Natixis and EDHECinfra have formed a three-year research chair to evaluate the impact and risk profile of social and environmental factors on infrastructure investments.
Directed by the same team that created an unlisted infrastructure indexing platform, the research chair will aim to produce a comprehensive, compact analysis of ESG reporting standards. It will take the perspective of infrastructure companies and aim to provide an exhaustive set of potential ESG impacts and risks.
“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,” said Anne-Christine Champion, global head of real assets, corporate & investment banking at Natixis. “Ultimately, the understanding of these issues will impact investors’ selection criteria and the prudential treatment when investing in the asset class.”
Next, the team will create new datasets on ESG risks and their impacts in infrastructure investments using machine learning. The ultimate goal is to develop an infrastructure social acceptability index, along with measures of economic impact and of the climate risk exposure index of infrastructure assets.
“Infrastructure investments have value because they are useful over long periods of time,” said Frederic Blanc-Brude, director of EDHECinfra. “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.”
