Our approach to ESG

A firm commitment

Principle 1:

We will incorporate ESG issues into investment analysis and decision-making processes. AIP is an active portfolio manager and incorporates sustainability principles throughout the investment life cycle.

AIP requires that a targeted investment’s performance with respect to ESG matters be considered pre-acquisition, as part of ultimate investment decisions, and throughout the holding period. A new portfolio asset’s ESG programme, policies and performance undergo a comprehensive review as part of the onboarding process and ESG performance is monitored and reported on regularly at the Board level. AIP believes that, ultimately, ensuring top ESG performance contributes to de-risking an investment and supports optimized realization outcomes.

Principle 2:

We will be active owners and incorporate ESG issues into our ownership policies and practices.

AIP’s Investment Process Memorandum includes written processes, policies and procedures designed to address the management of ESG issues, including guidance on the analysis and management of ESG issues in undertaking due diligence and portfolio management functions relating to specific portfolio investments. Two core policies form the core of our ESG efforts, guiding AIP’s approach to the evaluation and management of ESG/Sustainability matters:

  • Environmental, Health & Safety Policy (the “EHS Policy”)
  • Social Responsibility and Corporate Governance Policy (the “Corporate Governance Policy”)

Once an asset is acquired, AIP’s ESG policies set out requirements for a comprehensive review of the ESG programme, risks and opportunities for the acquired company. Results of the review are incorporated into AIP’s “100-Day Plan” process for the company. Each portfolio company, with AIP’s guidance and operational expertise, develops and implements an appropriate EHS policy tailored to its unique business and operations.

Principle 3:

We will seek appropriate disclosure on ESG issues by the entities in which we invest.

AIP requires regular reporting of ESG performance to portfolio company Boards and to AIP’s investment committee. All eligible portfolio companies are required to participate in the annual GRESB Infrastructure assessment. ESG performance is monitored and benchmarked to industry peers. Additionally, AIP undertakes its own annual ESG Compliance and Risk Review process, in which all portfolio companies participate.

Principle 4:

We will promote acceptance and implementation of the Principles within the investment industry.

AIP has been a pioneer in ESG within the Infrastructure industry and views ESG stewardship as an important responsibility as a leader within the space. AIP participates actively in a variety of ESG-related industry bodies that foster and support the implementation and stewardship of ESG principles, including:

  • AIP’s Head of ESG serves on GRESB’s International Standards Committee, which meets monthly with GRESB leaders to provide feedback and guidance regarding the ongoing evolution of the GRESB Infrastructure Assessments.
  • AIP personnel serve on GRESB’s TICCS (The Infrastructure Company Classification Standard) advisory committee. TICCS was developed by EDHECinfra to provide investors with a common classification standard for the infrastructure asset class. It is a four-pillar multi-company classification system designed to capture the characteristics of infrastructure investments. GRESB’s committee collaborated to provide feedback to TICCS as their classification systems develops to support the inclusion of all infrastructure sectors.
  • AIP ESG professionals serve in the Global Infrastructure Industry Association (“GIIA”) ESG Working Group, which meets periodically to provide feedback to industry participants regarding ESG reporting, investment and regulatory matters.

Principle 5:

We will work together to enhance our effectiveness in implementing the Principles.

AIP will continue to support industry networks and platforms, like GRESB, TCFD, GIIA and TICCS, to collectively address emerging issues and support collaborative initiatives.

Principle 6:

We will each report on our activities and progress towards implementing the Principles.

AIP is committed to transparent and best practices related to ESG implementation and reporting. To that end, our ESG strategy includes many facets:

Annual ESG Compliance and Risk Review Process:

AIP undertakes annually its own in-house ESG Risk and Compliance Review and Reporting process, through which all AIP portfolio companies are required to complete a detailed set of ESG-related questionnaires and provide extensive ESG-related KPIs. All information must be certified by a member of senior management. Results are compiled and presented in an annual report made available to all investors.

AIP ESG Committee:

AIP has established a stand-alone ESG committee as an adjunct to the Investment Committee. The ESG Committee is comprised of the Head of ESG (Chairperson), the Managing Partners, the Chief Risk Officer and a representative from Investor Solutions. The Committee meets quarterly to review ESG policies and implementation to ensure ongoing oversight and continuous improvement as the ESG landscape and issues evolve.

Board Oversight of ESG Issues:

AIP’s ESG policies require that relevant ESG topics be addressed at every portfolio company Board meeting. AIP’s policies further require that portfolio companies report relevant ESG KPIs regularly; these are included monthly to the AIP Investment Committee as part of the Monthly Portfolio Review Process.

GRESB Infrastructure Assessments:

AIP requires that all its funds and eligible underlying portfolio companies participate in the annual GRESB Infrastructure Assessment.