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Report

Built to Last

Infrastructure and trust in a changing world

Owners and operators of infrastructure have always had to meet varied expectations of users and local communities, public authorities and, often, regulators. Where an asset is owned and/or operated by a private company, expectations are further altered and complicated by the need to ensure a fair return for investors. Earning the trust of all stakeholders is a challenge, but maintaining it through the lifetime of an asset is even more difficult.


As an important factor in enabling productive long-term relationships with stakeholders, trust not only confers private infrastructure owners and operators with a social license to operate but also assists in building a solid track record, ensuring industry credibility and establishing organizational resilience.

Built to Last

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Masterplan
Infrastructure

Infrastructure assets provide essential services to support the functioning of society and economies. The expectations of different stakeholders play a critical role in driving the agenda of owners and operators.

Govt

Governments and regulators seek tangible societal benefits and support for national economic growth. They also expect an appropriate balance between consumer prices, long-term resilience and shareholder returns.

Users

Users and communities expect safe and reliable services at a manageable cost. They also expect transparency regarding key asset development decisions.

Bank

Investors expect solid and steady financial performance that anticipates changes in market demand and regulation. They also seek transparent risk and ESG reporting.

Masterplan Infrastructure Govt Users Bank

Infrastructure assets provide essential services to support the functioning of society and economies. The expectations of different stakeholders play a critical role in driving the agenda of owners and operators.

Governments and regulators seek tangible societal benefits and support for national economic growth. They also expect an appropriate balance between consumer prices, long-term resilience and shareholder returns.

Users and communities expect safe and reliable services at a manageable cost. They also expect transparency regarding key asset development decisions.

Investors expect solid and steady financial performance that anticipates changes in market demand and regulation. They also seek transparent risk and ESG reporting.

Three dynamics are complicating the trust challenge for owners and operators. Understanding these ongoing trends is the first step in mitigating their potential impacts. Taking action to address the underlying issues will ultimately protect a business against cascading impacts.

Pandemic Recovery

The steep decrease in demand for many infrastructure assets during the pandemic has had profound effects on revenue and profit, in many cases causing delays in planned capital expenditures. Uncertainty remains regarding when or if demand will return to pre-pandemic levels. Government subsidies for new infrastructure have often been tied to its potential to bolster economic recovery, national resilience, and security.

Accelerating impacts of climate change

With climate change infrastructure becomes more exposed to physical risks, both in terms of extreme weather events and chronic climatic trends. Mobilizing investments in resilience is increasingly urgent. A wide range of transition risks are emerging, creating concerns over the possibility of stranded assets and posing new liability and reputational risks. Many stakeholders are demanding low-carbon assets with minimal environmental damage to construct and operate, and transparent reporting on climate metrics.

Heightened cyber threats

Technological innovations continue to offer infrastructure owners and operators outsized gains in efficiency, cost savings and more. However, data proliferation and the associated increase in digital connectivity come at a cost. Assets face substantial risks from increasingly sophisticated threat actors who can disrupt operations and steal or misuse customer data.

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Masterplan
Transport - All

The pandemic has impacted some infrastructure sectors more than others.

Disappear

Whilst digital infrastructure has thrived, transportation has faced many challenges. As demand returns, concerns about service reliability and health and safety can create trust issues with users and potential knock-on risks for investors.

Construction

Although government subsidies are intended to drive economic recovery...

Machines

... It is unclear whether they will help existing infrastructure businesses or harm them by creating substitutes and alternatives. This may cause worries among investors regarding returns and asset valuations.

Flood

Physical damage can trigger cascading failures that lead to loss of trust from users and communities, and complicate relationships with investors and public sector authorities.

Distruption

Assets are often not designed to withstand future, and even current, climate conditions.

Decarbonize

Uncertainty surrounding the pace and direction of decarbonization can translate into an unwillingness to invest in climate adaptation measures and exacerbate pre-existing concerns about the ability of firms to make necessary transformations.

Data Theft

Data proliferation and increasing asset connectivity have created new vulnerabilities to cyber threats. Data privacy and security risks can challenge the credibility of owners and operators.

Cyber Attack

Cyberattacks can cause failures of critical infrastructure that sometimes are excluded from traditional insurance policies, raising concerns regarding resilience and preparedness among investors and public authorities.

Masterplan Transport Disappear Construction Machines Flood Distruption Decarbonize Data Theft Cyber Attack

The pandemic has impacted some infrastructure sectors more than others.

Whilst digital infrastructure has thrived, transportation has faced many challenges. As demand returns, concerns about service reliability and health and safety can create trust issues with users and potential knock-on risks for investors.

Although government subsidies are intended to drive economic recovery...

... It is unclear whether they will help existing infrastructure businesses or harm them by creating substitutes and alternatives. This may cause worries among investors regarding returns and asset valuations.

Physical damage can trigger cascading failures that lead to loss of trust from users and communities, and complicate relationships with investors and public sector authorities.

Assets are often not designed to withstand future, and even current, climate conditions.

Uncertainty surrounding the pace and direction of decarbonization can translate into an unwillingness to invest in climate adaptation measures and exacerbate pre-existing concerns about the ability of firms to make necessary transformations.

Data proliferation and increasing asset connectivity have created new vulnerabilities to cyber threats. Data privacy and security risks can challenge the credibility of owners and operators.

Cyberattacks can cause failures of critical infrastructure that sometimes are excluded from traditional insurance policies, raising concerns regarding resilience and preparedness among investors and public authorities.



Built to Last

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