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Founded in Singapore exactly 50 years ago, Temasek is perhaps the world’s most sustainable sovereign wealth fund.
Comprised primarily of companies directly owned by the Singapore government and founded with US$354 million, Temasek has transformed from an island holding company to a global investor with a diversified portfolio now worth US$382 billion. Did.
From the outset, Temasek built its investment strategy on the founding principles of modern Singapore, including financial discipline and a long-term perspective.
These days, sustainability means putting capital into companies and industries that enable growth and a more sustainable future.
Temasek has identified four megatrends that will impact your long-term portfolio strategy.
- digitalization
- the future of consumption
- Long life
- sustainable living
Temasek is tackling the sustainable living megatrend by investing in innovative early stage companies and technologies that help achieve decarbonisation. Investors also work closely with portfolio companies to drive their own decarbonization efforts and identify ways in which companies can become more sustainable.
This net zero initiative focuses specifically on energy, mobility, built environment and manufacturing solutions.
Temasek Holdings chairman Lim Boon Heng said the company’s objectives remained steadfast despite the challenging circumstances of recent years due to turmoil and geopolitical tensions.
“Climate change remains an existential threat and time is running out to address it,” he said.
“Businesses and governments can no longer sit on the sidelines. Businesses cannot succeed unless societies thrive, so we all must play an active role in solving common global challenges.
“Temasek’s purpose – that every generation thrives – is our north star. Our purpose is embedded in everything we do, and we strive to create a better, more inclusive and sustainable world. We ensure we do our part to build.”
What is Temasek’s sustainable investment strategy?
Returning to these four megatrends, Temasek said digitalization and sustainable living will impact all sectors and business models, both established and start-ups.
The future of consumption and longer lifespans reflects changes in society and consumer demands due to population growth and longer expected lifespans.
Because the four trends are interconnected and global, Temasek will invest in companies that “enable, drive and benefit from these trends”.
Temasek is not “staking” large sums of money on silver bullet solutions to the climate crisis, but it is investing small amounts in innovative start-ups. Of course, the risks are higher, but the rewards can also be greater.
This is a smart approach, and one that has clearly served Temasek well over the past half century.
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