In an era of headwinds against generic sustainable investment strategies, infrastructure, and in particular impact in infrastructure, stands out as an investment approach that delivers stable financial returns and robust sustainable outcomes.
Impact investing has evolved significantly from its early days. Today, it is a sophisticated strategy that not only mitigates harm but actively seeks to generate positive social and environmental outcomes. Infrastructure, with its pivotal role in society, is at the forefront of this movement. From renewable energy projects that reduce carbon emissions to water systems that ensure clean access for all, infrastructure investments are spearheading the drive towards a sustainable future.
In general, infrastructure assets demonstrate resilience against market headwinds due to their strategic importance in achieving societal goals and development. Therefore, within this asset class in particular, we can distinguish between sustainable investment strategies that generate positive impacts and Impact investment strategies.
Indeed, within a sustainable investment strategy, GPs can identify the projects that make the most of market opportunities due to their positive contribution. This approach supports an authentic and clear investment narrative within the sustainable investing space, where broad themes untethered to real life outcomes have fallen out of favor with many LPs. It acknowledges the non-financial benefits of investing without imposing formal impact methodologies, distinguishing it from funds that specifically target impact returns alongside financial gains.
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