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1、SkTemasek Review 2024 Homepage1SkContent Overview0.Homepage1.With Tomorrow in Mind2.From Our Chairman3.Performance&Portfolio4.Sustainability5.Institution1.1 Preface1.2 The Temasek Charter3.1 Performance Overview3.2 Portfolio Highlights3.3 Investment Approach3.4 Investment Update3.5 Major Investments

2、3.6 Credit Profile3.7 Managing Risks4.1 Sustainability Overview4.2 Advancing Sustainability Through Our Portfolio4.3 Building a Sustainable Organisation5.1 Governance&Leadership5.2 Compensation Philosophy5.3 Our People5.4 Community StewardshipCopyright 2024 Temasek Holdings(Private)LimitedTemasek Re

3、view 2024 Content Overview2From Our Chairman“We must continue to build and innovate as wetap into new and emerging opportunities whilescaling new heights in a changing world.Onlywith courage and conviction,can we help tobuild a better,more inclusive,and sustainableworld for this and future generatio

4、ns.”LIM BOON HENGChairmanREAD MORETemasek Review 2024 Homepage3Performance&PortfolioTemasek Review 2024 Homepage4Performance OverviewWe ended the year with a net portfolio value of S$389 billion.Marking our unlisted portfolio to market would provide S$31 billion of value uplift and brings our net po

5、rtfoliovalue to S$420 billion.READ MORES$389bNet portfolio valueUp S$166 billion over the last decadeS$328bInvested during the decadeInvested S$26b during the year6%10-year return to shareholderTotal shareholder return of 14%since inceptionS$9bDividend incomeAverage annual dividend income of S$9 bil

6、lion overthe last decadeTemasek Review 2024 Homepage5Portfolio HighlightsAnchored in Asia,our portfolio has 64%underlying exposure to developed economies.READ MORE20242023202253545413151553322217161710109SingaporeChinaIndiaAsia Pacific(ex Singapore,China&India)AmericasEurope,Middle East&Africa202420

7、232022272827192222766121112222121131212SingaporeChinaIndiaAsia Pacific(ex Singapore,China&India)AmericasEurope,Middle East&AfricaTemasek Review 2024 Homepage6Investment UpdateConsistent with past years,we continued to deploy capital into opportunities aligned with the four structural trends and our

8、sustainability objectives.We de-risked certainpositions and realised gains from earlier investments.This will allow us to recycle our capital,and to take advantage of market dislocations and unique investmentopportunities,as and when they arise.READ MORETemasek Review 2024 Homepage7SustainabilityOur

9、 commitment to sustainability is integral to building a thriving and resilient portfolio that enables us to deliver sustainable returns over the long term.We have been advancing our net zero efforts through decarbonising our existing portfolio,making new investments,forging partnerships,and building

10、 platforms.Temasek Review 2024 Homepage8READ MORETowards Net ZeroTemasek Review 2024 Homepage9InstitutionWe strive to do well,do right,and do good,to build a brighter and more inclusive tomorrow for this and future generations.At the core of this ambition is our people theirvalues,passions,capabilit

11、ies,and their willingness to learn,contribute,lead,and take on new ideas and responsibilities.READ MORETemasek Review 2024 Homepage10Making a DifferenceOur journey in building social capital started over20 years ago,when we adopted a deliberate andstructured approach to give back tocommunities.Learn

12、 how we support ground-up initiatives suchas Canine Partners to foster meaningfulconnections with our community.READ MORECopyright 2024 Temasek Holdings(Private)LimitedTemasek Review 2024 Homepage11SkWith Tomorrow in Mind1.1 PrefaceOur world has changed.We now live in an era of competition and confl

13、ict.Geopolitical tensions have intensified,amidst the possibility of persistent inflation and higher rates for longer,growing nationalism,populism,and protectionism.At the same time,the climate crisis looms.To advance forward,we have developed our T2030 strategyto build a resilient and forward-looki

14、ng portfolio,with sustainability at our core.Our journey is driven by a sense of purposeto do well,do right,and do good.At 50,we draw on lessons from our pastand look ahead to the future with courage and conviction.We remain resolute in our commitmentto always do things today with tomorrow in mind,S

15、o Every Generation Prospers.Temasek Review 2024 1.With Tomorrow in Mind 1.1 Preface121.2 The Temasek CharterTemasek is a global investment company rooted in Singapore.Operating on commercial principles,we deliver sustainable returns over the long term.As stewards of our assets,we engage our portfoli

16、o companiesto enhance shareholder value and advocate good governance practices.Together,we contribute to the uplifting of the communitiesin which we operate.We invest in human potential,build with courage,and catalyse solutions,with sustainability at the core of what we do.In all these,we seek to Do

17、 Well,Do Right,and Do Good.Doing things today with tomorrow in mind,So Every Generation Prospers.Copyright 2024 Temasek Holdings(Private)LimitedTemasek Review 2024 1.With Tomorrow in Mind 1.2 The Temasek Charter13SkFrom Our ChairmanTo adapt to a changing world,we draw on lessons from our past and lo

18、ok ahead to the future with courage andconviction.2024 is a special year for Temasek as we commemorate 50 years since our inception in 1974.We are marking this significant milestoneat a time when the world is deeply divided.Over the past three decades,we had enjoyed global peace and stability with f

19、ree trade and global collaboration,albeit interspersedwith events that included the SARS epidemic and COVID-19 pandemic.Unfortunately,we have now entered a new era of conflict andcompetition with ongoing wars in Ukraine and Gaza,and intensifying US-China tensions against the backdrop of a rise in po

20、larisation,populism,nationalism,and protectionism in a number of countries.We have seen the emergence of muscular industrial policies which nations have introduced to enhance domestic competitiveness,create jobs,and protect the livelihoods of their citizens.At the same time,the climate crisis contin

21、ues to loom large,with the windowfor action rapidly narrowing each year.These have wide-ranging implications on companies around the world and exacerbate theuncertainty of the macro environment.Interestingly,this harks back to the era in which we were founded,back in 1974 when the world was divided

22、similarly by geopoliticaldifferences and faced similar challenges to those we are witnessing today.Understanding the journey that led us to where we areWe must continue to build and innovate as we tap into new and emergingopportunities while scaling new heights in a changing world.Only withcourage a

23、nd conviction,can we help to build a better,more inclusive,andsustainable world for this and future generations.LIM BOON HENGChairmanTemasek Review 2024 2.From Our Chairman14today is important to help prepare us for the future.It also gives renewed meaning to Temaseks ethos of doing things today wit

24、htomorrow in mind,so every generation prospers.Temasek is a much bigger entity than it was in 1974.However,one thing remains constant,we must continue to build and innovate aswe tap into new and emerging opportunities while scaling new heights in a changing world.Only with courage and conviction,can

25、 wehelp to build a better,more inclusive,and sustainable world for this and future generations.Portfolio PerformanceAs at 31 March 2024,our net portfolio value was S$389 billion,up S$7 billion from the previous year,largely due to our returns in theUS and India,offset by the underperformance of Chin

26、as capital markets.Amidst the global economic uncertainties,we maintained a cautious investment stance,and invested S$26 billion and divested S$33billion in the financial year ended 31 March 2024 with a net divestment of S$7 billion.This is compared to our net investment of S$4billion in the last fi

27、nancial year.Our 10-year and 20-year Total Shareholder Return(TSR)were 6%and 7%respectively.One-year TSR was 1.60%.TSR since inception in1974 was 14%.On a mark to market basis,our net portfolio value as at 31 March 2024 would have been S$420 billion,including a valueuplift of S$31 billion from our u

28、nlisted portfolio.The resilience of our portfolio remains our core strength.We will continue to shape our portfolio in line with long-term structuraltrends,with the aim of achieving sustainable returns over the long term.Navigating a Complex WorldThe global economy has been more robust than expected

29、.Recession risks in key developed markets have largely subsided,aspolicymakers navigated an eventful 2023.While monetary policy remains tight globally,we are seeing inflation coming down fromelevated levels.This has given central banks more confidence to potentially ease monetary policy,with some al

30、ready beginning theprocess.Despite the better growth outlook,there are risks on the horizon.Geopolitical tensions are a key concern primarily centred ontense US-China relations,and the wars in Ukraine and Gaza.The elections in the US and other countries this year could add anadditional layer of comp

31、lexity to the risk-reward spectrum.In the US,inflationary pressures have broadly eased,even as growth has remained firm.Expansionary supply factors,especially higherimmigration flows,have made this possible by adding to the labour force and the economys overall growth capacity.However,thetrajectory

32、towards the Federal Reserves inflation target of 2%remains uncertain.An unclear inflation path,a resilient labour market,and continued growth suggest less need for the Federal Reserve to pre-emptively ease its restrictive monetary policy,potentiallyleaving policy rates higher for longer.If inflation

33、 turns out to be more persistent than expected,the odds of further hikes may increasewhich may result in headwinds to financial markets.The Eurozone economy is recovering.Domestic consumption is supported by credit growth and a pickup in real wages as inflationslows.This has allowed the European Cen

34、tral Bank to normalise policy.In addition,the global manufacturing cycle has troughed,forming another growth tailwind.However,we are watchful for downside risks in the form of a less supportive fiscal impulse.In thelong term,there remains scope for significant infrastructure build out across Europe

35、because of the energy transition.This createsopportunities to invest in quality businesses that benefit from increased capital expenditure in green technologies.1 Equivalent to US$288 billion,267billion,228 billion,and RMB2.08 trillionas at 31 March 2024.1Temasek Review 2024 2.From Our Chairman15Chi

36、nas government has set a target of around 5%economic growth for 2024,which is the same as last year.The government maintainsa pro-growth policy stance.This has aided China in recovering from a cyclical bottom in growth but structural challenges remain.Diversification plans by global multinational co

37、rporations and reduced foreign direct investment could lower the potential forproductivity gains.Chinas supply capacity remains highly competitive and efficient,but without a commensurate pickup in domesticdemand,growth and inflation will continue to face downward pressure.At the same time,geopoliti

38、cal tensions and threats of additionaltariffs could weigh on export demand for Chinese goods.Singapores open economy is expected to be supported by a healthy external growth backdrop and continued recovery in the globalgoods cycle.However,geopolitical events and conflicts pose risks.We remain watchf

39、ul over any potential disruption to global trade andsupply chains which could disproportionately impact Singapore.Commemorating Our 50 AnniversaryTurning 50 is an opportunity to reflect on our journey and prepare for the road ahead.To guide us to realise our Purpose So EveryGeneration Prospers,we ha

40、ve refreshed the Temasek Charter,which is a living document that we review and update at different phasesof Temaseks journey.The refreshed Charter sets out our role as a global investor rooted in Singapore,to deliver sustainable returnsover the long term.To move forward,we have developed our T2030 s

41、trategy to build a resilient and forward-looking portfolio,withsustainability at our core.In June 2024,we announced T-Spring,a S$150 million gift to the community to advance capabilities and contribute to preparingSingapores workforce and organisations to embrace a different world.The gift which sup

42、ports skills development,scholarships,andfellowships is Temaseks tribute to Singapores past,present,and future generations on our 50 anniversary.It reflects ourintergenerational focus,underscores our roots,and acknowledges human capital as the driver of our journey and its role in Singaporessuccess.

