ETYMOLOGY

environment (n.) 

c. 1600, "state of being environed" (see environ + -ment); sense of "the aggregate of the conditions in which a person or thing lives" first recorded 1827 (used by Carlyle to render German Umgebung); specialized ecology sense first recorded 1956.

environ (v.) 

late 14c. (implied in environing), "to surround, encircle, encompass," from Old French environer "to surround, enclose, encircle," from environ "round about," from en- "in" + viron "a circle, circuit," also used as an adverb, from virer "to turn" (see veer). Related: Environed.

-ment 

suffix forming nouns, originally from French and representing Latin -mentum, which was added to verb stems sometimes to represent the result or product of the action. French inserts an -e- between the verbal root and the suffix (as in commenc-e-ment from commenc-er; with verbs in ir, -i- is inserted instead (as in sent-i-ment from sentir). Used with English verb stems from 16c. (for example merriment, which also illustrates the habit of turning -y to -i- before this suffix).

setting (n.) 

late 14c., "fact or action of setting (something), putting, placing, planting," verbal noun from set (v.). 
Meaning "place, location, site" is late 14c. Surgical sense, with reference to broken bones, etc., is from early 15c. In reference to heavenly bodies, from c. 1400. Also in Middle English "act of creation; thing created" (c. 1400). In reference to mounts for jewels, etc. from 1815; meaning "background, history, environment" is attested from 1841.

set (v.) 

Old English settan (transitive) "cause to sit, put in some place, fix firmly; build, found; appoint, assign," from Proto-Germanic *(bi)satjan "to cause to sit, set" (cognates: Old Norsesetja, Swedish sätta, Old Saxon settian, Old Frisian setta, Dutch zetten, German setzen, Gothic satjan), causative form of PIE *sod-, variant of *sed- (1) "to sit" (see sit (v.)). Also see set (n.2). 

Intransitive sense from c. 1200, "be seated." Used in many disparate senses by Middle English; sense of "make or cause to do, act, or be; start" and that of "mount a gemstone" attested by mid-13c. Confused with sit since early 14c. Of the sun, moon, etc., "to go down," recorded from c. 1300, perhaps from similar use of the cognates in Scandinavian languages. To set (something) on "incite to attack" (c. 1300) originally was in reference to hounds and game.

Online Etymology Dictionary