RC5: Nature of Entity's Business
Maximum Score
Not scored
Prefill
Eligible
Validation
Evidence is not required
2026 Updates
None
The structure of the entity's core business is:
Assessment Instructions
Intent: What is the purpose of this indicator?
Describe the structure and business risk of the participating entity. The scope of service of the entity influences materiality (see guidance in RC7 and the GRESB Materiality Tool for more details).
Input: How do I complete this indicator?
Structure: Select whether the entity’s structure is that of a Corporate, a Special Purpose Vehicle or some other structure (if so, then please describe).
Business Risk (Revenue basis): Select the most significant business risks (or revenue basis) borne by the entity being Merchant, Concessionary/Contracted, Regulated, or Other. More than one selection (i.e. a combination) is allowed. This aligns with the EDHECinfra™TICCS™ classification for Business Risk. Multiple answers are possible. For ‘Other’ answer, describe the business risk borne.
Scope of Service: Select whether the entity provides associated services in addition to providing the asset itself. The associated services may be Asset Maintenance and/or Asset Operation. This section then determines whether the Scope of Service provided by the entity is:
Asset provision
Asset provision and maintenance
Asset provision and operation
Asset provision, maintenance and operation.
This information is used for materiality-based scoring and to determine the entity’s peer group for benchmarking and reporting purposes.
Terminology
Asset maintenance
All actions necessary for retaining an asset as near as practicable to its original condition, but excluding rehabilitation or renewal. Maintenance does not increase the service potential of the asset or keep it in its original condition, it slows down deterioration and delays when rehabilitation or replacement is necessary.
Asset operation
The active process of utilizing an asset, which will consume resources such as manpower, energy, chemicals and materials.
Asset provision
The act of owning and making an asset physically available for operational and maintenance activities by the organization’s private parties or any other third-party (e.g contractors). Asset provision can also include design & construction, work typically done on Greenfield Assets. For classification purposes, Greenfield Asset developers should see themselves as Asset providers.
Concessionary/Contracted
A contracted infrastructure organization that enters into a long-term contract to presell all or most of its output at a pre-agreed price. All or the majority of market risk (price and/or demand) is transferred to a third party. The contract is for a significant period of the investment’s life, typically one or several decades.
Corporate
A corporate structure is that of a legal entity that is separate and distinct from its owners. Corporations have limited liability, which means that shareholders may take part in the profits through dividends and stock appreciation but are not personally liable for the company's debts.
Merchant
An organization that collects fees and tariffs from end users as a function of the effective demand for the provided service. The organization is mostly or fully exposed to market risks (price and demand risk).
Public Entity
A company that is publicly listed and traded on a recognized stock exchange such as Nasdaq or NYSE.
Regulated
An organization whose business is regulated by government agencies via limits on tariffs, rate of returns, or revenues. Also referred to as discretionary regulation.
Special Purpose Vehicle (SPV)
A subsidiary entity with an asset/liability structure and legal status that makes its obligations secure.
Scoring
This indicator is not scored.
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