43、Extending Our Global FootprintTemaseks growth is a story of globalisation.In 1974,we had a portfolio of 35 Singapore companies and since then we have grown intoa global investment house with 13 offices in 9 countries around the world.In April this year,we held the official opening of our Paris offic

44、e,reaffirming our commitment across the broader Europe,Middle East,and Africa(EMEA)region.Our exposure to the EMEA region has grown almost five times since 2011,reflecting the opportunities andinnovation we see there.Our Paris office will complement our London and Brussels offices to strengthen Tema

45、seks global network.Inaugural Sustainability ReportAs we continue to adapt to a changing world,our commitment to placing sustainability at our core remains.This year,we launched ourinaugural Sustainability Report.It brings together our disclosures and tracks our progress,by taking into consideration

46、 the disclosurerequirements issued by the International Sustainability Standards Board.As a company,we uphold our commitment to carbonneutrality in our operations.We also remain committed to our strategy for net zero,nature positive,and inclusive growth.ththTemasek Review 2024 2.From Our Chairman16I

47、n AppreciationI am grateful to our international and regional advisors,who have always been generous with their insights and advice.Last year,welaunched the Temasek Southeast Asia Advisory Panel(TSEAP),which comprises eminent business leaders with deep experience,insights,and perspectives on signifi

48、cant industry,economic,social,and political trends in the region.Together with the TemasekAmericas Advisory Panel and the Temasek European Advisory Panel,TSEAP will complement the Temasek International Panel inproviding Temasek with regular access to and engagement with prominent business leaders on

49、 issues relevant to our activities acrosskey markets.I am also deeply appreciative to my colleagues on the Board for their tireless and generous contributions that enable us to navigatethe challenges ahead.I wish to take this opportunity to welcome Tan Chong Meng and Geoffrey Wong who joined our Boa

50、rd on 1 April2024 and 10 May 2024 respectively.Both are senior business leaders with extensive global experience in their respective fields.ChongMengs 40-year executive career has spanned both private and public service.His track record of driving commercial growth in diverseglobal markets will be i

51、nvaluable in guiding the Temasek team to navigate the complex operating environment.Geoffrey has a longcareer in investment management,especially in the Asia Pacific and emerging markets.His deep investment experience in equities andother asset classes,as well as in the areas of investment managemen

52、t and governance,will help to strengthen our board andinvestment deliberations.We look forward to tapping on their guidance and counsel.My message started with a sombre picture of our world.However,I am optimistic that we will weather the storm and emerge stronger.I say this with conviction as our h

53、istory is proof that we have what it takes to overcome a challenging environment.Many of the issuesthat we are dealing with today were present in 1974,such as high inflation and interest rates,the global oil crisis,the Cold War,and afragmented global economy.We surmounted those headwinds 50 years ag

54、o and thrived.We will rise above the challenges that havecome back to revisit us and may stay with us well past the end of the decade.Finally,I would like to thank our people who have been instrumental to Temaseks journey.I am grateful to the boards,management,and staff of Temasek and our portfolio

55、companies past and present for their contributions over the past 50 years.They have putus in good stead by always doing things with tomorrow in mind.We will strive to continue their good work and stay committed to doingwell,doing right,and doing good,so that every generation prospers.LIM BOON HENGCh

56、airmanJuly 2024Copyright 2024 Temasek Holdings(Private)LimitedTemasek Review 2024 2.From Our Chairman17SkPerformance&PortfolioTemasek Review 2024 3.Performance&Portfolio183.1 Performance OverviewWe ended the year with a net portfolio value of S$389 billion.Marking our unlisted portfolio to market wo

57、uld provideS$31 billion of value uplift and brings our net portfolio value to S$420 billion.23S$389bNet portfolio valueUp S$166 billion over the last decade(as at 31 March)Net Portfolio Value(S$b)Equivalent to US$288 billion,267billion,228 billion,and RMB2.08 trillionas at 31 March 2024.2 Applying a

58、 similar methodology,marking our unlisted portfolio to marketwould bring our net portfolio value toS$411 billion and S$438 billion for thefinancial years ended 31 March 2023 and2022 respectively.3Temasek Review 2024 3.Performance&Portfolio 3.1 Performance Overview19Our portfolio comprises both liste

59、d and unlisted investments.Our net portfolio value of S$389 billion is based on valuing our listed investments at share prices as of the last trading day of ourfinancial year and our unlisted investments at book value less impairment.Book value refers to Temaseks cost of investment plus ourshare of

60、the investee companys profits or losses,changes in other equity reserves,minus write down(if any).Over the last decade,our unlisted portfolio generated returns of 9%per annum,delivering higher returns than our listed portfolio.Marking our unlisted portfolio to market,based on market approaches such

61、as investee companys recent funding round,marketmultiples of comparable public companies,and/or income approach such as the discounted cash flow model,would provide S$31billion of value uplift,which is approximately 15%of our unlisted portfolio as at 31 March 2024.Temasek Net Portfolio Value since I

62、nceptionMarket valueShareholder equityShareholder equity excluding mark to market movement Incorporation of Temasek on 25 June 1974.Financial year 75 began on 25 June 1974 and ended 31 December 1975.Financial year-end was changed from 31 December before 1993 to 31 March from 1994 onwards.From the fi

63、nancial year ended 31 March 2006,the accounting standards require sub-20%investments to be marked to market.41234Temasek Review 2024 3.Performance&Portfolio 3.1 Performance Overview20S$26bInvested during the yearInvested S$328 billion over the last decade(for year ended 31 March)Investments&Divestme

64、nts(S$b)InvestmentsDivestmentsTemasek Review 2024 3.Performance&Portfolio 3.1 Performance Overview21Total Shareholder Return(TSR)is a compounded and annualised measure,which includes dividends paid to our shareholder andexcludes investments made by our shareholder in Temaseks shares.Our TSR over dif

65、ferent time periods is a snapshot of ourperformance,with the longer time periods being more representative of our performance as a long-term investor.As at 31 March 2024,our Singapore dollar 10-year TSR was 6%and three-year TSR was 0.68%.Our 20-year TSR was 7%,versus the Singapore 20-year annualised

66、 core inflation of 1.9%.6%10-year return to shareholderTotal shareholder return of 14%since inception(as at 31 March 2024)S$Total Shareholder Return(%)Period in years Total Shareholder Return in US$terms was 5%,8%,and 15%for 10,20-year,and since inception periods respectively,based on historical for

67、eign exchange rates.1145 Total Shareholder Return in US$termswas 1%,5%,and 8%for 3,10,and 20-year periods respectively,based onhistorical foreign exchange rates.4 As of the year ended March 2024,annualised core inflation in Singaporewas 1.7%and 1.9%for 10 and 20-yearperiods respectively(Source:Monet

68、aryAuthority of Singapore).5Temasek Review 2024 3.Performance&Portfolio 3.1 Performance Overview227%20-year return to shareholderOne-year returns of-9%to 25%during the last decade(as at 31 March)Rolling S$Total Shareholder Return(%)One-year10-year20-yearTemasek Review 2024 3.Performance&Portfolio 3.

69、1 Performance Overview23S$9bDividend incomeAverage annual dividend income of S$9 billion over the last decade(for year ended 31 March)Dividend Income(S$b)Temasek Review 2024 3.Performance&Portfolio 3.1 Performance Overview243.2 Portfolio HighlightsAnchored in Asia,our S$389 billion portfolio has 64%

70、underlying exposure to developed economies.(as at 31 March)62024 2023 2022 2021 2020 2019 2018 2017 2016 2015535454495255546060571315152123202019202153332223222222345455171617151211128771010910887668SingaporeChinaIndiaAsia Pacific(ex Singapore,China&India)AmericasEurope,Middle East&Africa2024 2023 2

71、022 2021 2020 2019 2018 2017 2016 201527282724242627292928192222272926262525277665454555121112121415181719192221212018161414121113121212111211101010 Distribution based on underlying assets.SingaporeChinaIndiaAsia Pacific(ex Singapore,China&India)AmericasEurope,Middle East&Africa1 Equivalent to US$28

72、8 billion,267billion,228 billion,and RMB2.08 trillionas at 31 March 2024.6Temasek Review 2024 3.Performance&Portfolio 3.2 Portfolio Highlights252024 2023 2022 2021 2020 2019 2018 2017 2016 201522232219181919202122212123242325262523281817182121202123252415161514171716171715999108764439888888875665454

73、4333 Distribution based on underlying assets.The Transportation&Industrials sector includes investments in Energy&Resources.Transportation&Industrials2Financial ServicesTelecommunications,Media&TechnologyConsumer&Real EstateLife Sciences&Agri-FoodMulti-Sector FundsOthers(including Credit)122024 2023

74、 2022 2021 2020 2019 2018 2017 2016 201529272838373636333134998751010910121011121010121518202152535245484239403933 Mainly cash and cash equivalents,and sub-20%listed assets.Liquid&sub-20%listed assets1Listed large blocs(20%and 3.Performance&Portfolio 3.2 Portfolio Highlights262024 2023 2022 2021 202

75、0 2019 2018 2017 2016 201555544950576353605858303034312621241919145771111101212131543322222222111146654487810 Distribution based on currency of denomination.Less than 1%.Singapore dollarsUS dollarsHong Kong dollarsIndian rupeesEuros0202020202Others122024 2023 2022 2021 2020 2019 2018 2017 2016 20155

76、211*111011976332*101111141191088*656865633*616970687580818687*The increase in our Sustainable Living exposure is mainly due to a reclassification of selected portfolio companies as at 31 March 2024,to better reflect their alignment with the trend.Less than 1%.Information not measured in previous yea

77、rs.We have been aligning our portfolio to structural trends since 2016.Sustainable Living12102020202DigitisationFuture of ConsumptionLonger LifespansOthers12*Temasek Review 2024 3.Performance&Portfolio 3.2 Portfolio Highlights272024 2023 2022 2021 2020 2019 2018 2017 2016 201510101113128866577897654

78、346668655443555577777633322211168686763667274798082 Less than 1%.TechnologyNon-Bank Financial ServicesLife SciencesConsumerAgri-Food010101Media0101010101010101Others1Temasek Review 2024 3.Performance&Portfolio 3.2 Portfolio Highlights283.3 Investment ApproachOur investments are driven by our views o

79、f the trends shaping societies.Since our incorporation in 1974,Temasek has transformed from a Singapore holding company into a global investment company.Inthe 2000s,we stepped out and grew with an emerging Asia.In 2010,we embarked on our strategy to be a global investor by the end of2020,and expande

80、d beyond investing in emerging markets and Asia,to developed markets in the US and Europe.In 2019,Temasek developed our T2030 strategy our 10-year roadmap to guide our strategic planning,capability building,andinstitutional development initiatives for this decade.As part of our T2030 strategy,we foc

