As part of any investment decision, ESG is integrated into the process from an early stage. The Business Development team, as well as the Management Board, closely consider potential alignment of any new investment to BBGI's prescribed ESG goals and commitment to responsible investment.
As detailed in the strategy and governance section of this report, BBGI's client base consists of governments or government backed projects, with elements of ESG invariably forming the key drivers in relation to many of its investments. BBGI's flexibility in terms of approach on ESG is therefore often set by the client bid terms. As part of BBGI's commitment to best practice referred to in its Prospectus, it will decline opportunities where it considers either insufficient consideration is given to ESG, or issues of poor ESG practice are discovered as part of its due diligence.
In many cases, BBGI's approach on investment in a particular project can be considered quite binary - either it considers there are sufficient ESG controls and commitments in place, or not. In cases where there are not, BBGI will determine whether such shortfalls can be overcome through development and implementation of suitable initiatives or controls prior to, at the point of, or following, investment and if not, will refuse to make an investment.
Some ESG risks may also be more easily mitigated than others, which will also have an impact on whether the BBGI decide to invest or not. As BBGI's main investment strategy foresees long-term ownership of assets with several decades-long lifespans, and often well after the end of any concession period, long-term impact weighs at least as heavily on decision making as short-term impact. Such risks can also have tangible impact on the portfolio and are therefore considered and determined upon as a matter of principle, on top of our aspirations of being a good corporate citizen.
The above detailed considerations are taken into account at all stages of the pre-investment process up to and including the investment decision itself.