CIFI Asset Management (“CIFI AM”) is an investment firm entrusted with investors’ assets to act as their fiduciary on financing middle market private infrastructure projects in Latin America and the Caribbean. CIFI AM is the asset management affiliate of its parent company CIFI, which has been providing loans to projects in the region since 2001. CIFI AM provides investors diversified portfolio management services on direct infrastructure loans in high demographic growth areas while mitigating environmental, social, and governance (“ESG”) risks. CIFI and CIFI AM adhere to the Equator Principles and the IFC Performance Standards.
The European caught up with Ricardo Rico, Head of Funds and Javier Escorriola, Managing Partner, to find out more about the organisation.
- How do you perceive the current market landscape, and what key trends do you believe are shaping the asset management industry?
A very competitive one with plenty of liquidity and with an increasing market share from alternatives as an asset class. Other trends that are quite visible are energy transition, ESG focus and sustainability appetite from investors.
- Could you elaborate on your firm’s investment philosophy and how it guides your decision-making process for managing client assets?
ESG and sustainability oriented which translates in internal processes that use these criteria as filters and have mechanisms in place to identify and manage related risks. In addition, infrastructure is also the focus of the firm and given its long term nature the vehicles established for clients are closed and long term oriented. Finally, renewable energy is a core sector for CIFI for over 10 years. Now through Asset Management investor have the opportunity to participate in this investment sector with CIFI.
- With risk being an inherent aspect of investing, how does your firm approach risk management to safeguard client portfolios and achieve their financial objectives?
A holistic approach is used, that incorporates not only market, credit or operational risks but also environmental, social and corporate governance types of risks into the analysis of each operation from start to finish. Additionally, a project finance approach as opposed to a corporate finance approach has resulted in lower losses since problem management and anticipation of issues becomes possible and easier to implement.
- In an increasingly digital world, how is your firm leveraging innovative technologies to enhance the investment experience and deliver value to clients?
Most recent technological advances such as cloud computing, data analytics and storage, remote working, sharing drives, etc. have been embraced to ensure competitiveness and drive efficiencies and the expectation is to continue upgrades and use of new arriving technologies going forward.
- Environmental, Social, and Governance (ESG) factors have gained prominence in investment decisions. How does your firm integrate ESG considerations into your investment strategies?
Since the foundation of our company with multilateral banks and development finance institutions as shareholders, these elements have been an integral part of the analysis made of projects in which we invest. Currently, we have a department fully staffed which takes care of models, methodologies and different tools created in house and needed to carry out the analysis of ESG aspects. This team leads the implementation of such tools and methodologies to ensure risks are properly identified, measured, and mitigated throughout the whole investment cycle.
- How does your firm ensure a personalized and client-centric approach to asset management, catering to the unique financial goals and preferences of your diverse clientele?
We have dedicated personnel to investor relations function and keep a close communication with our investor base to ensure a proper service and full satisfaction of their needs. We have identified a niche of investors we are focused on, which includes several key industry players with whom we have forged strong relationships that go back many years and cover several areas of finance including asset management and investments.