81、us on constructing a resilient and forward-looking portfolio one which is able to withstand exogenous shocks and perform through market cycles,while at the same timecapitalising on growth opportunities with the potential for sustainable returns above our risk-adjusted cost of capital over the longte

82、rm.Portfolio CompositionStructural TrendsTo guide our construction of a portfolio that is resilient to shocks and relevant for the future,our investment activities are aligned tofour structural trends.Digitisation and Sustainable Living are megatrends with a pervasive impact across all sectors and o

83、n the business models of incumbentand emerging businesses.Future of Consumption and Longer Lifespans reflect structural shifts in consumption patterns and growingneeds arising from population growth and longer expected lifespans.These trends are interconnected,transcend sectors andcountries,and pers

84、ist through economic cycles.Temasek Review 2024 3.Performance&Portfolio 3.3 Investment Approach29We continue to align our portfolio with such trends.We invest in companies that directly enable,drive,and benefit from these trends.In addition,we deploy capital to catalyse solutions that can enable com

85、panies to transition to a more sustainable future,tap onopportunities to invest in future growth sectors and business models,and encourage enterprises to transform through efforts ininnovation.We set aside a portion of our investment capital to back innovations and disruptive technologies at pre-com

86、mercialisation stages.Weare cognisant of the risks and challenges these early-stage companies face and accept the binary risks that come with investing inthem.Listed and UnlistedOur portfolio comprises both listed and unlisted assets,including our investments in funds.The unlisted portfolio has grow

87、n steadilyover the years as we invested in attractive opportunities in the private markets and benefitted from the increase in the value of ourunlisted assets.As at 31 March 2024,48%of our portfolio was in liquid and listed assets,and 52%was in unlisted assets and funds.We value our unlisted investm

88、ents at book value less impairment.Our unlisted portfolio,including our private equity co-investmentsand investments in private equity funds,generated returns of 9%per annum over the last decade and more than 10%per annum overthe last two decades,delivering higher returns than our listed portfolio.M

89、arking our unlisted portfolio to market would provide S$31 billion of value uplift which is approximately 15%of our unlisted portfolioas at 31 March 2024.789 Mainly cash and cash equivalents.7 Book value refers to Temaseks cost ofinvestment plus share of investeecompanys profits or losses,changes in

90、other equity reserves,minus write down(if any).8 Based on market approaches such asinvestee companys recent fundinground,market multiples of comparablepublic companies,and/or incomeapproach such as the discounted cashflow model.9Temasek Review 2024 3.Performance&Portfolio 3.3 Investment Approach30Ou

91、r unlisted portfolio is well diversified across geographies and sectors.Unlisted Singapore companies include mature companies such as Mapletree,PSA,and SP Group.(as at 31 March 2024)Unlisted Portfolio(%)Includes only key portfolio companies headquartered in Singapore.Singapore Portfolio Companies1As

92、set Management BusinessesPrivate Equity and Credit FundsOther Private Companies(Including Early Stage)1Temasek Review 2024 3.Performance&Portfolio 3.3 Investment Approach31Our asset management businesses include Seviora Holdings,Pavilion Capital,and Vertex Holdings.Our asset managementbusinesses man

93、age around S$83 billion in assets,which include third-party capital as well as our own capital.Investments in private equity and credit funds have enabled us to gain deeper insights into new markets and sub-sectors ofspecialisation while providing co-investment opportunities.The rest of our unlisted

94、 portfolio comprises direct investments in private companies.Our investments include Ant Group,AS Watson,Ceva Sant Animale,Element Materials Technology,Manipal Health Enterprises,Mastronardi,Schneider Electric India,and Topsoe.Our unlisted portfolio offers us liquidity through divestments;steady div

95、idends from mature companies;and distributions from thehigh-quality portfolio of funds we have built up over the years.The funds are well diversified across geographies,sectors,and vintages.We also achieve liquidity from our unlisted portfolio through public listings.For example,DoorDash,Gracell Bio

96、technologies,Intapp,Medanta,PB Fintech,and Zomato have listed in the past five years.Early-Stage InvestmentsOur focus as an investment company is to invest in innovation and growth.This includes investing in early-stage companies to identifypotential winners early;to keep abreast of the latest techn

97、ologies and innovations;and to drive portfolio development efforts.We alsoengage closely with portfolio companies on their efforts to assess potential disruption risks and to identify transformationopportunities arising from these new technologies.We are cognisant of the risks and challenges these e

98、arly-stage companies face and accept the binary risks that come with investing inthem.However,some of these companies also have the potential to achieve significant growth over time and deliver outsized returns.We manage our early-stage risk by appropriate sizing and diversification.We typically inv

99、est smaller amounts at the time of initialinvestment,with a view to increasing our stake if the company demonstrates successful de-risking.In addition,we cap our exposure tothis segment to 6%of our overall portfolio as part of our risk management framework.Currently,our early-stage investments accou

100、ntfor under 6%of our total portfolio,with about half through direct investments and the rest through venture capital funds.Integrating ESG Across Our InvestmentsWe apply an Environmental,Social,and Governance(ESG)framework across our entire investment process.This includes investmentdue diligence to

101、 ensure that the opportunities we consider align with our objectives for sustainability and good governance.Post-investment,we engage investee companies to advance sustainability practices,including strengthening climate targets and transitionplans,promoting inclusive workplaces as well as workplace

102、 health and safety,and fostering good governance.Investment Framework and Risk-Adjusted Cost of CapitalOur investment discipline is centred around intrinsic value and our risk-return framework.This framework forms the basis of ourinvestment decisions,capital allocation,performance measurement,and in

103、centive system.Our risk-adjusted cost of capital(RACOC)framework compares the relative attractiveness between investment opportunities.For eachinvestment,we conduct a bottom-up intrinsic value analysis,with expected returns evaluated against a RACOC that we derive using thecapital asset pricing mode

104、l.10 Seviora Holdings comprises fivecompanies namely Azalea InvestmentManagement,Fullerton FundManagement,InnoVen Capital,SeaTownHoldings International,and SevioraCapital.10Temasek Review 2024 3.Performance&Portfolio 3.3 Investment Approach32Each investments RACOC takes into account country risk,ind

105、ustry risk,and capital structure.Investments in riskier sectors or marketswill have higher costs of capital.We reflect additional risk by adding to the RACOC an illiquidity risk premium for unlisted investmentsand a venture risk premium for early-stage investments.We assess our performance by measur

106、ing our TSR against our overall RACOC,which is the weighted average RACOC across all ourindividual investments.(as at 31 March 2024)S$Total Shareholder Return Relative to Risk-Adjusted Cost of Capital(%)Period in years TSR by market value takes into account changes in the market value of our portfol

107、io,dividends we paid,and nets off any new investments made by our shareholder in Temaseksshares.Our risk-adjusted cost of capital accounts for different risks faced by our investments,and is derived using a capital asset pricing model.The risk-adjusted cost of capital is builtbottom-up,and aggregate

108、d across all our investments.TSR by shareholder equity takes into account the underlying profitability of our portfolio companies,realised returns from our investment activities,dividends we paid,and netsoff any new investments made by our shareholder in Temaseks shares.S$Total Shareholder Return by

109、 Market Value1Risk-Adjusted Cost of Capital2S$Total Shareholder Return by Shareholder Equity3123Temasek Review 2024 3.Performance&Portfolio 3.3 Investment Approach33(as at 31 March 2024)S$Total Shareholder Return Relative to Market Indices (%)Period in years Temaseks mandate is to deliver sustainabl

110、e returns over the long term.These market indices are broad indices,including a wide range of stocks across different countries andindustry sectors.The allocations of the indices across sectors and countries are typically based on the market capitalisation of listed stocks,and it is more commonly us

111、ed for passiveinvesting through Exchange-Traded Funds(commonly known as ETFs).Temaseks portfolio composition is very different from these indices,especially as Temaseks portfolio includes aproportion of unlisted assets.However,market indices provide useful broad reference points as to how the overal

112、l market had moved over time.Temasek has set out our performanceagainst various indices,where there is a complete dataset available,to assist those interested in such comparisons.The FTSE STI Index measures the performance of the top 30 companies listed on the Singapore Exchange.The MSCI AC Asia ex-

113、Japan Index measures the performance of large to mid-sized companies in Asia,excluding Japan.The MSCI ACWI Index measures the performance of large to mid-sized companies in the developed and emerging markets.1S$Total Shareholder Return by Market ValueFTSE STI2MSCI AC Asia ex-Japan3MSCI ACWI41234Tema

114、sek Review 2024 3.Performance&Portfolio 3.3 Investment Approach34We increased our internal carbon price from US$50 per tonne of carbon dioxide equivalent(tCO e)in the financial year ended 31March 2024 to US$65 per tCO e starting from 1 April 2024.Our internal carbon price is applied to each investme

115、nt to better assess thepotential climate impact,thereby enabling a greater focus on the long-term climate resilience of our portfolio.We expect toprogressively increase this to US$100 per tCO e by 2030.Investment Engagement and StewardshipAgainst the challenges and uncertainties in our macro environ

116、ment,companies have to be ever more agile and laser-focused on thedevelopment and execution of their strategies,in order to meet the expectations of their shareholders and other stakeholders.As an investor and owner seeking to achieve sustainable long-term returns from our portfolio,Temasek stays co

117、mmitted to workingwith our portfolio companies,their boards,and leadership,to ensure a close alignment between strategy and performance,andreturns and rewards.We seek to add value to our investee companies where appropriate,we work together with these companies toenhance value through partnerships,i

118、nnovation,growth strategies,and transformational possibilities.As an engaged shareholder,we proactively promote good governance,ethical business practices,and compliance with applicable laws.We set clear expectations and exercise our rights through voting at shareholder meetings.We view voting and e

119、ngagement as keylevers that are essential to long-term value creation and have formed a dedicated Investment Stewardship function to augment thateffort.21122 tCO e refers to tonnes of carbondioxide equivalent,a standard unit ofmeasurement used in greenhouse gasemissions accounting and reporting.112T

120、emasek Review 2024 3.Performance&Portfolio 3.3 Investment Approach353.4 Investment UpdateAmidst a bifurcated global economy,we took a cautious investment stance while staying guided by long-term structuraltrends.We invested S$26 billion and divested S$33 billion in the financial year ended 31 March

121、2024,with a net divestment of S$7 billion.Ourcautious investment stance was driven by expectations of a US recession until the Federal Reserve pivoted from its tight monetarypolicy in the last quarter of 2023,as well as the slower than expected pace of post-COVID recovery in China.Our divestments in

122、cludedthe significant redemption of capital by Singapore Airlines and Pavilion Energy respectively.Despite the market uncertainties,we believe that there are opportunities to be seized.The US remains the leading destination for ourcapital and we also stepped up our investment activities in Europe,In

123、dia,and Japan.Consistent with past years,we continued to deploy capital into opportunities aligned with the four structural trends and oursustainability objectives.We de-risked certain positions and realised gains from earlier investments.This will allow us to recycle ourcapital,and to take advantag

124、e of market dislocations and unique investment opportunities,as and when they arise.Investing Across Key Sectors and GeographiesWe made significant investments in consumer,financial services,healthcare,and technology sectors.In India,we strengthened our healthcare and financial services portfolio wi

