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InfraRed Capital Partners Limited

PRI reporting framework 2019

Export Public Responses

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Infrastructure Monitoring and Operations

INF 12. Proportion of assets with ESG performance targets

12.1. Indicate the proportion of infrastructure assets for which your organisation and/or operators included ESG performance in investment monitoring during the reporting year.

 (in terms of number of infrastructure assets)

12.2. Indicate ESG issues for which your organisation, and/or operators, typically sets and monitors targets (KPIs or similar) and provide examples per issue.

List up to three example targets per issue

          Social infrastructure investments typically have energy usage targets by comparison to the building volume. The energy usage strips out weather effects to isolate true performance.
          Utility usage reduction initiatives are actively encouraged for all projects.
          The general condition of the project facilities are monitored annually.

List up to three example targets per issue

          Sponsorship/community support initiatives are actively encouraged wherever possible. Activities are recorded and expenditure is tracked against a budget. An annual review is undertaken.
          All Special Project Companies (SPCs) are required to have a Health & Safety policy and effective processes and procedures to ensure compliance.
          All SPCs are required to have effective anti-discrimination policies in place for all contracted organisations within the projects. An annual review is undertaken.

List up to three example targets per issue

          All Board meetings of the SPCs to be presented with and discuss the management team’s Health & Safety report.
          All Board meetings of the SPCs to be presented with and discuss the management team’s ESG report.
          An Infrared director is expected to undertake a H&S inspection of the asset annually and no less frequently than every 18 months.

12.3. Additional information. [Optional]

InfraRed's portfolio of investments is concentrated in the Social Infrastructure sector. Typically such projects have KPIs established by the Client in the project agreement documentation for energy usage (gas and electricity) and in a proportion of investments for water usage. The energy KPIs almost always relate to the amount used for a given volume of building.

A full description of the monitoring activities undertaken via the SPC Boards is included in the response to INF 11.3.

InfraRed's ESG broad approach is to treat all its assets, whatever the sector or geographic location, in an equal manner with similar expectations for outcomes. However it has to be recognised that some of the individual assets have contracted activities that are closer to the local community than others and that has a direct impact on the degree and scale of community interaction that a project can achieve. As an example of this comparison, a hospital project, where the SPC undertakes all maintenance, cleaning and catering, has a greater ability to connect with the local community both directly and indirectly through its Client than a road project based on an availability criteria; the road and its operation has a greater potential for environmental damage in some circumstances if maintenance standards are not continuously provided to a high standard and it is more difficult for such a project to connect with the local community.

INF 13. Proportion of portfolio companies with ESG/sustainability policy

13.1. Indicate whether you track the proportion of your infrastructure investees that have an ESG/sustainability-related policy (or similar guidelines).

13.2. Indicate the proportion of your infrastructure investees that have an ESG/sustainability-related policy (or similar guidelines).

(in terms of number of infrastructure investees)

13.3. Describe how your organisation, and/or your operators, contribute to the infrastructure investees’ management of ESG issues. [Optional]

In INF 05 there is a description of the InfraRed processes and principles that ensure that the investees, other stakeholders and delivery partners are required to meet key Responsible Investment and ESG benchmarks before InfraRed will select them where it is a primary "greenfield" investment or invest in the asset if the transaction is in the secondary market. ESG matters are a key selection benchmark that must be considered if the investment is to proceed. Consequently InfraRed has partner organisations that share its objectives allowing effective collaborative working on such issues.

InfraRed has two major ways to engage with ESG matters on its assets. Firstly, the Management Service Provider appointed to manage the assets on a day to day basis will have ESG service delivery obligations in its appointment that will require it to engage with the operators, subcontractors and clients on a regular basis. They will be obliged to report to the SPC's Board on ESG issues as part of the routine management reports. Secondly the InfraRed individual Asset Manager, who will be a member of that SPC Board, will raise relevant ESG issues at the regular Board meetings including the provision of feedback from across the InfraRed portfolio sharing best practice and other useful information. InfraRed's policy is to have one of the Board of directors appointed to take specific ESG responsibility. On many projects there will be periodic liaison meetings between the SPCs Board and the Board of directors of the SPC's client and ESG issues are routinely raised at this level to assist the project teams in their daily management level ESG efforts.

InfraRed has produced a comprehensive guidance document "ESG Best Practice Guidance for SPV Managers (Infrastructure Projects)" that it developed in consultation with its Asset Management Team members and Management Service Providers, This includes examples of ESG initiatives and best practice together with an overview of responsibilities and InfraRed's objectives.

In 2016 InfraRed started organising annual half day workshops with many of its management service provider teams focused on improving their approach to Responsible Investment. In 2018 the focussed switched to more in depth and routine discussions with the leading management service provider teams to develop their specific performance in relation to the management of the projects that they managed, and this more focussed and regular approach has led to further improvements in the approach to Responsible Investment performance.

INF 14. Type and frequency of reports received from investees (Private)