TICCS® is a Standard for the Industry
TICCS® is a common classification standard that can be used by asset owners and managers, regulators, banks, and other investors across the various stages of the infrastructure-investment value chain, including consultants and researchers. It is designed to help investment and research professionals:
- take into account the evolution of the infrastructure-procurement landscape in space and time;
- compare sectoral- and business-risk exposures of investor portfolios with broad market benchmarks;
- document investable infrastructure markets;
- analyse the contribution of individual categories of companies to an infrastructure portfolio; and
- design consistent sector- and business-risk-driven investment strategies in infrastructure globally.
TICCS® Structure and Methodology
TICCS® is a four-pillar multi company-classification system designed to capture the characteristics of infrastructure investments. It consists of:
- 3 classes and 5 sub-classes of business risk;
- 8 industrial superclasses, corresponding to 33 industry classes of specific industrial activities and 95 industrial asset-level subclasses;
- 4 geoeconomic classifications; and
- 2 corporate-governance classes with 2 subclasses.
Companies are classified on the basis of individual qualitative and quantitative criteria, including their contractual and regulatory structure and environment; their source of revenues; and their type of industrial activity, including the complexity and level of uniqueness of the relevant infrastructure both from a construction and an operational perspective. Their financial and corporate structure is also taken into account.
Key Features of TICCS®
- Robust: TICCS® is built on the basis of academic research on the financial economics of infrastructure companies.
- Global: Its range of categories ensures that any private infrastructure company worldwide can be integrated into this framework, be it a regulated utility or a solar-project company.
- Risk focused: While TICCS® aims to categorise companies on the basis of their prima facie characteristics. It focuses on groupings that are relevant to risk and that play a role in asset pricing and portfolio construction.
- Dynamic: Infrastructure companies evolve over their life cycles and with changes in national and sector regulation. The evolution of their characteristics plays an important role in infrastructure investment and can be reflected consistently and homogeneously over time.
The TICCS® Comparative Advantage
TICCS® is built in the context of the EDHECinfra database of private infrastructure investments, the largest of its kind, which tracks the financial performance of hundreds of infrastructure companies globally.
Each national market included in the EDHECinfra universe is analysed in detail, including all the relevant aspects of infrastructure-procurement history and regulation in order to match this classification.
TICCS® is also reviewed regularly as new markets and companies are added to the EDHECinfra database. The design of this universe is described in the Index Methodology Standards document available on the EDHECinfra website.
Discover TICCS in this two-minute video