I recently encountered a command line tool which exposed passwords in the process listing.

The command would also also accept a password as an environment variable. I was concerned with the security of storing a password in an environment variable.

This article at itworld.com does a nice job explaining environment variable scope.

Environment variables are only accessible in the shell in which they are set.

If you export the variable, it is accessible to any subshell of the shell in which it is exported. Simply logging in as another user on the system or even the same user does not allow access to the exported variable.

So, until someone corrects me, I believe that setting and exporting environment variables containing passwords in a script does protect the password from exposure. As soon as the command requiring the password has completed, the variable can be reset to an empty string to prevent any further access to the password.