A group of institutional infrastructure investors have partnered with GRESB to launch GRESB Infrastructure – a new global sustainability benchmark for infrastructure assets. The group of investors, representing US1.5 trillion in assets, set up the initiative so a consistent global sustainability framework could be developed for the sector, to allow more capital to be streamed into this type of infrastructure, and its increase sustainability. GRESB is an industry organisation that assesses the sustainability performance of real assets globally, and has over 150 members. Their role is to optimise the risk/return profile of investments, with this benchmark another method of achieving this end.
Governments are increasingly turning to the private sector for funding in infrastructure investments, making it attractive to investors. Infrastructure is more commonly being used as a vital element in diversification strategies, particularly the long-term variety, with 28 per cent of pension funds now investing in this asset class, despite allocations remaining low (according to the GRESB statement, less than one per cent). This is expected to increase in the coming years, since sustainability and infrastructure are such intimate bedfellows, and transportation, energy, water, and waste management are such vital elements of our societies. The new benchmark offers investors assessments and processes that allow evaluation of the sustainability performance of their investments, with the framework allowing the collection and comparison of key environmental, social and governance (ESG) metrics, increasingly important in all investment arenas.
The first GRESB Infrastructure assessments under this newly-imposed framework are due in early 2016.