Infrastructure matters to people and businesses everywhere, every day. From roads and railways to power plants and communication networks across the globe – we believe a well‑functioning, modern infrastructure system serves as the foundation of economic development and enhances the quality of life.
For more information on the financial terms used in this article, please consult the glossary.
What is infrastructure?
Infrastructure broadly refers to assets (such as roads, power grids and communication networks) associated with the provision of essential services necessary for the functioning of modern societies and economies.
Why infrastructure now?
$15 trillion
Maintaining and developing infrastructure that is fit for the future requires investment. By 2040, the world will require an estimated $15 trillion to fulfil basic infrastructure needs¹.
A growing asset class
Amid the growing demand for infrastructure assets, listed infrastructure has gained recognition as a distinct asset class with the potential of reliable income and long-term growth from strategic assets exposed to powerful structural trends.
Evolving
With data centres and towers integral to the digital revolution and new power sources and grid networks essential for energy security and decarbonisation, infrastructure is arguably at the heart of the multi-decade trends that could reshape the global economy in the coming years.
¹ Amin Mohseni-Cheraghlou and Naomi Aladekoba, ‘The global infrastructure financing gap: Where sovereign wealth funds and pension funds can play a role’, (atlanticcouncil.org), October 2022.
"Listed Infrastructure provides the opportunity to participate in the structural growth and dividend generation of companies delivering essential socio-economic services. Infrastructure is essential for life and increasingly important for the environment. The companies we invest in are helping the world decarbonise, digitise and industrialise. The noncyclical nature of the earnings from these companies generates dependable cash flows and dividends that can compound and protect against inflation. Infrastructure is essential for life, beneficial for the environment and additive to investment portfolios."
Alex Araujo
Fund Manager
Why now?
- We believe listed infrastructure has the potential to provide reliable and sustainability focused long-term growth
- Companies are paying increasing attention to ESG credentials in their efforts to become better businesses, both from a financial perspective as well as looking to ensure sustainability
Why invest with M&G?
A growing asset class
A growth-focused approach, investing in securities that meet ESG criteria and applying an exclusionary approach.
Focus on dividend growth
Investing in companies that increase their dividends can provide inflation protection and real growing income.
Powerful thematic tailwinds
The asset class is exposed to different structural growth trends, such as: demographics, decarbonisation and digitisation.
Investing aligned with Sustainable Development Goals (SDGs*)
Our diversified approach invests in three distinct infrastructure categories: Economic, Social and Evolving. Each category can help contribute to the promotion of different Sustainable Development Goals (SDGs).
*While we support the UN SDGs, we are not associated with the UN and our funds are not endorsed by them.
“Infrastructure, in particular, underpins all of the SDGs. It plays a critical role in society because it can influence development far into the future –both positively and negatively. This is why it is vital to understand the influence that infrastructure systems have on the SDGs.”
Source: ‘Infrastructure: Underpinning sustainable development’, The United Nations Office for Project Services (UNOPS), 2018.