Regulation and Sustainability: Moving the Conversation Forward
How sustainability is understood by businesses and investors has changed dramatically since the 1960s. It has grown from being an annual report to shareholders of the actions taken in relation to a company’s social and ethical obligations, to becoming an integral part of many companies’ business strategies.
There isn’t a global agreement on corporate social or sustainability reporting requirements. However, much of the push behind the incorporation of sustainability into business operations is coming from the globalisation of supply chains, and mounting pressures from investors, asset owners, non-government organisations and the general public for companies to report on ESG risks. As a result, there are significant differences in how the US, the EU and Asia are developing frameworks, programmes and legislation to achieve the global shift to sustainability.
At the regional level, the European Union (EU) has a unified sustainability reporting, enforced through Directive 2014/85/EU. In January 2018, the European Commission (EC) laid out plans to cement sustainability into the European financial system. It suggested introducing a classification system of what is “sustainable” and measures to impose conditions on corporate reporting requirements and the duties asset managers had to investors.
Rapid economic growth has left China facing some of the most severe environmental issues on the planet. China views sustainability as an opportunity for its companies to develop innovative technologies that will allow the country to move up the value-added export chain. What is clear is that it wants a return on its environmental investments. By focusing on research and development, China hopes to lead the world in environmental technology.
However, China still must deal with with the social and economic pressures that have built up as the country has developed. Failing to address these sustainability issues could have serious future cost, reputation and growth consequences for businesses in China.
Embedding the right methodology within a rigorous quality management framework is key to delivering a professional model audit service. In our previous article, we explored how ethics drive our decision-making. Now, we turn to the importance of embedding the right methodology within a rigorous quality management framework. Pioneering the shadow modelling approach Traditionally, financial model […]
Explore the latest valuation trends in the energy and infrastructure sector, with a spotlight on valuing projects towards the end of their lives. Our Q3 2024 update provides a snapshot of some of the main publicly available valuation trends across the energy and infrastructure sector, covering both debt and equity metrics. Three key themes from […]
According to Infralogic data, over $1 trillion in transactions for energy and infrastructure projects have been subject to model audits in the past decade. Of this, 75% by value were completed by accounting firms. This shows that, when it matters most, accounting firms are typically the preferred choice for model auditing. Indeed, for major transactions, […]
Welcome to the first in a series of articles exploring the importance of a professional approach to model auditing in providing assurance for energy and infrastructure transactions. Financial models are at the heart of energy and infrastructure transactions. They are essential tools for assessing investments, securing financing, and planning for the long-term success of projects. […]
Euphorically titled the ‘holy grail of clean energy’, fusion technology promises an almost limitless, stable, and carbon-free power source. Recent advancements are bringing industrial applications in reach, shifting the focus away from primary research-oriented discussions. Yet, addressing the remaining technological, financial, and social challenges remains essential. In our previous introduction, Fusion energy: revolution in the energy […]
Explore the latest valuation trends in the energy and infrastructure sector, with a spotlight on the use of NPV calculations. Our Q2 2024 update provides a snapshot of key publicly available valuation trends across the energy and infrastructure sector, covering both debt and equity metrics. Three key themes from Q2 2024: Stable cost of debt […]
Fusion energy stands on the brink of revolutionising the energy sector, offering the promise of an almost limitless, clean, and stable power source. Recent breakthroughs have brought us closer than ever, with successful proof-of-concept trials and the operation of early reactors. Despite being in the early development stages, these advancements indicate the potential for a […]
Explore the latest valuation trends in the energy and infrastructure sector, with a spotlight on the challenges of valuing platform investments. Our Q4 2023 update offers a snapshot of key publicly available valuation trends, covering both debt and equity metrics across the sector. This quarter we continue to look at trends in debt and equity […]
We are pleased to share a notable achievement for Mazars’ global model audit practice. Infralogic Deals’ latest league tables confirm our position as the #1 global model auditor for the tenth consecutive year, by both volume and value for 2023. Throughout this decade, our team has provided opinions on over 600 projects with a combined capital value […]
The cost of natural gas in Europe reached €345 per megawatt-hour (MWh) in August 2022, compared to €29 in June 2021. Similarly, the cost of electricity soared to 1,000 €/MWh versus €85 less than a year before. It would be an understatement to say that the recent energy price volatility generated a significant challenge for […]
Discover the latest valuation trends in the energy and infrastructure sector, with a spotlight on how country risk premiums are used in infrastructure valuations. Our Q3 2023 update offers a snapshot of key publicly available valuation trends, covering both debt and equity metrics across the sector. This quarter we continue to look at trends in […]
Digital transformation and innovation hold the potential to overhaul energy operations, ushering in a new era of consumer experience, placing sustainability at its core, and generating a richer economy. By harnessing the power of innovative engineering, the energy industry can overcome the challenges posed by climate change and adopt responsible energy solutions This transformative journey […]
