Verdantix Forecasts Impact Of Increasing Corporate Budgets On EHS Services Market

Verdantix Forecasts Impact Of Increasing Corporate Budgets On EHS Services Market

The last five years have seen a notable evolution in the priorities and expectations of the corporate EHS function. A plethora of drivers contributed to this change, primarily a change in working perspectives after the pandemic, a diverse and fast-moving EHS tech industry, and the need to pivot to address pressure from regulators and investors to improve ESG disclosures.

A recent Verdantix survey indicated that EHS leaders have been tasked with diversifying their internal skillset, with expectations for professionals in the field to have a level of technical proficiency, maintain an intricate understanding of operations and keep up-to-date with the ESG regulatory landscape. This flux has provided both headaches for EHS leaders and an opportunity for the EHS function: the chance to become more integrated within the business and grow its influence within a corporate infrastructure.

Corporate budget holders understand the new strains imposed on the EHS function and have turned to service providers for support. A recent Verdantix survey revealed a wholesale increase in consulting and services budgets among a sample of 300 EHS leaders. This growth is highlighted in the latest update to the Verdantix EHS Services Market Size And Forecast report, which modelled the current market, worth $42 billion, to expand at a CAGR of 7.4% between 2022 and 2028, reaching $62 billion by 2028.

The market size and forecast study is a multifaceted methodology, factoring in disclosed and estimated revenues of 90 of the largest EHS service providers, penetration rates reflecting identified trends in the market, insights from interviews with leading executives in EHS service firms, and a host of macroeconomic and EHS-specific drivers. The report breaks down the current EHS service market spend by 14 service lines, 25 industries and 11 regions, in addition to giving year-on-year forecasts between 2022 and 2026.

The current market is dominated by large-scale environmental field services, such as water management, impact assessments and site remediation, which account for over 80% of total EHS service spending. Naturally, spending is concentrated on heavy industrial verticals with large environmental footprints, namely oil and gas, mining and metals, and utilities.

The growth rate of the EHS services market has surpassed that seen prior to the pandemic and has remained resilient despite a slowing of the global economy. Corporate ESG & sustainability consulting, a service line that sits adjacent but also closely integrated with more traditional EHS offerings, is witnessing the greatest growth (16.6% CAGR). Strict regulatory pressures, notably those implemented in Europe and APAC, have prompted an increasing spend on EHS services support.

To get a more granular view of the EHS services market spend, read the recent Verdantix report Market Size And Forecast: EHS Services 2022-2028 (Global). For wider insight into EHS and ESG, visit the Verdantix website here.