125、th investments in Manipal Health Enterprises,a hospitalchain;Niva Bupa,a health insurance company;and follow-on investments in Axis Bank,HDFC Bank,and ICICI Bank.We continued oursupport for emerging champions by investing in Atomberg Technologies,a consumer electricals company,and Skyroot,a space te

126、chcompany which specialises in space launches for small satellites.In North America,we invested in Authentic Brands Group,a brand licensing and development company with a portfolio of over 50global brands;Microsoft,a software and cloud infrastructure company;and Twin Health,a digital therapeutics co

127、mpany focused onreversing chronic metabolic diseases.We re-invested in entertainment,sports,and media agency Creative Artists Agency,as part of itsacquisition by Artmis.The investment furthers our partnership with the company and its new owner in its next phase of growth.Wealso made follow-on invest

128、ments in iCapital Network,a financial technology company that provides access to alternative investments,and MSCI,a provider of indexes and investment solutions.In Europe,we invested in ASML,a Netherlands-based semiconductor capital equipment provider in the lithography sector,and H2Green Steel,a Sw

129、eden-based company that aims to accelerate the decarbonisation of the steel industry using green hydrogen.In China,we invested in companies underpinned by structural trends like Digitisation and Longer Lifespans.For example,we investedin Bambu Lab,a consumer tech company focused on 3D printers,and V

130、iva Biotech,a one-stop drug research and developmentplatform.Southeast Asia continued to offer investment opportunities aligned with the structural trend of Future of Consumption.During theyear,we increased our investment in Sea Limited,a global consumer Internet company based in Singapore.Temasek R

131、eview 2024 3.Performance&Portfolio 3.4 Investment Update36In line with growing digitisation,the availability of Large Language Models has accelerated the experimentation and adoption ofgenerative Artificial Intelligence(AI)across sectors and geographies.We are deepening our understanding of the enab

132、lers,adopters,and beneficiaries of generative AI.To this end,we have invested in companies that enable the effective implementation of AI on a largescale.These included companies involved in advanced semiconductor technologies and data centre infrastructure.In addition,severalof our portfolio compan

133、ies are actively expanding their data centre business,such as Keppel Data Centres,Mapletree,Singtel,and STTelemedia.We have made investments in companies that specialise in the development of AI-enabled applications,which contribute toenhancing business productivity.Our subsidiary,Aicadium,has been

134、working with selected portfolio companies on value-creation AIuse cases to uplift returns.Amidst the momentum and optimism for generative AI,we maintain a disciplined and cautious approach toinvesting in AI-related businesses.Investing to Drive Sustainable and Inclusive GrowthWe have been stepping u

135、p investments in companies that enable the transition towards a more sustainable future.Such efforts arealigned with the Sustainable Living trend,a megatrend that has pervasive impact across all sectors and on business models.Over the year,we invested in companies developing innovative electrificati

136、on solutions across the battery value chain.In the area ofbattery storage,we co-led with Decarbonization Partners a funding round for Ascend Elements,a US-based company that producesengineered battery materials from upcycled waste and scrap batteries.In the area of electric mobility,we invested in E

137、lectric Vehicle(EV)companies in India and China,with new investments in Mahindra Electric Automobile,an India-based company that manufacturesfour-wheeler passenger EVs,and BYD,a pioneer EV and battery manufacturer in China.We also made a follow-on investment in OlaElectric,an India-based electric tw

138、o-wheeler manufacturer.We invested in companies across the hydrogen value chain which are creating promising clean energy solutions.Over the year,weinvested in US-based companies that manufacture,deliver,and commission electrolysers for critical industries to produce low-costgreen hydrogen.For examp

139、le,we made a new investment in Electric Hydrogen and a follow-on investment in Verdagy.We continued to invest in funds and companies that aim to generate a positive impact for underserved communities while achievingsustainable returns over the long term.Over the year,we committed to funds that aim t

140、o enable climate mitigation in underservedcommunities.These included LeapFrogs Climate Fund,which addresses climate change in Africa and emerging markets in Asia,andABC Impacts Fund II,which focuses on achieving positive social or environmental outcomes in Asia.Find out more about how we embed susta

141、inability in our investmentsTemasek Review 2024 3.Performance&Portfolio 3.4 Investment Update373.5 Major InvestmentsSources:1.Financials for the companies are based on their respective annual filings.2.Market relevant information is sourced from Bloomberg,Stock Exchanges,and public filings by compan

142、ies.GlossaryMarket Capitalisation=Market value as at 31 March 2024 and 31 March 2023Shareholder Equity=Shareholder equity reported by the respective companies based on their annual filingsNameShareholding (%)as at 31 March 2024CurrencyMarket Capitalisationor Shareholder EquitySectorHeadquarters20242

143、023Adyen N.V.6EURm48,68145,237Financial ServicesNetherlandsAIA Group Limited3HKDm593,481964,512Financial ServicesHong KongSARAlibaba GroupHolding Limited 3.Performance&Portfolio 3.5 Major Investments38NameShareholding (%)as at 31 March 2024CurrencyMarket Capitalisationor Shareholder EquitySectorHead

144、quarters20242023EM Topco Limited(Element MaterialsTechnology)88USDm2,5433,195Transportation&IndustrialsUKGlobal HealthcareExchange,LLC71NANANATelecommunications,Media&TechnologyUSHDFC Bank Limited1INRm10,999,5678,980,875Financial ServicesIndiaICICI Bank Limited2INRm7,677,5206,125,675Financial Servic

145、esIndiaIndustrial andCommercial Bank ofChina Limited1HKDm1,887,9471,736,141Financial ServicesChinaKeppel Ltd.21SGDm13,0269,900Transportation&IndustrialsSingaporeM+S Pte.Ltd.40NANANAConsumer&RealEstateSingaporeMandai ParkHoldings Pte.Ltd.100SGDm1,049779Consumer&RealEstateSingaporeManipal HealthEnterp

146、rises PrivateLimited35INRm40,28632,421Life Sciences&Agri-FoodIndiaMapletreeInvestments Pte Ltd100SGDm18,97919,908Consumer&RealEstateSingaporeMastercardIncorporated 3.Performance&Portfolio 3.5 Major Investments39NameShareholding (%)as at 31 March 2024CurrencyMarket Capitalisationor Shareholder Equity

147、SectorHeadquarters20242023Olam Group Limited52SGDm4,2686,033Life Sciences&Agri-FoodSingaporePing An Insurance(Group)Company ofChina,Ltd.2HKDm718,593935,745Financial ServicesChinaPSA International PteLtd100SGDm15,05014,317Transportation&IndustrialsSingaporeSATS Ltd.40SGDm3,8764,150Transportation&Indu

148、strialsSingaporeSchneider ElectricIndia Pvt.Ltd.35INRm120,961103,806Transportation&IndustrialsIndiaSeatrium Limited36SGDm5,3898,188Transportation&IndustrialsSingaporeSembcorp IndustriesLtd49SGDm9,6127,792Transportation&IndustrialsSingaporeSingapore AirlinesLimited53SGDm19,03317,021Transportation&Ind

149、ustrialsSingaporeSingapore PowerLimited100SGDm12,87412,317Transportation&IndustrialsSingaporeSingaporeTechnologiesEngineering Ltd51SGDm12,54211,413Transportation&IndustrialsSingaporeSingaporeTechnologiesTelemedia Pte Ltd100SGDm4,6825,035Telecommunications,Media&TechnologySingaporeSingaporeTelecommun

150、icationsLimited51SGDm41,75340,600Telecommunications,Media&TechnologySingaporeSMRT CorporationLtd100SGDm1,010972Transportation&IndustrialsSingapore5559555555Logo21Temasek Review 2024 3.Performance&Portfolio 3.5 Major Investments40NameShareholding (%)as at 31 March 2024CurrencyMarket Capitalisationor

151、Shareholder EquitySectorHeadquarters20242023Standard CharteredPLC17GBPm17,54717,422Financial ServicesUKTencent HoldingsLimited1HKDm2,869,3913,689,755Telecommunications,Media&TechnologyChinaVisa Inc.3.Performance&Portfolio 3.5 Major Investments413.6 Credit ProfileTemaseks Credit Profile is a snapshot

152、 of our credit quality and financial strength,serving as a public marker along withour credit ratings.For these ratios,the lower the percentage,the higher the credit quality.(as at 31 March)12Total Debt5%of Net Portfolio ValueTotal Debt18%of Liquid Assets Mainly cash and cash equivalents,and sub-20%

153、listed assets.Total DebtNet Portfolio Value1Total DebtLiquid Assets1 Based on the financial information ofTemasek as an investment company,namely Temasek Holdings(Private)Limited(THPL)and its InvestmentHolding Companies(IHCs).IHCs aredefined as THPLs direct and indirectwholly-owned subsidiaries,whos

154、eboards of directors or equivalentgoverning bodies comprise employeesor nominees of THPL,wholly-ownedTemasek Pte.Ltd.(TPL),and/or TPLswholly-owned subsidiaries.The principalactivities of THPL and its IHCs are that ofinvestment holding,financing,and/orthe provision of investment advisory andconsultan

155、cy services.12Temasek Review 2024 3.Performance&Portfolio 3.6 Credit Profile42Interest Expense6%of Dividend IncomeInterest Expense1%of Recurring Income Divestments,dividend income,income from investments,and interest income.Interest ExpenseDividend Income1Interest ExpenseRecurring Income1Total Debt

156、due in One Year2%of Recurring Income Divestments,dividend income,income from investments,and interest income.Total Debt due in next 10 Years15%of Liquidity Balance Cash and cash equivalents,and short-term investments.1Total Debt due in One YearRecurring Income11Total Debt due in next 10 YearsLiquidi

157、ty Balance1Temasek Review 2024 3.Performance&Portfolio 3.6 Credit Profile43As an investment company,our divestments,dividends from our portfolio and distributions from funds are used to make investments,fund business expenses,as well as pay interest and principal to bondholders and Euro-commercial P

158、aper holders,taxes to taxauthorities,and dividends to our shareholder.For the year ended 31 March 2024,Temasek made S$33 billion of divestments,which include fund distributions,and earned S$9 billionin dividend income.These amounts formed the bulk of our recurring income.We aim to build a resilient

159、and forward-looking portfolio.We maintain sufficient access to liquidity to not only serve as a buffer againstshocks in this uncertain environment,but also to allow us to take advantage of investment opportunities.Our portfolio includes high-quality assets that provide us with strong and stable liqu

160、idity.We also maintain the discipline of regular divestments to generateliquidity.We are rated Aaa/AAA by Moodys Investors Service and S&P Global Ratings respectively.Ratings are an outcome of credit ratingagencies independent assessment of Temaseks business and financial position in accordance with

161、 their respective methodologies.Key Credit Parameters(in S$billion)13For year ended 31 March20202021202220232024Divestments2639372733Dividend income11.98.49.411.19.0Income from investments0.80.71.00.90.9Interest income0.70.10.10.61.4Interest expense0.40.40.50.50.5Net portfolio value306381403382389Li

