Community

Environmental and social responsibility (ESR) Management

Macquarie Group (Macquarie) manages a range of investment vehicles within Macquarie Capital. Macquarie Atlas Roads is one of these vehicles. Macquarie has made a public statement on corporate citizenship which is available on its website. The 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 all Macquarie staff, which has been adopted by MQA and which is set out in Code of Conduct.
• A robust framework of policies including those relevant to environmental, social and governance (ESG) responsibilities.

In addition, Macquarie recently committed to becoming carbon neutral across its global offices and corporate air travel by December 2010.

Responsibility

All Macquarie staff, including those working on behalf of Macquarie Atlas Roads, have a collective responsibility to ensure that Macquarie continues to be a good corporate citizen. MQA management 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 or finances to community organisations through the Macquarie Group Foundation.

MQA

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

MQA has adopted a policy and procedures to manage these risks which is consistent with Macquarie’s policies and that reflects the risk specifically associated with management of and investment in infrastructure assets. This policy forms part of MQA’s overarching risk management framework in accordance with Principle 7 of its corporate governance statement. See MQA’s website.

The framework is applied throughout MQA’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
• Stakeholder reporting – policies, social and environmental initiatives and compliance performance are reported internally and, where appropriate, externally.

In this section we provide details of MQA’s environmental and social responsibilities and initiatives undertaken during FY2009. MQA’s governance responsibilities and policies are covered in pages 23 to 43.

In addition to MQA’s own processes and policies, many new infrastructure projects undergo extensive social and environmental impact reviews before being given approval to proceed. The process is typically run by governments, which will have balanced the costs and benefits of the project. Accordingly, a government-run process will usually require new infrastructure to produce more efficient environmental outcomes than existing alternative infrastructure; or, where an investment is made in existing infrastructure, for that investment to produce improved environmental outcomes over those that existed prior to the investment being approved.

ESR-related initiatives at MQA assets during FY2009

Environmental initiatives

Indiana Toll Road

In October 2008 the Roadway Maintenance Department of the ITR Concession Company made improvements to its fleet of maintenance vehicles and snow ploughs. The company invested more than US$7 million on the new vehicles, including 15 new pickup trucks in mid-October 2008 and new ploughs to replace its ageing fleet of previous ploughs. The new maintenance vehicles represent a substantial improvement over the trucks previously in use, with better features and greater fuel efficiency, making them more environmentally friendly. In addition, the new ploughs’ features include reversible front ploughs, reversible underbody ploughs, air-flow multi-purpose dump beds, Force-America ground speed controls, 90-gallon pre-wet liquid tanks, and surface air-temperature sensors.

M6 Toll

Responding to the challenge of climate change, M6 Toll commissioned a report on carbon emissions from Staffordshire University. M6 Toll is also working with Carbon Trust, an independent company set up in 2001 by the government in response to the threat of climate change, to ensure that their practices are carbon efficient. This work is welcomed by the Highways Agency.

Autoroutes Paris-Rhin-Rhône

APRR spent €15.5 million on environmental projects during the period, notably for water protection and acoustic protection at 48 noise trouble spots. This is a significant increase from the €11.3 million spent in 2007. In connection with the widening of the A31 motorway, 18 purpose-built crossings for animals were built along the motorway boundaries, bringing the total to 144 over the network. APRR is currently working towards certification of its environmental management system under ISO 14001.

ESR-related initiatives at MQA assets during FY2009

Social responsibility initiatives

Drive for Charity

Drive for Charity is an initiative where, each year on certain roads, a day’s toll proceeds are collected and distributed to charitable and not-for-profit organisations that provide assistance and services to the communities in which the roads operate. A strong sense of goodwill has developed around the initiative, with drivers often donating more money than the normal toll, and the roads’ staff joining in to raise money for the worthy causes.

This year MQA was proud to support Drive for Charity on Dulles Greenway and South Bay Expressway in the US.

Dulles Greenway – 21 May 2009

This is the fourth year that Dulles Greenway has participated in the annual Drive for Charity event. In 2009 more than US$233,000 was donated to six local organisations through tolls and the assistance of Greenway sponsors within the local business community, bringing the total amount raised through the event to over US$800,000.

Drive for Charity is built around three-year funding relationships and this year’s recipients will receive funding in 2009, 2010 and 2011. The organisations which have benefitted from the event in 2009 are:

• The March of Dimes, whose mission is to improve the health of babies by preventing birth defects
• Every Citizen Has Opportunities (ECHOworks), which offers comprehensive, individualised employment, vocational training and community integration opportunities for persons with disabilities in the Northern Virginia area
• Loudoun Abused Women’s Shelter, which provides emergency accommodation, food and emotional support to women and their children escaping domestic violence and abuse
• Fresh Air/Full Care, which provides funding for summer camps for at-risk youth
• Loudoun Wildlife Conservancy, which promotes the preservation and proliferation of healthy wildlife habitats
• Dulles Greenway Scholarship Program, which provides 13 US$1,000 scholarships to local students.

