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3.5 Social Pillar, TICCS®+

Infrastructure is created to provide specific services to end users, most of whom tend to be either the general public or public and private sector organizations. Services such as access to electricity, transport, or telecommunication provide direct benefits to end users, and the utility directly derived from consuming infrastructure services is private and does not constitute a form of social impact. For instance, roads provide a service for individuals and firms to move people and goods from one point in space to another. Electricity companies provide households and firms with power to operate electrical devices.

However, because they often provide essential services, the activities of infrastructure companies also have significant social impacts on individuals, households, the economy, and society. The social impact on the general public can be of two types: Economic Development and Human Wellbeing. The former refers to the social (indirect) impact of infrastructure services on individuals, while the latter refers to social impacts on the collective. Infrastructure companies and services enable economic development impacts by impacting the value of adjacent land, and real estate, and enabling businesses and other infrastructures. For example, beyond the strict consumption of transport services, mobility creates valuable real options for individuals who can - for example - work, study, or receive medical treatment as a result.

Infrastructure companies can have a range of impacts on the collective welfare of the general public, such as infringing on or protecting human rights, impacting the health conditions of the public, disturbing or improving the quality of life of society (e.g., by creating or avoiding congestion), and the preservation, promotion, or degradation of heritage and culture.

The regulator is an important social actor for the infrastructure asset class. In infrastructure investment, the government specifies in the concession different public service constraints (pricing structure, safety, and environmental regulations). The intervention of the government rests on different arguments: the existence of externalities, natural monopolies, public goods, and imperfections in the capital market (Debande, 1999). Thus, building infrastructure (national, regional, and local) requires long-term support of the regulator and timely regulator engagement.

The above discussed how infrastructure can have an impact on the social super-classes. Next, we discuss how infrastructure companies are also exposed to social risks of two types: social acceptability risks and risks to workforce availability.

Social acceptability is a central issue when investing in private infrastructure companies. As indicated above, infrastructure assets have a significant environmental footprint and can lead to significant disruption for surrounding populations that may not always be the direct beneficiaries of the construction of these assets (e.g., dams, high-voltage power transmission, etc.). The for-profit private operation of infrastructure companies is also highly controversial in several countries. There is a documented regulatory pendulum effect by which different countries go from periods of supporting private infrastructure ownership to opposite periods of widespread nationalizations, followed by new waves of privatizations (see Blanc-Brude, 2013, for a discussion and literature review).

The social acceptability risk of infrastructure companies is split between the perception of its customers, including in terms of service quality, affordability, and accessibility, that of the general public especially the reputation of the sector and the firm, as well as sentiments surrounding privatization.

Workforce availability is another class of social risk for infrastructure companies. While operating infrastructure assets is usually not a labour-intensive activity, their construction and maintenance phases can be. Some infrastructure companies such as ports or utilities employ numerous staff exposing them to the risk of industrial action from unions as well as issues with the availability of skilled labour required for specific purposes (such as needing certified crane operators in ports).

Finally, regulators can pose a risk to the operations of infrastructure companies. For example, by updating or implementing new legislation, such as a carbon tax to support alignment with a low-carbon future. Regulatory intervention in the case of poor performance or poor acceptability of specific companies or sectors can pose the risk of fines, nationalization (where applicable), and business closure.


Debande, O. (1999). Private financing of infrastructure. an application to public transport infrastructure.

Blanc-Brude, F. and O. Ismail (2013). Measuring risk in unlisted infrastructure equity investments. EDHECinfra Research Publication.

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