WSP Acquires Climate Financial Advisors In Competitive Market For Climate Service Offerings

WSP Acquires Climate Financial Advisors In Competitive Market For Climate Service Offerings

On February 14, 2022, WSP, an engineering and professional services firm with 55,000 employees globally, announced that it acquired Climate Finance Advisors (CFA) to enhance its climate change capabilities and offerings and strengthen its market leadership in end-to-end climate finance and environmental services. CFA will become part of WSP USA’s Climate, Resilience, and Sustainability (CRS) team.

Headquartered in Washington, D.C., CFA is a relatively small consultancy focused on climate finance and blended finance, with clients located worldwide, including the United Nations, multilateral development banks, development finance institutions, philanthropic impact investors, and finance ministries. CFA also manages the European Union (EU)-U.S. Climate Alliance (USCA) Climate Risk and Resilience Corporation project, a collaboration among the EU, EU member states, and the USCA. CFA helps its clients manage climate-related risk, capture climate investment opportunities, and incorporate climate considerations into investment decisions.

The CFA acquisition is the latest in a series of acquisitions by WSP, including LT Environmental (2020), EarthCon (2021), and Golder (2021). The acquisition aligns with WSP’s cradle-to-cradle approach to engage with clients across the entire life cycle of a project, as described in the Verdantix Green Quadrant: ESG & Sustainability Consulting 2022 report.

This timely acquisition also highlights growing interest from corporates, investors, government agencies, and other organizations to evaluate and address climate-related financial and operational risks and opportunities. The Verdantix 2021 ESG Global Corporate Survey report found that climate change policy development is the most significant driver for increasing corporate engagement with sustainability issues in the last 12 months, in part due to the rise of mandatory Task Force on Climate-related Financial Disclosures (TCFD) reporting in New Zealand and the United Kingdom, as well as the EU’s unveiling of comprehensive climate change proposals aimed at achieving carbon neutrality by 2050.

In addition to TCFD reporting requirements, corporates are increasingly demanding climate-related services to help with investment and strategic decision making and risk management, and to answer questions posed by other stakeholders. As noted in the Green Quadrant: ESG and Sustainability Consulting 2022 report, several other consultancies are increasing their offerings related to climate risk. Acquisition is one way for consultancies to compete in this space, and we are seeing a talent war to meet these demands. With the acquisition of CFA, WSP will be able to apply a finance lens to its projects and offerings, differentiating WSP from some of its competitors.