A Neutered EPA: Smaller Staff, Smaller Protections

A Neutered EPA: Smaller Staff, Smaller Protections

Recent developments under the anti-environment-postured Trump administration have raised eyebrows among corporate leaders, environmental professionals and software vendors. In a series of policy directives, a White House memorandum in late February directed the Environmental Protection Agency (EPA) to prepare for substantial layoffs, with the President announcing a 65% reduction in its total personnel. The administration later clarified that the announcement, typical of its whirlwind style, actually meant a 65% overall budget cut.

The potential impact
The EPA – founded on December 2, 1970 – is responsible for protecting human health and the environment by developing and enforcing regulations, awarding grants, studying environmental issues, sponsoring partnerships, educating people about the environment and publishing information. The organization has strived to ensure that Americans have clean air, land and water, alongside countless other elements of today’s reality.

Such a significant funding cut will see the EPA’s ability to enforce environmental regulations, execute inspections, issue permits, and support state and local environmental programmes greatly reduced. The defunding will curtail the agency's power to maintain air and water quality standards, and control hazardous waste and chemical pollution; given enough time, this could lead to 1970s pollution levels.

The Verdantix view
While the long-term implications may hold serious consequences, shifting our view to corporate reactions and the impact on environmental compliance software vendors reveals a potentially different situation.

Tracking permits, emissions, water and waste have become standard processes in corporate operations. While some firms are still making the shift from pen and paper to software-based workflows, understanding and complying with NPDES permits – for example – is a fact of life. Organizations have invested millions of dollars and workforce hours into setting up their infrastructure to limit pollution, track and model emissions, and properly deal with hazardous waste. So much so that enterprise firms will most likely continue to maintain their operations to align with permits, even if they are no longer issued or enforced. They have already spent the time and money to do so – and otherwise risk, if at a certain size or breadth of geographic region, being held accountable by state or international frameworks.

However, smaller firms, say those in the mid-market or those just moving from pen and paper to Excel, may decide that the cost of implementing software and infrastructure systems outweigh the cost of just discharging their waste. These organizations may not recognize the advantages of systems designed to ensure compliance with regulations that might become obsolete, or irrelevant to anyone, if fully eliminated.

The outcome
What does this mean for software vendors who cover ESG, or the E of EHS? An overall reduction of purchasers of this software within the US, but primarily at the bottom end of the purchasing pool. A shift in how vendors present the ROI narrative to firms, moving away from regulatory compliance driven adherence to a more corporate-led reputation and CSR focused lens. Software providers will have to refocus their efforts on geographies that still uphold sensible environmental protections, while dropping all but the enterprise level end users within the US.