162、quid assets112.4143.1113.6104.5113.0Liquidity balance47.150.838.443.761.8Total debt13.917.622.021.720.9 From the year ended 31 March 2020,the applicable accounting standard(IFRS 16:Leases)has required us to record our leases,comprising mainly office rental,on our balance sheet.This means that our le

163、ase liabilities and interest expense on lease liabilities are included as part of total debt and interest expense respectively.The credit ratios from the year ended31 March 2020 reflect this change in accounting standards.Mainly cash and cash equivalents,and sub-20%listed assets.Cash and cash equiva

164、lents,and short-term investments.As at 31 March 2024,we had S$20.2 billion of Temasek Bonds and S$0.5 billion of Euro-commercial Paper(ECP)outstanding,in equivalent Singapore dollar value.The weightedaverage maturity for Temasek Bonds was over 18 years,and above four months for our ECP.All Temasek B

165、onds issued to date have been rated Aaa by Moodys Investors Service(Moodys)and/or AAA by S&P Global Ratings(S&P).Our ECP Programme has short-term ratings of P-1/A-1+by Moodys and S&P respectively.1231,41234 From time to time,rating agenciesmay modify their rating criteria.Suchcriteria changes may le

166、ad to a revision inthe rating assigned to an entity,sometimes even when the entitysfinancial position has not materiallychanged.13Temasek Review 2024 3.Performance&Portfolio 3.6 Credit Profile443.7 Managing RisksThere are inherent risks whenever we invest,divest,or hold our assets,and wherever we op

167、erate.While we adopt a long-term view of our portfolio,we invest across different time horizons.We have the flexibility to take concentratedpositions and invest across all stages of the business life cycle,from early-stage to mature,and unlisted to listed assets.We do nothave specific targets for in

168、vesting by asset class,country,sector,or single name.Our long investment horizon means we have a portfolio of predominantly equities which is expected to deliver higher risk-adjustedreturns over the long term.Our stable funding base allows us to invest and benefit from companies with high growth pot

169、ential throughlisted and unlisted assets(including private equity funds).Consequently,given the high equity exposure,our portfolio is expected to have higher volatility of returns,with a greater risk ofnegative returns in any one year.Our investment approach is to ride out short-term market volatili

170、ty and focus on generating sustainable returns over the long term.Given the expected volatility,we manage our leverage and liquidity prudently for resilience and investment flexibility,even in times ofextreme stress.Our investment posture is coupled with a culture of risk ownership throughout the or

171、ganisation.Our risk-sharing compensationphilosophy puts the institution above the individual,emphasises the long term over the short term,and aligns the interests of our staffwith those of our shareholder.We have no tolerance for risks that could damage the reputation and credibility of Temasek.Our

172、Organisational Risk Management Framework includes Risk Return Appetite Statements which set out various levels of riskstolerance,from reputational risk to liquidity risk,and risk of sustained loss of overall portfolio value over prolonged periods.Temasek Review 2024 3.Performance&Portfolio 3.7 Manag

173、ing Risks45Organisational Risk Management FrameworkRisk Return Appetite StatementsWe have no tolerance for risks that could damage Temaseks reputation and credibilityTemasek rigorously identifies potential sources of reputational risk and how each type of reputation risk is to be managedWe focus on

174、performance over the long termWe target a long-term portfolio return that exceeds our risk-adjusted cost of capitalWe are prepared to accept fluctuations in annual reported results provided we are compensated by superior longer-termreturns and it does not affect our ability to surviveWe have flexibi

175、lity to take concentrated positionsWhere good investment opportunities allow for superior long-term performance,Temasek has the flexibility to take portfolioconcentrations in specific sectors,geographies,themes,or individual assetsWe adopt a disciplined approach to investing,with end-to-end assessme

176、nt frameworks and processes for each asset classFor direct equity investments this includes developing a deep understanding of each investment in order to determine theintrinsic value for investment,divestment,and hold decisionsWe maintain a resilient balance sheetWe manage leverage and liquidity to

177、 ensure resilience and flexibility even in times of extreme stressWe evaluate the potential for sustained loss of overall portfolio value over prolonged periods,and use differentscenarios to test our resilienceRisk PillarsInvestment RiskLiquidity&Leverage RiskPortfolio ValueRiskOperational RiskCyber

178、securityRiskLegal&Regulatory RiskMacro and Geopolitical Risk Includes Foreign Exchange Risk and Environmental,Social,and Governance Risk.11Temasek Review 2024 3.Performance&Portfolio 3.7 Managing Risks46Risk GovernanceThere are various risk pillars by which we assess risks across a wide spectrum of

179、domains.These risk pillars are supported byspecialised teams,comprising members from different functions,which report to senior management for general oversight.We embedrisk management in our systems and processes.These include our approval authority delegation,company policies,standard operatingpro

180、cedures,and risk reporting to our Board and Board Risk&Sustainability Committee.Investment RiskAll new investment proposals are subject to a due diligence process commensurate with the nature of the investment to be made.Thisis intended to validate business theses and examine material risks.The exac

181、t scope of the required pre-investment analysis will bedetermined based on the specific risk profile being considered.Pre-investment analysis is done by our deal origination teams whoseexpertise is supplemented by internal experts or external professionals who perform additional due diligence in spe

182、cialised areas suchas legal,tax,and climate risks.When we invest in companies,we conduct a bottom-up fundamental valuation analysis and due diligence.We also use an appropriaterisk-adjusted cost of capital(RACOC)to determine a best estimate of company valuation.Our analysis enables us to estimate a

183、fairvalue for the company.We also estimate stress case valuations to help us gauge the degree of variability in potential future returnsunder different assumptions.We will compare our reasonable estimate of fair value with current market valuation to determine if an investment makes sense at theprop

184、osed price,and if it provides a margin of safety to our RACOC,including an estimated cost of carbon emissions.The discount rate used in the valuation process will be a weighted average of the companys cost of debt and equity capital.We utilisethe capital asset pricing model to derive an appropriate

185、cost of equity.This takes into account leverage,the type of industry,and thecountries of operation.Investments in riskier sectors or markets will have higher costs of capital.We also add an illiquidity riskpremium for unlisted investments and a venture risk premium for early-stage investments to acc

186、ount for their respective risks.We use individual companies RACOC to compare the relative attractiveness between investment opportunities.We may dial up or downthe required spread over RACOC as a tool to tighten or loosen our investment risk posture.Depending on the external outlook and our investme

187、nt stance,we may choose to invest in opportunities with positive expectedreturns,which are below their respective individual RACOC.We also deploy excess liquidity in short-term liquid investments where theexpected returns may be lower than our cost of capital.All prospective investments must be revi

188、ewed and approved by our investment committee.Investment proposals made to the investment committee are typically submitted by both market and sector teams who providegeographic and industry expertise.Depending on the size or risk significance,these proposals may be escalated to our Board ExecutiveC

189、ommittee or Board for a final decision.Post-investment monitoring is performed by the investment teams on a continuous basis,and formally by senior management atquarterly review meetings chaired by the Deputy CEO.They assess if the investment is performing to our expectations and whether anyaction s

190、hould be taken.Temasek Review 2024 3.Performance&Portfolio 3.7 Managing Risks47Foreign Exchange RiskOur projected risk-adjusted return for each investment proposal takes into account any anticipated foreign exchange(FX)movementsagainst the Singapore dollar.We also selectively hedge FX exposures from

191、 confirmed nearer-term cash flow and expected divestments within our forecast period.Environmental,Social,and Governance RiskOur investments are evaluated on the basis of our Environmental,Social,and Governance(ESG)framework,which is integrated withinthe investment process.This framework requires th

192、e analysis of material ESG considerations,with an emphasis on climate-related risks.As part of our analysis,we apply an internal carbon price of US$65 per tonne of carbon dioxide equivalent(tCO e).This provides anadditional consideration to our assessment of the long-term climate resiliency and our

193、returns expectations for each investment.We are also strengthening our analytic capabilities to enhance our pre-investment due diligence and post-investment engagements toaddress material nature-related risks.We piloted a set of baseline expectations in social areas such as human rights and labour p

194、ractices;diversity,equity,and inclusion;talent management;product quality and safety;data privacy and security;and supply chain responsibility.To manage and mitigate suchrisks,we conduct deeper due diligence in cases where potential exposure to social risk is identified.Our Board Risk&Sustainability

195、 Committee(RSC)was established in January 2022 to,amongst other things,enhance the focus onopportunities and risks arising from sustainability trends,including climate change,and other financial,reputational,operational,andcyber risks.Liquidity&Leverage RiskWe manage our leverage,liquidity,and balan

196、ce sheet prudently for resilience and flexibility.We maintain a high level of liquidity in ourportfolio and manage our liquidity risk by ensuring that our primary recurring sources of cash flows are able to cover our non-discretionary uses of cash,such as operating expenses,taxes,and interest to bon

197、dholders.Our recurring income includes divestments,dividends from portfolio companies,and distributions from funds.Our liquidity is supported primarily by our recurring income,supplemented by proceeds from any debt issuances via Temasek Bondsand Euro-commercial Paper,as well as bank borrowings.Total

198、 leverage is restricted by an overall debt limit set by our Board.The debtlimit takes into account our portfolio value,shareholder funds,forecast cash flow,and credit profile.We proactively plan for a well-distributed debt maturity profile,avoiding large refinancing risk in any one year.In addition

199、to maintaining the discipline of regular divestments to generate liquidity,the construction of our portfolio enables us toaccess liquidity relatively quickly in times of stress.As at 31 March 2024,our liquid and sub-20%listed assets alone were about fivetimes our debt outstanding.In the highly unlik

200、ely extreme scenario where we have no other cash inflows,aside from using our liquiditybalance,divesting a small part of our liquid and sub-20%listed assets would be sufficient to cover the total debt outstanding in undertwo weeks.As a policy,Temasek does not provide any financial guarantees for the

201、 obligations of our portfolio companies.1421516 Increased from US$50 since 1 April2024.14 tCO e refers to tonnes of carbondioxide equivalent,a standard unit ofmeasurement used in greenhouse gasemissions accounting and reporting.152 Based on the assumption that we willsell no more than 20%of the aver

202、agedaily trading volume over the financialyear ended 31 March 2024.This is foreach investment where our shareholdingwas below 20%,as at 31 March 2024.16Temasek Review 2024 3.Performance&Portfolio 3.7 Managing Risks48Portfolio Value RiskWe track and manage risks proactively,through economic and marke

203、t cycles,including specific risks at the asset level.We assess the sustained impact of multiple risk scenarios on the intrinsic value of our investments.The aggregate of these changesprovides an estimate of the portfolio level variation in present value,future cash flows,and income in each scenario.

