RegulationCorporate GovernanceProfile: Nick Pulford, CFO at WSP Environmental

Profile: Nick Pulford, CFO at WSP Environmental

Construction is feeling the crunch more than most, but WSP Environmental’s CFO Nick Pulford is confident its green and sustainability work will see it flourish

Nick Pulford, WSP Environmental's CFO

Nick Pulford, WSP Environmental’s CFO

Even when your business is designing buildings and sustainability
infrastructure, moving office is still a pain in the proverbial.

At least for WSP Environmental’s global CFO Nick Pulford, the group’s experts
created a ‘lovely space’ on the corner of Chancery Lane and High Holborn.

‘We’d been in old buildings for over 12 years, the lease expired and the
landlord wanted to do a complete refurb. It was an expensive move, not just in
terms of financial cost but disruption, plus designing and new fit out,’ says

‘We did a lot of the interior work but that takes us away from earning
ourselves, but credit to our business services team – it’s done to as good a
standard as we could achieve.’

It’s unlikely that WSP’s teams struggled too much on the 57,000 square foot
site, as the FTSE 250 group is working on some of the biggest construction and
sustainability projects in the world at the moment.

From helping clear up the East End sites for the 2012 Olympics, to work for
the Shard at London Bridge or the Freedom Tower in New York, it’s very busy

Just posting £755m in revenues for 2008, with profits climbing 43% to £58m
the group is ticking along very nicely indeed.

Green king

But CIMA-qualified Pulford’s business is focused on the environment and
energy services division of the group, which accounts for 13% of the group’s
revenues ­ £92m.

And it could well be argued that its services have the most potential for
future growth, as the market for sustainability services around new and old
builds is only heading upwards.

Environmental and energy services, or ‘E&E’ as Pulford describes the
division, is structured as a global business, but WSP’s other service lines of
building design, infrastructure and management & systems are country-based

‘A property developer in the UK doesn’t tend to develop properties overseas,
there’s regional procurement, and the same goes for road and rail. But E&E
is run as global ­ people work in different territories and our systems are
aligned differently.’

The division’s main offerings are urban regeneration, site remediation ­
cleaning up from past uses ­ and running environmental impact assessments. This
included serving as one of the main contractors for monitoring and remediation
work at the East End site for the Olympics.

With high-profile work, and the growing awareness of climate change issues,
businesses are dealing with sustainability as a major part of keeping up with
best practice in corporate social responsibility terms.

‘People are looking at what they need to do to readjust their business for
what will, hopefully, be a low-carbon world going forward. It will be those who
adapt quicker that may face some short-term pain but, in the long run, will be
much better placed to take advantage.’

Commitment to the cause

Issues that businesses might look to take advantage of include reducing their
reliance on fossil fuels, reducing their energy bills and meeting the
requirements of the Carbon Reduction Commitment, which will see the UK’s largest
public and private sector organisations enter a carbon emissions trading scheme
from 2010 onwards.

‘Fuel will continue to be an expensive resource, so if you can use much less
of it in whatever form it takes ­ make buildings and cars more efficient, go
smart working, develop the infrastructure ­ you can take advantage.’

But, as Pulford admits, consultancy spend is discretionary, with discretion
very much in order during the trough of an economic cycle. ‘One of our
challenges is to say to clients that this spend will give you payback. On the
face of it might like look like a bill, but payback will be quick.’

Every property must now have an energy performance certification (EPC), which
effectively gives an energy efficiency rating similar to that on the side of a
dishwasher or washing machine, but beyond that work E&E tries to sell
value-added services.

‘The client says “do me an EPC” and it’s x pounds to do that. But if you take
on the next stage of advice from us we can do energy-saving measures, so when
you [improve] that property for a new tenant/business it might move up to an

‘We’re all accustomed to seeing a dishwasher in a shop, and looking at the
ratings. Tenants will choose just A-rated properties, so [there will be] quick
turnover for the property owner by moving it from a B to an A ­ that’s the way
we feel we can add value.’

Best of breed

E&E is advising clients on what the government is likely to audit on CRCs
(see box), and the mention of the word ‘audit’ inevitably sees it line up
against the Big Four in the environmental stakes.

