Climate impact infrastructure debt strategy
Human-generated CO₂ emissions show little sign of abating and estimates suggest that USD 4 trillion in clean energy investment is required annually to meet net zero obligations by 2050.¹ This, coupled with increasing digitalisation globally, may provide strong tailwinds for infrastructure assets over the coming years.
Strategy features
Attractive risk/return profile
Infrastructure debt can offer attractive risk-adjusted returns at core infrastructure equity-like levels, as well as protective characteristics including predictable cashflows, high barriers to entry and low volatility.
Multi-channel sourcing
The award-winning investment team2 makes use of its own extensive sourcing network, the proven multi-channel origination capability of different BNP Paribas entities, and the Group’s close relationships with more than 200 General Partners (GP).3
Positive environmental impact
The strategy complies with our global ESG4 standards and policies and aims to contribute positively to climate change mitigation by investing in climate solutions across renewables, utilities, digital and social infrastructure, and more.
Investment philosophy
The team seeks to invest in infrastructure projects that contribute positively to climate change mitigation without compromising on returns. Their approach to investing in infrastructure debt is centred around four core beliefs: (1) optimal opportunity selection is key to driving returns; (2) extensive sourcing is essential for effective relative value analysis; (3) market insight is fundamental for higher returns; and (4) favouring projects with high environmental and climate added value can lead to potential positive environmental outcomes.
Investment process
The strategy follows a disciplined bottom-up investment process based on rigorous credit analysis and cash flow sustainability to deliver optimal portfolio outcomes:
- Origination: Opportunity sourcing and credit and sustainability analysis
- Portfolio construction: Validation for investment and execution
- Continuous monitoring: Portfolio monitoring and risk management
Team and expertise
Based in Paris, our Infrastructure Debt team is co-led by Stéphanie Passet, 24+ years of industry experience, and Vincent Guillaume, 17+ years of industry experience, and overseen by Karen Azoulay, Head of Real Assets.5
The team has extensive, varied and complementary experience in asset management and investment banking including advising, originating, structuring, and managing infrastructure deals across multiple sectors. Since 2018, it has raised around EUR 2.9 billion and completed more than 80 investments in senior and junior infrastructure debt across Europe.6
Fully integrated within BNP Paribas’ 100+ strong Private Assets group, team members enjoy access to company-wide resources including our global trading and risk management platform, dedicated Sustainability Centre, Quantitative Research Group, Macro Research team, and the wider BNP Paribas network.
[1] Net Zero Roadmap: A Global Pathway to Keep the 1.5 °C Goal in Reach, International Energy Agency, September 2023
[2] BNP Paribas Asset Management’s Infrastructure Debt solutions have received multiple industry recognitions over the years including Scope Group’s 2024 Infrastructure Debt Award, ESG Investing’s 2022 Best Infrastructure Investment Fund Award, and Sustainable Investment Awards’ 2021 Infrastructure Fund of the Year Award.
[3,5,6] BNP Paribas Asset Management, as of 30 September 2024
[4] ESG: Environmental, Social and Governance. ESG assessments are based on BNP Paribas Asset Management’s proprietary methodology which integrates all three aspects of E, S and G.
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Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions).
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