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Mott MacDonald has experienced a remarkable few years. Its business doubled between 2005 and 2009, and their international work has grown from 40% to 65% of the business. As recent events have shown, some foreign markets throw up difficult conditions at short notice.
The Middle East
“I’ve not known it quite as intense as it has been in the last few weeks. We’ve seen emergencies of different kinds across the world,” explained Keith Howells.
“In Libya we managed to extract all of our staff. We got them out on the Monday and everything went wrong on the Tuesday, so that was a little good luck.
“We know that Bahrain is a problem area right now. We have just shut our office as demonstrations are ongoing amid news of Saudi troops moving in.
“This is part of expanding abroad. We’ve progressively moved over five years from 60% domestic work and 40% international to 35% domestic and 65% international. But that means we have to think carefully about how much risk we want to take in any one territory. There are political risks, but also economic risks such as the difficulties in Dubai.”
There can be a lot of outside help needed to ensure the security of staff operating around the world, and Keith Howells is happy to draw on that support and advice.
“We don’t claim to be experts on security. We seek advice from firms who specialise in that sort of work. Staff security is something we take very seriously, not just in high risk countries but all around the world. People have to be properly briefed about any instability or risk of crime.
“We do work in Afghanistan under the control of the Foreign and Commonwealth Office. So we don’t take these things lightly, and in Iraq we seek protection from private security companies.”
Growing abroad
Despite this, Mott MacDonald is unlikely to turn away from growing overseas. Keith Howells sees a number of markets abroad where growth will continue.
“India has the three majors drivers of activity. They have high economic growth, high population growth, and rapid urbanisation.
“To put that in context, they are looking to spend a trillion dollars on infrastructure in the next five years, around half of which will be done through the private sector. That spending will include installation of energy capacity akin to 125% of the UK’s total current capacity.”
This is not to say that established markets are off the agenda.
“The USA will remain a major market, and Australia and Canada are both looking to grow their infrastructure in the years ahead.
“We are doing some exciting stuff in Canada. We were the lead designer for the award winning Sea-to-Sky Highway Improvement Project for the 2010 Vancouver Winter Olympics. We have also won a similar urban highway job in Vancouver, and another in Ontario, so Canada is exciting for us at the moment.”
However, political and economic risks are only part of the story. The environment still has the power to shock too.
“We spent half of Friday [the day Japan was hit by the earthquake] on the phone speaking to our people in the Far East. Our employees there are OK, and although we were concerned about the potential tsunami beyond the local area, that didn’t get too bad.”
Energy
The situation in Japan has had consequences across the world. Energy policy is likely to be revisited in major nuclear countries as they announce measures to ensure their plants are safe and reassure their public.
Keith Howells sees a risk of the low carbon agenda being affected.
“The low carbon agenda gives industry a lot of food for thought. How do we move fast enough? How do we tackle our existing building stock?
“Moving to cleaner energy will be a challenge, especially if what has happened in Japan leads people to question the case for nuclear new build. We have planned for the UK to have nuclear in the mix. If it isn’t, then what do we do instead?”
Mott MacDonald does not build reactors, but Keith Howells is clear that the civil engineering sector is crucial to making nuclear safe and profitable.
“The reactors are perhaps 40% of the total work. Much of the work is other power engineering and civil engineering. It is substations, roads, ports and everything surrounding the process of making a nuclear island. For example, in Abu Dhabi we are designing sea water cooling intakes for the nuclear industry. ”
Keith Howells is also ambitious for the energy sector more widely.
“The UK needs to move a lot quicker than it is moving at present. I don’t think the lights will go out, but I can see there being another dash for gas to fill the generation gap when older power stations reach the end of their lives. That might be justified alongside a view that we should create standby for wind power.”
Keith Howells sees a range of energy questions ahead for the UK.
“There is a lot of talk of carbon capture and storage but that remains an unproven technology. If it doesn’t work out we need further options. It will also be interesting to see how wind develops and how we deal with its intermittency.
“There is also a question of generating capacity as more cars run off electricity. Transport is a big component of the energy balance and shifting a relatively small proportion of that to electricity will have a big impact on generation needs.
“If there is a significant innovation it may happen with smart grids and how we distribute power generation and use. We are moving from an era when generation happened a long way away from where it was used to a situation where generation - large and small - is happening all over.”
Large Consultancy Group
Keith Howells wants his industry to play a big part in answering these questions. With that in mind we turned to the ACE Large Consultancy Group (LCG) and his ambitions as chairman.
“Our industry has struggled in the past to get its voice heard by government. But that can change and it is changing. The new government is in listening mode and so we need a precise and clear set of messages,” he explained.
“Most of the large consultants join the ACE for advocacy so I’d like to use the LCG as a means for collecting those common industry positions on issues. We can then use ACE to articulate that to government, stakeholders and client organisations.
“This should be the collective vehicle for expressing the views of our industry and hopefully achieving some change. There is little value in me just expressing my views alone. We need to express the industry view together.
“It can be hard to get the ear of government and other bodies, so when we do get their ear we need to articulate very clear messages. Our industry has not always done that very well. So our focus groups will help to achieve that, and if we can use those to capture opinions and concerns then that can serve as a step forward.”
And what is the message Keith Howells wants made most clearly?
“It is all about infrastructure. People know that infrastructure is generally not in a good enough state in the UK. It is especially acute in transport. We have got to look at roads in particular. We know that 93% of passenger kilometres are on the roads, while only 7% is on the railways. So we need investment that reflects that. We also need to move faster on energy and create an environment that will give the private sector the confidence it needs to invest in our power infrastructure.”
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