MIIF comes within the Macquarie Capital (MacCap) Risk Management Framework, which itself lies within the broader operational and compliance risk management framework of Macquarie Group Limited (Macquarie). Macquarie has made a public statement on corporate citizenship which is available on its website.

Macquarie's commitment is based on Macquarie taking a long-term view of its business activities and acknowledging the importance of good custodianship to the communities in which it operates.

As set out on Macquarie's website, this commitment is underpinned by:

• A clear expectation of ethical behaviour from Macquarie staff, which has been adopted by MIIF and which is set out in MIIF's code of conduct (available on request); and
• A robust framework of policies including those relevant to environmental, social and governance (ESG) responsibilities.

Responsibility

All Macquarie staff, including those engaged by MIIF, have a collective responsibility to ensure that Macquarie continues to be a good corporate citizen. MIIF's manager is supported in this by Macquarie's integrity, equal employment and sustainability and environment officers, and the risk management group.

Macquarie staff may also contribute their time, expertise and/or finances to community organisations through the Macquarie Group Foundation.

MIIF believes that many social, environmental and economic benefits arise from responsible private sector development and operation of high quality infrastructure. MIIF is also aware that with these benefits lies the potential for risk, including ESG risk.

MIIF's approach to managing risk, including ESG risk, falls under the Macquarie Capital framework, which is consistent with Macquarie's framework. However, the Macquarie Capital framework also incorporates policies and practices that reflect the risks specifically associated with infrastructure funds' management operations, and infrastructure investments.

The framework is applied throughout MIIF's investment process as follows:

• Asset selection – environmental and social responsibilities are reviewed as part of the acquisition due diligence process;
• Ongoing asset management – regular asset board reporting enables compliance with environmental requirements to be monitored and environmental and social responsibility issues to be identified; and
• Stakeholder reporting – policies, social and environmental initiatives, and compliance performance are reported internally and, where appropriate, externally.

Environmental and social responsibility-related regulatory requirements

MIIF is not aware of any material breaches of relevant environmental or social responsibility-related regulatory standards by its assets during the year ended 31 December 2008.

Environmental and social responsibility-related initiatives at MIIF assets during FY2008

Examples of notable environmental and social responsibility-related initiatives undertaken during the past financial year at assets in which MIIF invests include:

Arqiva

Arqiva has always taken a responsible approach to business practices, including areas such as community relations, disposal of waste at construction sites, development of a health and safety strategy, and maintaining good relationships with landowners.

Over the last year, Arqiva has developed its existing responsible approach to business practices with a more structured approach featuring key themes: community support and engagement, energy, environment, people, customers and suppliers. Policies and objectives for each theme have been developed and will lead to more structured programs and targets during FY2009.

However there have already been achievements, including:

Community support

Arqiva has sponsored the launch of schools radio, including the Arqiva schools radio award, and provides satellite distribution of Radio Lollipop, the children's entertainment initiative in hospitals.

Energy

Arqiva has developed an energy charter to guide its future policy on energy procurement and consumption, including future use of smart metering and procurement from renewable sources. An energy awareness campaign has been launched with the aim of reducing office electricity consumption by 10%. In Ireland, Arqiva already buys all its electricity from an Irish wind farm supplier. For its 12 largest TV sites, Arqiva has selected inductive output tube transmitters (post DSO) which will result in efficiencies of approximately 28–40%, as opposed to 15–20%, with alternative solid-state electronics.

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Hua Nan Expressway (HNE)

In 2008 HNE answered the various calls for aid in the natural disasters which hit China. In February, 97 HNE employees donated an aid package comprising of cash and equipment toward the relief efforts resulting from the severe snowstorms. A contribution was also made toward the relief efforts in the 12 May Sichuan earthquake, as 679 employees made a total donation of RMB75,192.

HNE designated December as a “Save Energy, Save the Environment†month. Senior management and department heads organised various seminars within their departments to educate employees on the benefits of creating a sustainable environment for living and working.

During the same month, a drive to collect used batteries was organised at toll stations. A bin was set up on traffic islands between toll stations so that drivers could drop off their used batteries. A system of exchange was set up at toll booths where drivers could exchange used batteries in return for a gift. In total, 2,200 used batteries were collected during December.

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Miaoli Wind (MWC)

The wind turbines associated with MWC are producing over 140,000MWh of electricity annually which is being placed on the Taiwan power grid. On average, this eliminates over 126,000 metric tonnes of carbon dioxide annually from the air in Taiwan.

MWC is working hard to be a “good neighbour†to the residents of Chunan and Dapong in the Miaoli County. MWC has established a financial feedback program in which it contributes NT$1.0 million annually to the local community for use in various development programs. MWC also installed public restrooms for residents in the Chunan area and provides satellite TV contracts for a number of residents living within the vicinity of the Dapong wind generators.

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Canadian Aged Care (CAC)

CAC's focus on the quality of care includes a commitment to ensuring a safe environment for residents, family members, visitors, volunteers and employees. CAC provides extensive education and training for its approximately 5,000 employees. In 2008 CAC provided a total of 9,119 hours of training across 83 topics related to resident care and staff development, including dementia care, infection control, fall prevention, customer service excellence and effective communications. The 83 topics include the 10 mandated for LTC homes by the Ontario Ministry of Health and Long-Term Care (MOHLTC).

In addition, each CAC home has a Joint Health and Safety Committee (JHSC). Members of each JHSC are certified every year in accordance with standards set by the Ontario Ministry of Labour. CAC conducts annual health and safety training, delivered by a provincially-certified OH&S provider, on topics ranging from emergency response, to personal protective equipment, to preventing workplace violence. 

In 2008 CAC launched an annual Award of Excellence program to honour and recognise employees that exemplify, reinforce and promote CAC's core values of Commitment, Communication, Teamwork, Respect and Learning. Each award winner received a C$1,000 monetary award, a commemorative statuette and a certificate. A C$500 donation was also made in each winner's name to a charity of their choice. The worthy organisations selected this year included Young Singers, the Children's Wish Foundation, Integra Foundation, the Alzheimer Society of York Region, Sick Kids Hospital Foundation, and Toronto General & Western Hospital Foundation – Adult Congenital Heart Disease Fund.

At a corporate level, CAC contributes annually to the Alzheimer Society of Ontario's annual Walk for Memories. In 2008, employees across CAC's 26 homes raised an additional C$6,800 for this important cause.

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Taiwan Broadband Communications (TBC)

TBC is committed to serving the community and promoting social values. Over the years TBC has built a track record of active participation in many varied community initiatives.

In 2008 TBC sponsored the Andrea Bocelli concert as part of promoting art and related events in Taiwan. In addition to this, TBC also sponsored the 228 Peace concert in order to commemorate the victims of the 228 Massacre in Taiwan and to educate the public on Taiwan's history.

TBC also provides air time and financial support for community announcements which promote public welfare issues, and subsidises subscriptions for low-income community members.

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Changshu Xinghua Port (CXP)

CXP continues to participate in a program aimed at improving the schooling provided to students of low socio-economic backgrounds within the Changshu city region. Further, CXP is currently in its sixth year of the management development program aimed at recruiting young graduates as trainees, in order to develop them for future management positions.

CXP contributed generously to the relief fund for the Sichuan earthquake and also to a welfare home in Changshu this year.

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