204、As illustrated in the diagram below,Fundamental Earnings Impact is our estimate of sustained loss.This is different from TroughImpact,which includes mark to market effects due to short-term increases in risk aversion.In a stress event,our largely equity portfoliowill likely be adversely affected by

205、market volatility reflecting increased short-term risk aversion.However,markets typically recoverfrom the trough and normalise after the stress event is over.Over time,we expect our portfolio value to recover towards the previousgrowth rate,but from a lower starting point.We do not manage our portfo

206、lio to short-term mark to market changes.Based on our assessments of any likely sustained loss,consistent with our intrinsic value discipline,we may manage the risks asfollows:Divest,hold,or protect the individual investment impacted;Change the portfolio composition for the long run;Take actions to

207、protect the portfolio,for example,by entering into tactical single stock,index or rates hedges.Illustration of Fundamental Earnings ImpactBase CaseStress ScenarioTemasek Review 2024 3.Performance&Portfolio 3.7 Managing Risks4912-months Returns SimulationWhile we expect volatility consistent with a l

208、argely equities portfolio,we manage our portfolio to deliver sustainable returns over thelong term.For our current portfolio mix,our Monte Carlo simulations based on recent market conditions show a five-in-six chance that one-yearforward portfolio returns may range from-10%to+15%.Our annual returns

209、ranged from-30%to+43%over the past 20 years.Narrower curves in the chart below mean less volatility compared,for instance,to the flatter curves of the 2008/09 Global FinancialCrisis(GFC)years.A wider simulated range means a more volatile outlook.(as at 31 March)Simulation of 12-month Forward Portfol

210、io Returns Based on Monte Carlo simulation for 12-month forward portfolio returns distribution,assuming no change in market conditions or portfolio mix.Total Shareholder Return.Periods of low market volatility.Periods of medium market volatility.Periods of high market volatility.12345Temasek Review

211、2024 3.Performance&Portfolio 3.7 Managing Risks50The range of possible returns from the simulation is dependent on the prevailing volatility and correlation conditions of asset markets.When prevailing volatility is high,such as at the onset of the COVID-19 pandemic or during the GFC years,the wider

212、range of one-yearsimulated forward returns signals greater probability of larger gains and losses.When volatility is low,as at present,simulated forwardreturns fall within a narrower range.However,history shows that periods of lower volatility may be followed by sudden dislocations.Wetherefore compl

213、ement these estimates based on current conditions with the scenario stress tests process described above.(as at 31 March)Volatility of Returns(%)Simulated returns in a period of low market volatilitySimulated returns in a period of medium market volatilitySimulated returns in a period of high market

214、 volatilityActual Total Shareholder Return a year later Based on Monte Carlo simulation for 12-month forward portfolio returns distribution,assuming no change in market conditions or portfolio mix.1111Temasek Review 2024 3.Performance&Portfolio 3.7 Managing Risks51Operational RiskWe are committed to

215、 continuously improving the way we manage business continuity risks.Our contingency management frameworkensures business continuity and covers incidents arising from safety,physical security,and other threats.The framework also takes intoaccount the potential impact of emerging risks,such as physica

216、l threats and health situations around the world.We have institutionalised a risk incident reporting process which encourages staff to proactively report gaps,perform root causeanalysis,and adopt appropriate remediating measures for all reported risk incidents.This contributes to a work environment

217、with afocus on excellence and helps build a healthy risk management culture in Temasek.In response to growing physical security threats,we provide regular training to relevant stakeholders to adequately equip them withresponse techniques for emergency situations.For instance,Evacuation Wardens recei

218、ve occupational first aid training,while ourBusiness Continuity Planning Coordinators and front-line Emergency Response Team undergo emergency response training.Additionally,we have established multiple communication channels to ensure effective information dissemination.This proactiveapproach enabl

219、es us to respond promptly and confidently in times of emergencies.In addition to the training,we regularly conduct response exercises simulating critical infrastructure failures,and scenario-basedtabletop exercises with key stakeholders to ensure that our contingency and disaster recovery plans rema

220、in effective,relevant,andadequate.We constantly work on improving our capabilities to ensure that our staff and visitors remain safe,and that critical businessfunctions can resume in a timely manner.For crisis management,the primary focus typically revolves around strategies and swift decision-makin

221、g.While these elements arecrucial,the mental well-being of our staff is equally paramount.As such,we have integrated our Care Supporters network into ourcrisis management processes.This significantly enhances our ability to manage crisis response and recovery efforts effectively.Tostrengthen psychol

222、ogical resilience amongst staff,more than 70%of our staff have been trained and equipped with basic psychologicalsupport skills.Cybersecurity RiskGiven the evolving cybersecurity landscape,we regularly monitor and track cyber risks and continuously enhance our cybersecuritydefence and resilience.We

223、continually assess and perform regular testing of our environment to ensure our cybersecurity controls areeffective,and are committed to enabling secure deployments of applications and technologies that support business needs.Mostrecently,we established an Artificial Intelligence(AI)governance frame

224、work to enable secure AI deployment across the firm.Inaddition,we conduct simulation exercises and update our cyber response plans on a regular basis to ensure continued relevance,familiarity,and effectiveness.We engage our portfolio companies,together with our Temasek Operating System partners,on a

225、n ongoing basis to championcybersecurity best practices and to elevate our respective cyber defence and resilience capabilities.This year,we also introduced aBoard-level Cyber Risk Governance Guideline to support board oversight of cyber governance and standards in our portfoliocompanies.Temasek Rev

226、iew 2024 3.Performance&Portfolio 3.7 Managing Risks52Our cybersecurity team,supported by expertise from our cybersecurity platform companies,assesses the cybersecurity health ofpotential investee companies as part of the investment due diligence process.Their assessment is based on four areas:key da

227、taassets;regulatory requirements and data privacy;cybersecurity policy and governance;and assessment and incidents.Acomprehensive cybersecurity scan on potential investee companies may also be conducted.Legal&Regulatory RiskWe comply with all obligations under Singapore laws and regulations,includin

228、g those arising from international treaties and UNsanctions,as well as the laws and regulations of jurisdictions where we have investments or operations.Our global footprint,coupled with a fast and ever-evolving legal and regulatory environment and increasing enforcement and oversightby authorities,

229、reinforces the importance of robust transactional processes and compliance programmes.We continue to buildexpertise across novel and developing areas that we are involved in to ensure that we are able to identify and manage legal,regulatory,and compliance risks appropriately.Our Legal&Regulatory(L&R

230、)department ensures that policies,processes,and systems are appropriately designed and implemented,consistent with applicable laws and aligned with Board directives to advance the firms objectives while managing risks andsafeguarding its interest.For example,we have implemented policies and control

231、processes to address financial crime such as briberyand corruption,and sanctions violations;to ensure compliance with foreign direct investment,merger control,and export controlregimes;and to manage legal and regulatory risks relating to the trading of derivatives.We continuously monitor regulatoryd

232、evelopments to ensure that our policies,procedures,and monitoring systems reflect these changes.We encourage and facilitate the development of a sound corporate culture that incentivises good staff behaviour.High ethicalstandards and compliance with applicable laws and regulations are expected in th

233、e pursuit of our business interests.Specific attentionis directed at governance,incentive systems,and training.At the core of this is our Temasek Code of Ethics and Conduct(T-Code)and its related policies that guide our Board directors and staffin their daily dealings and conduct.With integrity as t

234、he key overarching principle,T-Code policies cover areas such as anti-bribery,whistle-blowing,management of confidential information,and prohibition against insider trading.All staff also undergo mandatorytraining in anti-bribery and corruption,anti-harassment and discrimination,as well as the preve

235、ntion of insider trading.Our annualstaff bonus plans include T-Code compliance requirements.Macro and Geopolitical RiskOver the last decade,besides the ever-changing macroeconomic landscape,we have seen heightened geopolitical tensions arisingfrom events such as war and the pandemic,as well as great

236、 power rivalry.Our views around the global economy help to guide Temaseks investment stance and our overall deployment pace.We also recognisethat there has been a renewed and urgent focus on national security(encompassing economic security and competition),resiliencyincluding energy and commodity su

237、fficiency,data ownership,techno-nationalism in sectors such as biotechnology,and the use ofsubsidies,to name a few pressing issues.The presumptive gains from the globalisation of trade,investment,and technology aresubject to ever-greater scrutiny.Temasek Review 2024 3.Performance&Portfolio 3.7 Manag

238、ing Risks53To stay ahead of these developments,our International Policy and Governance teams located in Beijing,Brussels,Singapore,andWashington,DC actively monitor geopolitical risks and anticipate policy developments in our key markets that could impact ouractivities.Through our engagement with th

239、ought leaders and authorities,we exchange views so as to promote better outcomes for all in thedesign and implementation of policy.In particular,we aim to promote a better understanding of how we operate based on commercialprinciples,and independent of government interference and support.For example

240、,we had supported the International Monetary Fundinitiative to frame the Santiago Principles for sovereign investments back in 2008.We advocate good governance and uphold theseprinciples.Copyright 2024 Temasek Holdings(Private)LimitedTemasek Review 2024 3.Performance&Portfolio 3.7 Managing Risks54Sk

241、SustainabilityTemasek Review 2024 4.Sustainability554.1 Sustainability OverviewOur commitment to sustainability is integral to building a thriving and resilient portfolio that enables us to deliversustainable returns over the long term.Sustainability is at the core of everything we do from our manda

242、te to deliver sustainable returns over the long term,to our strategyof how we operate as an institution,shape our portfolio,and engage our portfolio companies to build sustainable businesses.Our long-term success is contingent on the presence of vibrant businesses and economies,cohesive societies an

243、d communities,and aresilient planet.We have been advancing our net zero efforts through decarbonising our existing portfolio,making new investments,forgingpartnerships,and building platforms.With an increasing recognition of the interconnectedness between climate change,the natural environment,and s

244、ocial impact,we havealso started to take an integrated approach in how we systematically strengthen our contribution to nature positive and inclusivegrowth.We do so through our Nature and Social Roadmaps,which are multi-year initiatives to advance social and nature positivepractices within our portf

245、olio.Sustainability MilestonesIn recent years,we achieved several milestones in our sustainability journey.We took part in the International Sustainability Standards Boards(ISSB)COP28 Declaration of Support,joining close to 400organisations across 64 jurisdictions in committing to advance the ISSBs

246、global baseline for consistent and comparable climate-relateddisclosures.We launched our inaugural Sustainability Report,which brings together our disclosures and tracks our progress.Our report takes intoconsideration the disclosure requirements issued by the ISSB.Our internal carbon price was raise

247、d from US$50 per tCO e to US$65 per tCO e on 1 April 2024.We expect to progressively increasethis to US$100 per tCO e by 2030.Any initiative addressing the climate crisis cannot be undertaken without collaboration.We continue to forge partnerships and workwith like-minded partners.In doing so,we har

248、ness the collective strengths of our networks to catalyse and scale positive impact.Our efforts have included partnerships to scale climate tech innovations,such as the establishment of Breakthrough Energy Fellows-Southeast Asia with Breakthrough Energy and Enterprise Singapore.Find out more about o

249、ur sustainability strategyFind out more about our approach to sustainability governance21722 tCO e refers to tonnes of carbondioxide equivalent,a standard unit ofmeasurement used in greenhouse gasemissions accounting and reporting.172Temasek Review 2024 4.Sustainability 4.1 Sustainability Overview56

250、We also collaborate to deploy innovative financing solutions that enable a just and inclusive climate transition in emerging markets anddeveloping economies.For example,we are partnering the Monetary Authority of Singapore(MAS)on several initiatives,such as theGreen Investments Partnership,which is

251、part of MAS Financing Asias Transition Partnership,a blended finance mechanism toaccelerate a sustainable transition in the region.This year,we convened Ecosperity Week 2024,a milestone edition as we marked the platforms 10 anniversary.The need to protectand restore nature featured high on the agend

252、a,alongside the role of philanthropic capital and blended finance in bridging the climatefinance gap.thFind out more about our sustainability strategic partnerships and platformsFind out more about our past sustainability milestonesTemasek Review 2024 4.Sustainability 4.1 Sustainability Overview574.

