Natixis to assess ESG in infrastructure investment
Natixis and research institute EDHECinfra, who have worked together for seven years, has launched a team to assess the impact of environmental, social and governance (ESG) factors on infrastructure investments.
The three-year project would document and produce a comprehensive analysis of ESG reporting standards and aim to provide a set of potential ESG impacts and risks. It would then create new datasets on ESG risks and their impact on infrastructure investment.
The two organisations hoped this would develop into an ‘infrastructure social acceptability index’ which would allow people to measure the economic impact of the climate risk exposure of infrastructure assets.
Although ESG was a growing consideration for firms, the organisations said, there were few holistic or systematic measures to help investors to track ESG outcomes.
Frederic Blanc-Brude, director of EDHECinfra, said: "Infrastructure investments have value because they are useful over long periods of time. Social and environmental factors significantly impact this long-term value, but today we do not know how or on what scale. We can build a new area of applied knowledge, combining existing datasets with new ones created using artificial intelligence, and drawing on the depth of knowledge on infrastructure assets and investment shared between EDHECinfra and Natixis."
"We want to determine what impact better-designed, more resilient infrastructure can have, both for the economy and for investors, focusing on first-order problems like climate risk and social acceptability over the life of these investments. Ultimately, the understanding of these issues will impact investors' selection criteria and the prudential treatment when investing in the asset class", explained Anne-Christine Champion, global head of real assets, corporate & investment banking at Natixis.
The two organisations had previously worked on research involving credit risk in private infrastructure debt.
AUTHOR
Laura Dew
Recommended for you
Ten Cap has announced it will launch its first active ETF on the ASX later this month, expanding retail access to its flagship Australian equities strategy.
Flows into cash and fixed income ETFs rose by 46 per cent in October with investors particularly demonstrating a preference for Australian credit ETFs as they move away from AT1 bank hybrids.
Having identified Australia as a growth market, J.P. Morgan Asset Management has collaborated with Betashares to offer two multi-asset managed portfolios on its Direct platform, the first funds on the platform from an external manager.
First Sentier has announced it will transition the Stewart Investors investment management responsibilities to its affiliate investment team in light of three senior portfolio manager exits.
