Advancing sustainable infrastructure investing in practice

Infrastructure needs around the world are enormous. Not only are emerging economies urbanizing at a faster and faster pace, but developed have a growing need to renew or build infrastructure that is resilient to climate change. These and other factors are giving rise to greater opportunities to invest in new projects. 

For long-term institutional investors like CDPQ, infrastructure is an especially appealing asset class, as it tends to provide stable and predictable returns and cash flows over the long term. 

The attractiveness of the sector and the availability of capital result in especially significant potential for higher-volume infrastructure investment by institutional investors. In this context, any effort that fosters a better understanding of individual needs and operations is likely to result in a successful collaboration. 

This was the backdrop for the recent creation of a new sustainable infrastructure fellowship program by the Investor Leadership Network (ILN), of which CDPQ is a founding member. 

An enlightening dialogue emerged that will help in a small but decisive way to facilitate undertaking infrastructure projects around the world in the years to come.

Developed in collaboration with the Sustainable Infrastructure Foundation (SIF) and York University’s Schulich School of Business, the combined academic and practical training curriculum was delivered over six weeks in June and July. A total of 13 senior infrastructure managers (fellows) from various growth markets enrolled in the program. The fellows then interned for one to two weeks at one of the participating institutional investors. 

Armed with a mix of theoretical knowledge and hands-on experience, the fellows returned to their respective countries with a deeper knowledge of the processes and criteria used by institutional investors to make decisions about infrastructure investments. As a result, they are now better equipped to develop projects likely to attract the attention of these types of investors and, accelerate the execution of their country’s much-needed infrastructure projects. 

CDPQ recently welcomed three of these fellows: one from Indonesia, one from Mexico and one from South Africa. The quality of our discussions and the calibre of the questions they asked confirmed that the program content and structure are particularly relevant to addressing real-world needs. 

At the same time, having them with us was an opportunity for our teams to learn from them and expand our knowledge of infrastructure investment in their local markets. An enlightening dialogue emerged that will help in a small but decisive way to facilitate undertaking infrastructure projects around the world in the years to come. We were not surprised to learn that ILN investors are already planning next year’s program, which they promise will be even bigger and better.

The three sustainable infrastructure fellows who interned at CDPQ in 2019 (from left to right):

• Chucheka Ben Mhlongo, Head Local Government Support, Development Bank of South Africa (South Africa)
• Rikka Dwi Rejeki, Team Leader of Project Development, PT Sarana Multi Infrastruktur (Persero) (Indonesia)
• Abraham Roberto Vargas Molina, Transport Project Manager, Banobras Fonadin (Mexico)