253、2 Advancing Sustainability Through Our PortfolioAs an investor and owner,we strive to build a portfolio of companies that contribute to the resilience and progress ofour environment and society.Sustainable Living,one of the four structural trends that guides our portfolio construction,is a megatrend

254、 which has pervasive impactacross all sectors and business models.We have stepped up the deployment of capital to enable the transition to a more sustainablefuture.As at 31 March 2024,our investments that are aligned with the Sustainable Living trend represented 12%of net portfolio value.Thiscompris

255、es sustainability-focused investments and climate transition investments,which include established businesses as well ascompanies with disruptive ideas in key focus areas such as food,water,waste,energy,materials,clean transportation,and the builtenvironment.Pathways Towards Our Climate TargetsOur t

256、arget is to reduce the net carbon emissions attributable to our portfolio to half of its 2010 levels by 2030,with the ambition toachieve net zero by 2050.This requires determined and sustained action.In recent years,we have accelerated efforts to achieve our climate targets through three pathways:In

257、vesting for a Low-Carbon EconomyWe continue to step up investments that support the transition towards a low-carbon economy.Theseinclude solutions that seek to accelerate energy transition and decarbonisation across key sectors,be itthrough the advancement of hydrogen technologies,energy-efficient s

258、olutions,or alternative productionprocesses in hard-to-abate sectors.Encouraging Decarbonisation Efforts in Our Portfolio CompaniesOur long-term investment horizon,which can span decades,puts us in a unique position to engage ourportfolio companies on their business transformation and adoption of ca

259、rbon mitigation actions.Find out more about such investmentsFind out more about our efforts to engage portfolio companiesTemasek Review 2024 4.Sustainability 4.2 Advancing Sustainability Through Our Portfolio58Enabling Carbon Markets SolutionsWe continue to explore approaches that support decarbonis

260、ation while conserving or restoring naturalsystems.We view voluntary carbon markets as an important lever in enabling nature-based and technology-based solutions.Through GenZero,we continue to invest in strengthening the carbon marketsinfrastructure and ecosystem.Advancing Sustainability Through Str

261、ategic Partnerships and PlatformsWe have stepped up efforts through our strategic partnerships and platforms to accelerate industry transitions,further diversify andaugment the financing toolbox,and grow the green economy.One such partnership is Decarbonization Partners,our joint venture with BlackR

262、ock.It recently closed its inaugural late-stage ventureand early-growth private equity investment fund,Decarbonization Partners Fund I,at US$1.4 billion in committed capital.The Fund hasinvested in more than five companies covering areas such as carbon capture,utilisation,and storage;next-generation

263、 energy;andcarbon management services.GenZero has built up a diversified portfolio by actively deploying capital across nature-based solutions,technology-based solutions,and carbon ecosystem enablers.Examples of GenZeros investments include a land restoration project in Ghana;sustainable aviationfue

264、l-related technology companies such as Velocys;and a carbon marketplace and exchange,Climate Impact X(CIX).GenZero has alsoseen further validation of its investment in CIX with Mizuho Financial Group coming on board as an additional lead investor to scale thevoluntary carbon credits market in Asia.O

265、ur ability to deploy capital flexibly has enabled us to look beyond traditional financing approaches.Alongside other partners,we striveto address climate financing gaps with varied and innovative solutions.These include blended and/or transition finance mechanismsthat can better support the developm

266、ent and scaling of sustainable infrastructure.Clifford Capital Holdings is one of our platform companies providing debt financing solutions for the infrastructure and maritimesectors.It has structured and issued three project and infrastructure debt securitisation transactions for eligible green and

267、 social loanssince its first issuance in 2018,with its most recent issuance in September 2023.Pentagreen Capital,our joint venture with HSBC,has started to catalyse financing for sustainable infrastructure projects in Asia.Itsigned its first transaction with Philippines-based solar development compa

268、ny Citicore Solar Energy Corporation,structuring a US$100million mezzanine construction green loan with an initial tranche of US$30 million.The initial tranche supports a portfolio of six solarprojects in the Philippines and is expected to enable more than US$300 million in total project capital val

269、ue.The transaction reflectsPentagreens potential as a specialised lender to remove barriers to bankability.Temasek Review 2024 4.Sustainability 4.2 Advancing Sustainability Through Our Portfolio59Emissions Associated with Our PortfolioWe have been disclosing the carbon emissions attributable to our

270、investment portfolio as part of our annual reporting and we aretracking the progress towards our climate targets.Total Portfolio Emissions have decreased from 27 million tonnes of carbon dioxide equivalent(tCO e)for the financial year ended 31March 2023 to 21 million tCO e for the financial year end

271、ed 31 March 2024.The reported Total Portfolio Emissions encompass 77%of the portfolio as at 31 March 2024.Portfolio Weighted Average Carbon Intensity has also decreased from 116 tCO e/S$M revenue for the financial year ended 31 March2023 to 92 tCO e/S$M revenue for the financial year ended 31 March

272、2024.181922202122(for year ending 31 March)Towards Net Zero tCO e refers to tonnes of carbon dioxide equivalent,a standard unit of measurement used in greenhouse gas emissions accounting and reporting.Total Portfolio Emissions reflect the absolute emissions(Scope 1 and Scope 2)associated with our in

273、vestment portfolio,expressed in tCO e.Our investment positions in private equityfunds,credit,and other assets are excluded.Negative emissions acquired through investments and high-quality carbon offsets.Historical Total Portfolio Emissions2Total Portfolio Emissions (Illustrative)2Negative Emissions

274、(Illustrative)3Pathway for Net Portfolio Emissions(Illustrative)Calendar year emissions data and targets are reported in the subsequent financial year12223 PricewaterhouseCoopers LLP,anindependent third party,has undertakena limited assurance engagement on theselected portfolio emission metrics fort

275、he financial year ended 31 March 2024.Their assurance report can be foundhere.18 Total Portfolio Emissions reflect theabsolute emissions(Scope 1 and Scope2)associated with our investmentportfolio,expressed in tCO e.Ourinvestment positions in private equityfunds,credit,and other assets areexcluded.19

276、2 Reflects percentage of total marketvalue of our assets in-scope for TotalPortfolio Emissions relative to themarket value of the portfolio.Includesour direct investments in public andprivate equities,and excludes ourinvestment positions in private equityfunds,credit,and other assets.20 Portfolio We

277、ighted Average CarbonIntensity reflects our portfolios exposureto carbon-intensive companies byrevenue,expressed in tCO e/S$Mrevenue.Emissions are allocated basedon portfolio weights(market value of theinvestment relative to the market valueof the portfolio).212Temasek Review 2024 4.Sustainability 4

278、.2 Advancing Sustainability Through Our Portfolio60Broader Engagement with Portfolio CompaniesBeyond engaging with portfolio companies on their decarbonisation journeys,we also work with them on opportunities to drive valuecreation by stepping up Environmental,Social,and Governance(ESG)practices.Thi

279、s includes engaging them through our ESG valuecreation playbook.We proactively promote good governance,ethical business practices,and compliance with applicable laws.We also support ourportfolio companies in building capacity for sustainability leadership and carbon emissions management.Find a more

280、detailed breakdown of our portfolio metrics and targetsFind out more about how we engage our portfolio companies on sustainabilityTemasek Review 2024 4.Sustainability 4.2 Advancing Sustainability Through Our Portfolio61SkIndependent Practitioners ReportIndependent Practitioners Limited Assurance Rep

281、ort on the Selected Portfolio Emissions Metrics ofTemasek Holdings(Private)Limited(“Temasek”)for the financial year ended 31 March 2024We have undertaken a limited assurance engagement in respect of the Selected Portfolio Emissions Metrics,contained in the Temasek Review 2024(the“TR 2024”),for the f

282、inancial year ended 31 March 2024.Selected Portfolio Emissions MetricsMetricFor the financial year ended 31 March 2024Total Portfolio Emissions(in tCO e)21 millionPortfolio Carbon Intensity(in tCO e/S$M portfolio value)73Portfolio Weighted Average Carbon Intensity(in tCO e/S$M revenue)92 Rounded to

283、nearest million tCO e.Rounded to nearest tCO e/S$M portfolio value.Rounded to nearest tCO e/S$M revenue.The basis of preparation for the above Selected Portfolio Emissions Metrics is set out in Appendix I(the“Reporting Criteria”).Our assurance engagement was with respect to the financial year ended

284、31 March 2024.We have not performedany procedures with respect to(i)earlier periods and(ii)any other elements included in the TR 2024,andtherefore do not express any conclusion thereon.Managements ResponsibilityManagement is responsible for establishing suitable criteria for preparing the Selected P

285、ortfolio EmissionsMetrics and for the preparation of the Selected Portfolio Emissions Metrics in accordance with the ReportingCriteria.Management is also responsible for designing,implementing and maintaining internal control over informationrelevant to the preparation of the Selected Portfolio Emis

286、sions Metrics that is free from material misstatement,whether due to fraud or error.The Selected Portfolio Emissions Metrics have been prepared to assist management to report the SelectedPortfolio Emissions Metrics to Temaseks Board of Directors and for inclusion in the TR 2024 using the ReportingCr

287、iteria designed for this purpose.As a result,the Selected Portfolio Emissions Metrics may not be suitable foranother purpose.Practitioners Independence and Quality ManagementWe have complied with the independence and other ethical requirements of the Accounting and CorporateRegulatory Authority(ACRA

288、)Code of Professional Conduct and Ethics for Public Accountants and AccountingEntities(ACRA Code),which is founded on fundamental principles of integrity,objectivity,professional competenceand due care,confidentiality and professional behaviour.Our firm applies Singapore Standard on Quality Manageme

289、nt 1 which requires the firm to design,implement andoperate a system of quality management including policies or procedures regarding compliance with ethical122232122232Temasek Review 2024 Independent Practitioners Report62requirements,professional standards and applicable legal and regulatory requi

290、rements.Practitioners ResponsibilityOur responsibility is to express a limited assurance conclusion on the Selected Portfolio Emissions Metrics basedon the procedures we have performed and the evidence we have obtained.We performed our limited assuranceengagement in accordance with Singapore Standar

291、d on Assurance Engagements 3000(Revised)AssuranceEngagements other than Audits or Reviews of Historical Financial Information and,in respect of greenhouse gasemissions included in the Selected Portfolio Emissions Metrics,Singapore Standard on Assurance Engagements3410 Assurance Engagements on Greenh

