Investment process

It is part of the DNA of our business that a sustainability-led mindset is essential to delivering long-term success. This mindset has directed our assessment and management of the Environmental, Social and Governance (“ESG”) aspects of our business.

InfraRed maintains a comprehensive sustainability management system which integrates sustainability into each stage of the investment process – from the initial assessment of an investment opportunity and the ongoing management of our portfolio, through to divestment, hand back or decommissioning of an asset.

We take an active approach to long-term sustainable investment which is based on a foundation of robust ESG principles. We use environmental criteria to assess how effectively a company stewards the natural environment, assists with the transition to a low carbon economy and complies with relevant laws and regulations. Through a social set of standards, we evaluate the company’s approach to health & safety, labour standards and working conditions as well as the relationships it has with its stakeholders and surrounding communities. In terms of corporate governance, we look to ensure that our portfolio companies and partners adhere to the highest standards of corporate conduct. We undertake regular studies, inspections, surveys and risk assessment to ensure this remains the case at all times.

Our processes are reviewed and refreshed periodically as part of our commitment to continuous improvement.

Sustainable Reporting

InfraRed recognises the importance of regular and transparent reporting. Sustainability reporting promotes better risk management, operational efficiency and ensures that we are accountable to stakeholders. 

InfraRed is also a supporter of the Task Force on Climate-related Financial Disclosures (“TCFD”), confirming its commitment to acting on climate change through consistent climate-related financial disclosures.

HICL and TRIG, the listed investment companies that InfraRed manages, began voluntarily reporting against the TCFD recommendations in their Annual Reports in 2020, which can be accessed via their websites.

Disclosures in accordance with Regulation (EU) 2019/2088 Sustainable Finance Disclosure Regulation (the “SFDR”)

Where required under the SFDR, fund-specific disclosures will be made available:

in respect of private funds, in the data room and the investor portal for the relevant fund, as applicable; and in respect of listed funds, on the companies’ websites.

In relation to the transparency of the adverse impacts requirement of SFDR, InfraRed appreciates that the detailed underlying rules in this area merit a thorough evaluation, including to ascertain the availability of the data set expected to be required to report under the new requirements. InfraRed does not currently calculate and report principal adverse impacts at an entity level on an aggregated basis, however InfraRed does consider the adverse impacts of investment decisions on sustainability factors in respect of each individual fund.

Climate action

In July 2021 InfraRed joined the Net Zero Asset Managers initiative, a group of international asset managers representing many trillions of dollars of capital, who are committed to supporting the goal of net-zero greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5°c.

By joining the initiative, InfraRed has committed to:

1. achieve net-zero emissions for its portfolio by 2050 or sooner;
2. set interim targets for 2030 for a proportion of its assets under management by July 2022, and Review these interim targets at least every five years.

These commitments follow InfraRed’s decision to become a TCFD supporter in 2020.

Werner von Guionneau, Chief Executive Officer of InfraRed Capital Partners, said:

“We are proud to join the Net Zero Asset Managers initiative. As a responsible asset manager, we firmly believe that it is in the best interests of our investors, clients and other stakeholders that InfraRed engages proactively to make a positive contribution to climate action.

This commitment fully aligns with our vision of creating a sustainable future.” 

Prioritised SDGs

We have aligned our sustainability programme with the United Nations (UN) Sustainable Development Goals (SDGs) framework. Whilst our investments positively contribute to many of the SDGs, we have identified six SDGs which particularly resonate with our business.

By delivering our vision, InfraRed uses its resources to:

Given our corporate values and passions, we choose to prioritise our charitable resources to:

https://www.un.org/sustainabledevelopment/sustainable-development-goals/

PRI

InfraRed has been a signatory to the Principles for Responsible Investment (PRI) since 2011. PRI provides a voluntary framework to help institutional investors incorporate ESG matters into investment analysis, decision-making and ownership practices.

InfraRed has been reporting our corporate and asset-level ESG activities to PRI since 2014. In the 2021 review, InfraRed achieved the highest possible rating of five stars under the PRI scoring system across both Investment & Stewardship and Infrastructure categories. This is the seventh consecutive assessment where InfraRed has achieved the highest possible PRI rating for its infrastructure business.

InfraRed’s 2021 PRI Responsible Investment Transparency Report and InfraRed’s 2021 Assessment Report by PRI are available in the downloads section.

CHARITABLE PRIORITIES & RESOURCES

The assets InfraRed manage play a vital role in creating and supporting sustainable communities and providing clean energy. We understand that our responsibilities extend beyond our investors to the communities we serve. At the cornerstone of InfraRed’s sustainability programme is our commitment to make a positive impact on the communities in which our assets operate with a long-term mindset. This is driven by the passion, energy and talents of our staff who take a genuine, hands-on role in promoting community engagement initiatives.

InfraRed’s Community Engagement Committee oversees our social impact activities and charitable initiatives in accordance with InfraRed’s three charitable priorities:

Good Health and Well-being (SDG 3): Promote initiatives which raise awareness of and provide support to those with mental health issues or enhance the well-being of individuals and the wider community;

Quality Education (SDG 4): Improve the educational and employment outcomes of disadvantaged young people to advance diversity and social mobility in communities; and

Climate Action (SDG 13): Act against adverse climate change to preserve the environment for current and future generations.

Our charitable resources include:

in the first instance volunteering our time and talents,

in the second instance leveraging our business relationships as a multiplier for achieving benefits,

and finally selectively providing financial support as an enabler and further multiplier of the charitable benefits derived from investing our time and leveraging our business relationships.

COMMUNITY CHARITABLE FUND

InfraRed established the £1m InfraRed Charitable Foundation in 2020, which is an independent charity and with the aims of promoting social inclusion and the relief of sickness and preservation of health. The trustees (a mixture of our senior executives and individuals from wider industry) are responsible for the distribution of the Foundation's funds and engage with staff to identify good causes and to help maximise the charitable impact.