Discover the latest valuation trends in the energy and infrastructure sector, with a spotlight on how debt impacts equity valuations. While traditional valuation theory links higher debt to increased risk and a higher cost of equity, infrastructure valuations require a more nuanced approach. Our Q2 2023 update provides a snapshot of key publicly available valuation […]
This quarter we continue to look at trends in debt and equity metrics relying primarily on publicly available information. In relation to the equity trends, we use the Mazars indices of listed infrastructure funds and listed renewable energy funds, compiled on the basis set out in Appendix 1 to this update. Three key themes from […]
As part of the C-suite barometer 2023, we asked business leaders how they are tackling the energy crisis. In this roundtable discussion, Mazars’ Mathieu Mougard and Philippe Bozier are joined by Marc-Antoine Eyl-Mazzega of IFRI, to discuss some of the pressing energy issues facing businesses this year and beyond. Q: What’s the state of play […]
Watch our joint webinar with CMS to learn more about hydrogen. We discuss hydrogen project modelling, the rapidly evolving regulatory aspects supporting the hydrogen economy, and building an effective investment case critical to business decisions. The future of energy production around the globe is transforming. Hydrogen shows growing potential in the transition to a low-carbon […]
Explore the latest valuation trends in the energy and infrastructure sector, with a spotlight on valuing new sectors by comparing return and risk expectations with established infrastructure sectors. Our Q4 2022 update provides a snapshot of key publicly available valuation trends, covering both debt and equity metrics. This quarter we continue to look at trends […]
Locational marginal pricing, if introduced, would represent the biggest change to the UK’s electricity market for decades, and its impact on asset valuations could be profound. In May 2022, National Grid ESO published its Net Zero Market Report, which explored the current market design for electricity across Britain. The report concluded that: “Britain’s electricity market […]
Already vital to many industries, UK hydrogen production will need to increase significantly if the country is to achieve its 2050 net-zero target. Since publishing its UK Hydrogen Strategy in August 2021, which included the initial target of producing 5GW of low-carbon hydrogen by 2030, the government has since strengthened its ambition by doubling its […]
Welcome to the Q3 2022 edition of our quarterly valuation update, which provides a snapshot of some of the main publicly available valuation trends across the energy and infrastructure sector, covering both debt and equity metrics. This quarter we continue to look at trends in debt and equity metrics relying primarily on publicly available information. […]
As countries endeavour to meet increasingly ambitious emission targets, many consider withdrawing from the Energy Charter Treaty (ECT). However, with member parties bound by a 20 year sunset clause, is this the right decision? Why are countries withdrawing from the Energy Charter Treaty? The last two weeks have seen Spain, the Netherlands and France state […]
Public-Private Partnerships (PPP), also known as Private Finance Initiatives (PFI) in the UK, have become a solution to a gap in public investment derived from natural budgetary constraints worldwide. This model is based upon joint working and risk sharing and brings together private sector solutions, technologies and investments and public sector oversight. Long-term PPP contracts […]
Welcome to the Q1 2022 edition of our quarterly valuation update, which provides a snapshot of some of the main publicly available valuation trends across the energy and infrastructure sector, covering both debt and equity metrics. This quarter we continue to look at trends in debt and equity metrics relying primarily on publicly available information. […]
Welcome to the Q4 2021 edition of our quarterly valuation update, which provides a snapshot of some of the main publicly available valuation trends across the energy and infrastructure sector, covering both debt and equity metrics. This quarter we continue to look at trends in debt and equity metrics relying primarily on publicly available information. […]
The past two years have seen an increase in the number and sophistication of cyber-attacks, creating a significant rise in cyber risk for many companies. As the February 2021 attack on a water treatment plant in Florida demonstrated, the water and wastewater sector is not exempt from attacks, which could have potentially severe consequences for […]
The way big data technologies are used in the water and wastewater industry has changed over the past few years. They are no longer looked at primarily as a means of simply gathering data, but as a management tool for improving operations, performance, and efficiency, according to Mazars’ 2021 US Water Industry Outlook. Based on […]
Welcome to the Q3 2021 edition of our quarterly valuation update, which provides a snapshot of some of the main publicly available valuation trends across the energy and infrastructure sector, covering both debt and equity metrics. This quarter we continue to look at trends in debt and equity metrics relying primarily on publicly available information. […]
In recent years, the market has seen an increasing number of high-profile defaults of Private Finance Initiatives (PFI) and Public-Private Partnerships (PPP) – and the risk remains that these continue going forward. After examining major risk factors causing distress in part one of this two-part series, we focus in this article on common issues and […]
Private Finance Initiatives (PFI) and Public-Private Partnerships (PPP) have come under increased scrutiny in recent years after a rising number of defaults. In part one of this two-part series, we examine five major risk factors causing distress, while in part two, we reveal common issues and key success factors when it comes to restructuring PFI […]
This quarter we continue to explore trends in debt and equity metrics and have included a spotlight on digital infrastructure funds, looking at some emerging valuation trends from the two digital infrastructure funds that have recently been listed on the London Stock Exchange.