292、ouse Gas Statements(collectively the“Standards”).These Standardsrequire that we plan and perform our work to form the conclusion about whether the Selected Portfolio EmissionsMetrics are free from material misstatement.The extent of our procedures depends on our professionaljudgement and our assessm

293、ent of the engagement risk.A limited assurance engagement involves assessing the suitability in the circumstances of Temaseks use of theReporting Criteria as the basis for the preparation of the Selected Portfolio Emissions Metrics,assessing the risksof material misstatement of the Selected Portfoli

294、o Emissions Metrics whether due to fraud or error,responding tothe assessed risks as necessary in the circumstances,and evaluating the overall presentation of the SelectedPortfolio Emissions Metrics.A limited assurance engagement is substantially less in scope than a reasonableassurance engagement i

295、n relation to both the risk assessment procedures,including an understanding of internalcontrol,and the procedures performed in response to the assessed risks.The procedures we performed included inquiries,inspection of documents,analytical procedures,evaluating theappropriateness of quantification

296、methods and reporting policies,and agreeing or reconciling with underlyingrecords.Given the circumstances of the engagement,in performing the procedures listed above we:Evaluated the suitability of the Reporting Criteria as a basis to prepare the Selected Portfolio EmissionsMetrics;Through inquiries

297、,obtained an understanding of Temaseks control environment and the information systemsrelevant to the preparation of the Selected Portfolio Emissions Metrics.However,we did not evaluate thedesign of control activities,obtain evidence about their implementation or test their operating effectiveness;E

298、valuated whether Temaseks methods for developing estimates are appropriate and had been consistentlyapplied.However,our procedures did not include testing the data on which the estimates are based orseparately developing our own estimates against which to evaluate Temaseks estimates;For a limited sa

299、mple of assets,reconciled the emissions data back to the underlying records.However,ourprocedures did not include the corroboration of the underlying greenhouse gas emissions and financial data;andConsidered the presentation and disclosure of the Selected Portfolio Emissions Metrics.The procedures p

300、erformed in a limited assurance engagement vary in nature and timing from,and are less inextent than for,a reasonable assurance engagement.Consequently,the level of assurance obtained in a limitedassurance engagement is substantially lower than the assurance that would have been obtained had a reaso

301、nableassurance engagement been performed.Accordingly,we do not express a reasonable assurance opinion aboutwhether Temaseks Selected Portfolio Emissions Metrics have been prepared,in all material respects,inaccordance with the Reporting Criteria.Inherent LimitationsIn designing these procedures,we c

302、onsidered the system of internal controls in relation to the Selected PortfolioEmissions Metrics and reliance has been placed on internal controls where appropriate.Because of the inherentlimitations in any accounting and internal control system,errors and irregularities may nevertheless occur andno

303、t be detected.The absence of a commonly used generally accepted reporting framework or a significant body of establishedpractice on which to draw to evaluate and measure subject matter allows for different,but acceptable,measurement techniques that can affect comparability between entities and over

304、time.As there are currently nolegislative requirements or regulation prescribing the preparation,disclosure and verification of Temaseksportfolio emissions,the Selected Portfolio Emissions Metrics need to be read and understood together with theReporting Criteria.Temasek Review 2024 Independent Prac

305、titioners Report63The quantification of the greenhouse gas emissions data underlying the Selected Portfolio Emissions Metrics issubject to inherent uncertainty because of incomplete scientific knowledge used to determine emissions factorsand the values needed to combine emissions of different gases,

306、and the estimation uncertainty from themeasurement and calculation processes used to quantify emissions within the bounds of existing scientificknowledge.This can affect the ability to draw meaningful comparison of Temaseks portfolio emissions over time.ConclusionBased on the procedures we have perf

307、ormed and the evidence we have obtained,nothing has come to ourattention that causes us to believe that the Selected Portfolio Emissions Metrics for the financial year ended 31March 2024 are not prepared,in all material respects,in accordance with the Reporting Criteria.Purpose and Restriction on Di

308、stribution and UseThis report,including our conclusion,has been prepared solely for Temasek in accordance with the letter ofengagement between us.To the fullest extent permitted by law,we do not accept or assume responsibility toanyone other than Temasek for our work or this report.Yours faithfullyP

309、ricewaterhouseCoopers LLPPublic Accountants and Chartered AccountantsSingapore1 July 2024Temasek Review 2024 Independent Practitioners Report644.3 Building a Sustainable OrganisationOur focus on sustainability extends from portfolio to planet to people.At Temasek,we strive to foster a company cultur

310、e that embraces sustainability.Reducing Environmental Impact Arising from Our OperationsWe continue to uphold our commitment to carbon neutrality in our operations by harnessing all levers to reduce emissions,and aremaking strides through various initiatives and programmes.Over the year,we saw an in

311、crease in our overall indirect emissions from our operations,mainly due to the resumption of businesstravel post-pandemic.However,we remain judicious on the need for business travel and have introduced several measures to promote sustainable anddisciplined travel practices.These include the introduc

312、tion of a carbon charge for business travel,pegged to our internal carbon price.Our efforts to procure electricity from renewable sources for our UK and India offices,as well as the Renewable Energy Certificatesobtained for our Singapore office,have resulted in a decrease in emissions in relation to

313、 electricity consumption.In 2023,our Singapore office received the Green Mark Award(Platinum)from the Singapore Building and Construction Authority,recognising our efforts to create a more sustainable and resource-efficient office environment.To compensate for residual emissions from our operations,

314、we purchase carbon credits through Climate Impact X.We prioritise carboncredits with higher ratings and more recent vintages for our purchases.We remained carbon neutral in our operations for the fifth year running,as at 31 March 2024.Developing a Diverse,Equitable,and Inclusive InstitutionWe value

315、diversity,equity,and inclusion.We foster an inclusive environment for our employees,one that respects and embracesdifferences across a wide range of dimensions,regardless of gender,age,religion,sexual orientation,nationality,ethnicity,physicalability,or neurodiversity.Guided by our MERITT values,we

316、forge a culture where everyone feels respected,empowered,and is treatedfairly.Our InclusivityTemasek initiatives continue to strengthen our diversity practices and reinforce our culture of belonging.One suchinitiative,Temasek Womens Network,supports and inspires our female staff in their career jour

317、neys.Today,our staff encompass 34 nationalities with a gender mix of 54%male and 46%female.We continue to embrace and work towardsdiversity while ensuring a fair,meritocratic,and inclusive workplace.Read more about how we are reducing the overall environmental impact arising from our operationsTemas

318、ek Review 2024 4.Sustainability 4.3 Building a Sustainable Organisation65Capacity Building and Knowledge SharingOur employees are critical to advancing a more sustainable organisation.We continuously upskill and equip them with diverse skill setsand competencies to navigate an increasingly complex w

319、orld,and to remain relevant for the future.We have also expanded our mandatory learning programmes to include topics such as our approach to sustainability,as well asdiversity and inclusivity.For the year ended 31 March 2024,every staff underwent an average of 35 hours of training.Developing a Cultu

320、re of SustainabilityMore than 90%of our staff took part in sustainability-focused initiatives for the year ended 31 March 2024.These included a self-pacedlearning programme on our sustainability efforts,and activities such as a shoe recycling drive,upcycling workshops,as well asmangrove monitoring t

321、o assess the carbon abatement potential of urban mangrove habitats.Find out more about how we are fostering a company culture that embraces sustainabilityCopyright 2024 Temasek Holdings(Private)LimitedTemasek Review 2024 4.Sustainability 4.3 Building a Sustainable Organisation66Appendix I Reporting

322、CriteriaPortfolio Emissions Metrics:Explanatory Notes on Definitions and Methodology UsedWe report the following portfolio emissions metrics with reference to the Greenhouse Gas(GHG)Protocol,as wellas recommendations of the Task Force on Climate-Related Financial Disclosures(TCFD)for Asset Owners:Me

323、tricDescriptionTotal Portfolio Emissions(in tCO e)The absolute GHG emissions(Scope 1 and Scope 2)associated with our portfolio,expressed in tCO e.Portfolio Carbon Intensity(in tCO e/S$M portfolio value)The GHG emissions associated with our portfolionormalised by the market value of the portfolio,exp

324、ressed in tCO e/S$M portfolio value.Portfolio Weighted Average Carbon Intensity(in tCO e/S$M revenue)The sum of each assets carbon intensity(tCO e/S$M revenue)multiplied by the weight ofthat asset in the portfolio(the market value of thatasset relative to the market value of the portfolio),expressed

325、 in tCO e/S$M revenue.This metric is also known as Total Carbon Emissions(tCO e)within the TCFD Supplemental Guidance for the Financial Sector.This metric is also known as Carbon Footprint(tCO e/$M invested)within the TCFD Supplemental Guidance for the Financial Sector.This metric is also known as W

326、eighted Average Carbon Intensity(tCO e/$M revenue)within the TCFD Supplemental Guidance for the Financial Sector.Our portfolio emissions encompass Temaseks direct investments in public and private equities.Our investmentpositions in private equity funds,credit,and other assets are excluded.The portf

327、olio emissions reported include Scope 1 and Scope 2 emissions of the underlying companies based onthe latest available data sets.We use a combination of company-reported emissions data and modelling approaches to establish our portfolioemissions based on our proportionate shares(i.e.,ownership inter

328、ests)in the assets.We adopt the following hierarchy in data sources as we establish our portfolio emissions,taking into accountavailability and timeliness of reported data:1.Company-reported data:GHG emissions data that is reported by the company,either directly to Temasek ormade available through S

329、&P Global Sustainable1.2.Company-specific estimates:GHG emissions for each company modelled or estimated by Temasek or S&PGlobal Sustainable1 using relevant industry level carbon intensity or carbon efficiency averages as proxies(GHG emissions normalised by revenue/market capitalisation/other releva

330、nt operational unit ofmeasurement).In case industry averages do not provide a meaningful proxy for the company,carbon intensityor efficiency data of comparable peers may be used instead.4225226222425262Copyright 2024 Temasek Holdings(Private)LimitedTemasek Review 2024 Independent Practitioners Repor

331、t67SkInstitutionTemasek Review 2024 5.Institution685.1 Governance&LeadershipWe aspire to do well,do right,and do good,for todays and future generations.Guided by our Purpose,which defines why we do what we do,our Charter sets out who we are and what we do.Incorporated as a company under the Singapor

332、e Companies Act on 25 June 1974,Temasek is wholly owned by the Singapore Ministerfor Finance.Under the Singapore Constitution,Temasek is a Fifth Schedule entity with a constitutional responsibility to safeguard our Companyspast reserves.Temaseks reserves form part of the nations reserves.Temasek own

333、s its assets we are not a fund manager.We do not manage Singapores Central Provident Fund savings,or theSingapore Governments assets,or the foreign exchange reserves of Singapore.Neither does Temasek manage the assets of any otherFifth Schedule entity:these are independently managed by the respective Fifth Schedule entities themselves.Temasek is not state-directed.Neither the President of Singapor