially the product of increasingly strict environmental regulations related to water, land and air pollution, the industry is increasingly influenced by the level of business activity and domestic consumption in Canada. Added to that is the greatly increased level of accountability expected from publicly traded corporations to account for and properly manage their environmental liabilities and risks. Governments are also increasingly influenced by similar stakeholder pressures in areas such as waste management, water supply and air quality, creating the demand for technical solutions that are leading-edge. And these expectations often transcend national boundaries. The Canadian environmental services industry is increasing being called upon to deliver technical and management solutions to environmental problems internationally. We are a nation noted for its clean environment. Our businesses in that sub-sector are understandably being called upon to transfer that technology to the world community.

Outlook

Domestic investments in environmental management are growing at a rapid pace. Governments have been caught out with respect to assured water quality expectations post-Walkerton. Municipal waste management programs are becoming increasingly sophisticated in their technology and management. The health of the resource sector has led to expectations and requirements that we can have both a healthy economy and a healthy environment. International agreements such as Kyoto have placed an imperative on business and government to exceed previous standards of what constitutes appropriate environmental management. And vehicles such as Sarbanes-Oxlely have increased the visibility of corporate attention to their environmental exposure. All of this points to increased levels of activity in the environmental services industry. Even in times of economic slowdown, the industry is expected to be stable. Added to that is the tremendous opportunity for international activity from a sector of the Canadian economy that can stand toe-to-toe with any in the world.

Changing Client Needs

The initial stage of adaptation to changing needs by both public and private sector organizations was to develop in-house resources to deal with both the technical and regulatory aspects for environmental management services. The increasing complexity of the business has resulted in greater reliance on private sector partners, not only for program management and design, but also for the delivery of specific environmental services such as municipal waste management. Today, the business is truly a partnership, with both public and private sector “owners” of environmental liabilities turning to private sector environmental service organizations to provide that service to their organization. But outsourcing environmental management services is not as simple as outsourcing other business services ... the exposure and stakeholder accountability for performance are high consequence issues for these organizations. Therefore, outsourcing arrangements require a high degree of owner involvement in the design and delivery of these services ... the service may be delivered by third parties, but the liability and accountability remain with the owner.

Dillon clearly understands these issues, and provides its technical and managerial solutions with a full understanding of the importance of effective environmental management to the success of clients. We work closely with environmental service providers to bring this understanding to bear in the design and delivery of appropriate solutions to clients.