Infrastructure developers show lack of urgency over long-term environmental risks
Some global investors are still failing to consider the impact of climate change on their infrastructure assets, leaving major infrastructure developments exposed to increased long-term physical risks, according to a new report by Marsh.
According to Marsh’s Sustainable Infrastructure - Weathering the Storms, the sustainability of infrastructure assets should be assessed at the project inception stage and throughout the asset’s lifecycle.
But many investors, particularly those operating in sectors or places still largely unaffected by severe weather or environmental pollution, have yet to build climate change into their risk models.
Marsh Europe, Middle East and Africa environmental practice leader Cliff Warman said: “The physical damage to property assets and infrastructure as a result of severe weather events, such as storms, floods and droughts globally, is having a direct impact on society and business, particularly in more fragile and developing economies.
“While some infrastructure investors are starting to take environmental risk criteria into account when undertaking project appraisals, there is a prevailing lack of urgency among firms that have yet to be affected by the changing climate and extreme weather.”
Marsh head of infrastructure risk advisory services Martin Bennett said: “We face an uncertain future and climate change will continue to challenge the nature of infrastructure investments. It cannot be overlooked where investment is being made in infrastructure that is expected to perform for many decades.”