Five Principles for Sustainable Infrastructure
We continually aim to invest for a smarter future and understand how important it is to engage in sustainable practices to help our future. This is why, before any investment is made, and throughout the investment cycle, we evaluate and score the investment against a number of predetermined criteria. This criteria forms our Five Principles for Sustainable Infrastructure.
To complete this assessment, we use a variety of Environmental Social and Governance (ESG) due diligence tools. These can range from questionnaires, which are given to key project counterparties to complete as part of the transaction process, to expanding our adviser engagement, allowing us to report in greater detail on the social and community impacts.
Foresight's Five Principles for Sustainable Infrastructure
Sustainable Development Contribution
For our infrastructure investments, our long term vision has been driven by the opportunities which have resulted from the shift towards an increasingly decarbonised economy.
Using the United Nations Sustainable Development Goals (SDGs), we have focused our investment approach and established specific sustainable infrastructure strategies that are aligned to make a direct positive contribution.
Our Investment Team consider the following factors to determine the score:
Affordable and Clean Energy
Does the project promote the development of clean and sustainable energy?
Industry, Innovation and Infrastructure
Does the project invest into resilient and sustainable infrastructure, such as energy, transport and water resources? Does the project increase resource and energy efficiency?
Does the project positively contribute to reductions in greenhouse gases (GHGs)? Does the project contribute to national and international climate change targets? What is the direct contribution to carbon emissions from the project’s activities?
We believe it is necessary to consider the environmental impact of an investment. This includes: emissions to air, land and water, effects on biodiversity, noise and light pollution, and analysis of the long‐term climate resilience of a project.
Our Investment Team use the following factors to determine the score:
Life on Land
Does the project protect, restore and promote the sustainable use of ecosystems, promote biodiversity and halt and reverse land degradation?
Species Protection or Promotion
What is the project’s impact on native / migrating species to the site? Does the project have high rates of species mortality? Does the project promote or support wildlife at the site?
Is the feedstock (if applicable) processed by the project in line with the sustainability criteria set out by the associated incentive scheme?
Does the project take steps to minimise waste production and maximise recycling? Does it make a positive contribution to landfill diversion?
Emissions, Effluents and Wastes from Both Normal and Abnormal (E.G. Accidental) Conditions
What are the outputs of the project, and how can any undesired outputs be mitigated or minimised?
We are conscious of our role in both the local communities in which our assets operate and our role as an employer and good corporate citizen.
Our Investment Team takes the following factors into consideration:
Health and Wellbeing
Does the project help to protect the health and safety of its employees and any third party? Is it compliant with all relevant Health & Safety legislation? Is there a risk of fines, penalties or regulatory intervention?
Local Economic Impact
How much of the project’s inputs and supplies are sourced locally? How much of the labour force comes from the local area?
Local Social Impact
Is the project well screened from key vantage points? Does the project operate within noise restrictions? Does the project cause shadow flicker or interrupt TV signals? How are these problems mitigated?
Does the project take steps to manage impacts on the local population or to create positive effects through engagement with the local community? Are educational visits carried out to the project to promote the benefit of the assets?
How does the project contribute to the local community through investment in infrastructure / service provision?
How long will the project last for? Will the site be returned to its existing state when the project completes? Does the project have a decommissioning plan in place already? Does this plan promote the recycling of materials recovered from the decommissioning of the project?
While infrastructure project companies often do not have employees, it is important to evaluate their wider governance framework. Key considerations for the Investment Team include:
Compliance with Laws
Is the project compliant with relevant local, national and international laws and regulations? Are any prosecutions pending or threatened?
Employment and Human Rights
Does the project comply with relevant employment legislation? Does the project ensure that the human rights of its employees are considered and protected?
Anti‐Bribery and Corruption
Does the project have an Anti‐Bribery policy?
Are the project’s decision‐making processes and legal documents appropriate, robust and supportive of shareholders’ rights? Is there sufficient accountability, favourable indemnities and warranties in project documentation?
Is the composition of the Board and the quality and experience of its members suitable? Is the Board free from conflicts of interest? Does the Board contain independent directors?
Third Party Interactions
We analyse the key counterparties in a project’s supply chain and seek to evaluate and score them in line with the above criteria. Our Investment Team will look at the following factors to derive the score:
Compliance with Laws
Are the key counterparties compliant with local and international laws, including environmental, health and safety and employment laws?
Key Counterparty Supply Chain
Are steps taken to provide reasonable assurance that there are no labour standards, health and safety or human rights issues in the supply chain? Does any part of a key counterparty’s supply chain come from conflict affected or high‐risk areas?
Is there risk of reputational damage or litigation? Do the project’s key subcontractors comply generally with our sustainable investing criteria?
Key Counterparty Policies
Have the following policies regarding a Modern Slavery Statement, CSR policy, Code of Ethics, anti-bribery / corruption policy, diversity policy, health & safety statement and GDPR policies been requested and received (to the extent relevant?)