Recent cyber-attacks on critical infrastructure, such as the ransomware attack on the US Colonial Pipeline which forced the largest fuel pipeline in the country to shut down its operations for several days, should serve as a warning of vulnerabilities faced by all nations. As cybercriminals’ hits against power grid operators, water treatment plants and other […]
Infrastructure is an increasingly mature asset class, with a growing number of listed and unlisted funds established specifically to invest in and manage real assets across the energy and infrastructure sectors. To provide a fresh perspective on valuation metrics, Mazars has launched the ‘quarterly valuation update’ for the global energy and infrastructure sectors, covering both […]
Achieving sustainable mobility requires scaling vehicle sharing, decarbonising the energy system, and funding and building infrastructure for electric vehicles and other alternatives to petroleum. As each country takes its own approach, what steps has Singapore taken to become more energy efficient, and what challenges do we face on the road to sustainability?
In a previous article, I wrote about the early impact of Covid-19 on equity valuations across the energy and infrastructure space, noting changing cashflow expectations in some sectors, but not necessarily all, and no general trend of higher discount rates. I will provide an update of valuation trends in a future piece, but in this […]
As advisors and financial modellers, we are in the business of change, and trying to forecast what different futures can look like. As we enter a new period of “interesting times”, it is worth looking back at what happened to businesses after the last crash, and how previous futures were temporarily and permanently altered. After the 2008 crash, cash became a […]
It has been some few weeks. I am writing this from home, connected to team members and clients through technology but otherwise working in isolation, and this experience will be familiar to nearly all of our clients around the world. As well as its direct impact on people who have contracted the disease, Covid-19 has […]
The renewable energy sector has experienced its fair share of bad deals. Some sub-sectors and geographies have seen particular systemic issues that go beyond individual projects but the sector has actually been good at learning lessons from failures – especially legal and technical.
The global green bond market has expanded rapidly in recent years, growing by 75% between 2016 and 2018 and recording an issue volume of 175 billion dollars in 2018. One of the new features of this market is the issuing of securities by a variety of non-public players, including non-financial firms. We also expect the […]
Current state of valuations in the renewable energy markets A short thought to kick off with, based on experience working with a global client base of renewable energy developers, financiers, investors and asset managers. Across markets, valuations of renewable energy assets are continuing to rise, and we are seeing evidence of this everywhere – from […]
Regulation can be a powerful force in driving sustainable practices amongst businesses – from corporate reporting to mandatory action. But what are the right metrics for sustainability and who should be responsible for tracking them? The response to these questions may be different based on geography, sector and market segment. As demand for sustainability grows […]
Storage is the next frontier in the global transition to renewable energy. Some markets are moving at a more rapid pace than others, and in our recent breakfast briefings on the topic ‘valuation of storage assets’, presented in collaboration with Norton Rose Fulbright, we discussed the experiences from the United Kingdom, Australia and the United […]
There is no question that the U.S. water infrastructure needs repair. The unprecedented flooding and droughts across the country over the past 15 years and the lead contamination of public water in Flint, Mich., are just a few examples that highlight widespread need for more resilient water infrastructure. While there has been movement to improve […]
Companies are starting to discover how they can incorporate new technologies such as artificial intelligence (AI), blockchain or the Internet of Things (IoT) to advance their environmental, social and governance (ESG) efforts and the way they report on them. Over the past decade the world’s biggest companies have started to come under pressure from stakeholders […]
Mazars and Eversheds Sutherland jointly hosted a panel event attended by nearly 100 industry participants focusing on the viability of subsidy-free renewables in the UK. Welcoming experts from across the sector, our panel discussed the major topics in the industry, and addressed questions from the audience. The main outcomes of the discussion were that: The […]
The value of Bitcoin as a worldwide payment system and ongoing investment in the currency, has been a rollercoaster ride from December 2017, when prices surged above $19,000 per Bitcoin, to June 2018, when each coin fell to approximately $7,000. Bitcoin is produced by computers via blockchain technology, which is a record of transactions maintained […]
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