‘They will certainly add that to their portfolio,’ says Pulford, so E&E
is positioning itself as best of breed.

While standard audit work for accountancy firms will become ‘commoditised’,
according to Pulford, the Big Four will leverage their board contacts to offer
their services around the environment and sustainability.
‘They’re using their brand ­ we’re using our intellectual capital,’ he says.

‘If you want a big brand then that’s fine, those boys are well known in the
market but, for us, the delivery is key. I’m not saying they don’t deliver, but
we have got world leaders in sustainability and climate change that potentially
they don’t have. That’s the difference.’

Since joining the business in 2005, Pulford has attempted to bring E&E’s
finance function into the 21st century, which includes the rare situation of its
team getting involved in helping out on commercial deals with its clients.

‘Our finance function is very much aligned to the business operations,’ he
says. ‘We don’t sit away from everyone.’

Finance is much more business-oriented and commercial: ‘The grey-suit type pe
rson still has a place but, in a fast-moving client environment like ours,
that’s probably not the right person. We have a very dynamic market place.’

Local focus

The division has its own finance department, separate from the group. Pulford
and a group FC manage global finance. Manchester hosts its UK finance team,
while teams in Sweden, the US and Australia crunch numbers. The Middle East and
South Africa will run as one region ­ Pulford is looking to recruit an FC
alongside a couple of junior members of the team.

Outside of the division, WSP follows its local focus with local finance
teams, plus a small group function to manage tax and consolidation.

Group FD Malcom Paul has signed off on Pulford’s big job for 2009 ­
implementing its own management, sales and finance system for the division.

Deltek Vision is the product that’s used by 76% of the top 500 architecture
and engineering firms.
And just to complicate matters, the group as a whole has put together a system
so that clients can be targeted much better for cross-selling. ‘Let’s talk to
them about the broader services,’ says Pulford.

‘Changing the back-end has been good but we need to steer the front-end ­ the
CRM, commercial delivery, that’s the huge reason for doing this project. When
the markets come back I want us to be at the forefront and really accelerate out
of this environment ­ that’s the challenge.’

Green standards

As WSP Environmental can testify, it is not just the West that can see the
ethical and business benefits in reducing the effects of climate change. E&
E has been involved in global consultations to not only determine where
reductions can be made, but write legislation for future companies and

‘A few years ago E&E wrote the green standards for the Saudi gove
rnment,’ says Pulford. ‘We were engaged by the Saudi government to write their
legislation which was a two year project.’

He dismissed concerns that a company advising on legislation and then
designing buildings for clients on the legislation was conflicted.

‘There is an opportunity for us to help property developers or corporates and
say “we’re engaged in writing this” so we can help you comply with what the
standards are likely to be,’ says Pulford.

‘We can advise on what the standards should be, for that market and best
practice. But it is up to the government to decide what goes in. It’s their
call, we’re not conflicted.’

Although Pulford believes building project work may be slowing down, E&E
has been kept busy. It was recently asked to write the green building code in
Dubai, with the ruler of the emirate state asking WSP to write his green
‘masterplan’. Not only that, Dubai is hoping to create the worlds first zero
waste, zero carbon district, Masdar City, which E&E is currently consulting

‘We’re engaged on a project in Abu Dhabi… on the whole sustainability design
­ what it should look like, how people will get around, air, water, all those
real front end services,’ says Pulford.

Carbon cost-cutting

As the latest environmental legislation ­ the Carbon Reduction Commitment ­
hits the UK, companies could be forgiven for thinking it’s an extra cost at a
time when cost reduction is vital. But for Pulford the introduction of carbon
controls brings unique added revenues by auditing emissions.

‘One of the things that haven’t been defined is how the audit will take
place. We’re advising clients how to comply with legislation, so as long as
there isn’t a conflict that you’re an auditor and adviser, we have the skills
in-house to do those things to say “what you need to do is this”.’

The CRC, which begins this year, requires all companies that spend approxi
mately £500,000 or more annually on its energy bills to pay for its predicted
carbon usage.

The companies are placed in a league table which will determine the amount of
rebate the following year.
For example, a company would pay for its predicted carbon usage and the
following year receives rebate on the amount they had not used ­ but the full
amount of rebate will be determined by its ranking in the league table.

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