South Bay Expressway – 25 November 2008

Drive for Charity was held for the first time this year. US$30,000 was raised and donated to Endow Chula Vista, a city-wide endowment fund that supports non-profit community organisations and activities.

SBX is actively involved in the communities it serves. Members of SBX’s management team participate as officers, board and committee members of the South Bay Family YMCA, San Diego Regional Chamber of Commerce, South County Economic Development Council, and many other community organisations. SBX employees also regularly contribute volunteer time and financial support to community non-profit organisations such as South Bay Community Services, the International Friendship Games, Chula Vista Educational Foundation, local service organisations such as Rotary International and Kiwanis and youth sports leagues. Each month SBX employees select a local non-profit charity and contribute to that charity in exchange for Friday Jeans Days.

407 ETR

407 ETR conducted several fundraising events and contributed to numerous local charities during the year. Charitable donations included C$30,000 to the annual SickKids Radiothon, which supports Toronto’s Hospital for Sick Children, and more than C$95,000 to the United Way, which works to improve local living conditions and to strengthen the local community. 407 ETR also contributed through fundraising to the James Fund and to pediatric brain cancer research, and continues to provide one C$15,000 scholarship to a York University student.

Additionally, over 15 local junior sports teams received sponsorship from 407 ETR during the period, as well as a number of sporting events, including the Rogers Cup Tennis tournament.

Indiana Toll Road

The ITR Concession Company (ITRCC) donated approximately 15 cents for every vehicle that used the toll road over the 4th of July three-day holiday weekend. With more than 135,000 vehicles using the road, over US$20,000 was raised for the Indiana National Guard Relief Fund. Since 2003, the fund has provided financial grants to the men and women of the Indiana National Guard and their families who are challenged by financial hardships while soldiers are on active duty away from home.

In July 2008 ITRCC donated more than US$6,000 to the Indiana Troopers Association (ITA), stemming from a charity golf day. The donation will go to a fund dedicated to providing and maintaining memorials to the troopers who have died in the line of duty. Included in this group of memorials are two locations, westbound and eastbound on the Indiana Toll Road. Each year during May the ITA provides memorial flags for the commemoration.

The ITRCC has donated more than US$12,500 to local organisations since July 2008. These include Pop Warner football, area Chambers of Commerce, local fire departments, YMCA, the Muscular Dystrophy Association, the Center for the Homeless and also little league team sponsorships.

Chicago Skyway

Chicago Skyway has donated more than US$20,000 to various charities throughout the Chicago area since June 2008, including After School Matters, a non-profit organisation that assists teens in becoming paid apprentices or club members in arts, sports, technology and communications programs, and also the Black Creativity Gala, Chicago’s premiere social gathering at the Museum of Science and Industry, in celebration of Black History Month.

In September 2008 Chicago Skyway donated US$10,000 to the Illinois Military Family Relief Fund in observance of Patriot’s Day in 2008.

Chicago Skyway has provided more than US$3,000 to elementary schools located in the wards through which the Chicago Skyway runs, in an annual art contest, ‘Skyway in the Springtime’. Students were invited to draw their interpretations of the Skyway Bridge as it leads up to springtime. The grand prize winner received US$200 for himself, US$500 for his respective school, and the student’s artwork was displayed during the month of April on the Chicago Skyway toll plaza.

Warnow Tunnel

Warnow Tunnel is a sponsor of various social organisations in the community, helping disadvantaged people as well as students and senior citizens. Warnow Tunnel has sponsored Rostock Food for People since 2004, an organisation which collects food nearly past its due date and then distributes it to people in need in the region. Warnow also donates prizes for a student competition organised by the National Office for Environment and Nature.

South Bay Expressway

During the period SBX undertook several environmental mitigation activities. Onsite biological habitat restoration, including native plant revegetation, occurred at two major river crossings. In addition, offsite habitat restoration at the 52-acre mitigation site proceeded smoothly. Several endangered species have been sighted within the mitigation area and appropriate measures have been taken to protect their habitat.

SBX is working closely with local government agencies for vector (mosquito) control in and around storm drain basins, which has become a regional public health concern due to the potential spread of the West Nile virus. Water quality testing and monitoring efforts continue, ensuring roadway pollutants in storm water runoff are reduced to acceptable levels.

Landscaping along the roadway incorporated water conservation measures such as drought tolerant plants and the use of recycled water for irrigation.