Asset Management: Making Better Infrastructure Investment Decisions
First coined by Australian economist Dr. Penny Burns in 1984, the term "asset management" is now widely used in the municipal sector to focus on physical, rather than financial assets. "Infrastructure management" is sometimes used to mean the same thing. Municipal asset management can include all physical infrastructure assets managed by the municipality, including roads, bridges, water, wastewater, buildings, fleet, recreational facilities and equipment, natural assets, and public safety assets.
In 2009, the Canadian National Asset Management Working Group of the National Round Table on Sustainable Infrastructure developed An Asset Management Governance Framework for Canada as a foundation for a sustainable infrastructure management practice. The framework defines asset management as:
"An integrated business approach involving planning, finance, engineering and operations to effectively manage existing and new infrastructure to maximize benefits, reduce risk and provide satisfactory levels of service to community users in a socially, environmentally and economically sustainable manner."
The framework identifies community sustainability as the core objective of asset management — building environmental, financial and social resilience and adaptability to face a changing world.
Asset management is still a relatively young discipline. While some Canadian municipalities and provinces have made advances, effectively incorporating asset management into strategic management systems at the corporate level is still uncommon.
There are significant social, environmental and economic gains to be made by helping to support municipal asset management practice in Canada. In applying it, communities across Canada will be better positioned to make their infrastructure dollars go further, with a lighter environmental footprint.
FCM has developed the GMF Leadership in Asset Management Program to help strengthen asset management in Canadian municipalities and support innovation in aligning its practice with municipal sustainability goals.