Temasek reports S$46 billion in sustainable living investments, up S$2 billion from 2024

As part of its commitment to sustainability, Singapore’s state investment company Temasek revealed its sustainability report on Jul. 9, alongside its annual financial year review.

This marks only the second time Temasek has disclosed the value of its sustainability-linked investments after the launch of its inaugural report last year.

The report outlines Temasek’s sustainability goals, initiatives, and performance, including ongoing efforts to decarbonise its portfolio and reduce emissions.

As of Mar. 31, 2025, Temasek reported S$46 billion in investments aligned with its “Sustainable Living trend”, an increase of S$2 billion from the previous year.

These make up 11 per cent of Temasek’s net portfolio value.

Meanwhile, total portfolio emissions remained steady at 21 million tonnes of carbon dioxide equivalent (tCO₂e), the same as in 2024.

Sustainable living investments

Over the year, Temasek invested S$4 billion in opportunities aligned with its “Sustainable Living trend”.

The company expects to continue increasing investments in businesses that advance environmental and social objectives.

These investments span established firms, early- and growth-stage companies, and funds, across key areas such as food, water, waste, energy, materials, clean transport, and the built environment.

They fall into two main categories.

Firstly, sustainability-focused investments in companies whose products and services contribute to Temasek’s long-term vision of a "net-zero, nature-positive, and inclusive growth".

Secondly, climate transition investments in high-emitting sectors that are working to shift towards cleaner, more sustainable products and services.

This includes investments in clean energy transition, power and energy infrastructure, and energy transition commodities.

The S$46 billion in sustainable living investments comprises S$39 billion in sustainability-focused investments and S$7 billion in climate transition investments.

Towards net zero

Temasek has previously stated its aim to reduce net portfolio emissions from 2010 levels by half in 2030 and achieve net zero by 2050.

It has been carbon neutral as a company since 2020.

As of Mar. 31, 2025, total portfolio emissions stood at 21 million tCO₂e — unchanged from the previous year, but down 9 million tCO₂e from 2020, when the company first set its climate targets.

The reported emissions cover 77 per cent of Temasek’s investment portfolio.

Five portfolio companies, Singapore Airlines (SIA), Sembcorp Industries, Olam Group, PSA International, and ST Telemedia, accounted for approximately 82 per cent of total portfolio emissions this year.

Temasek noted that increased emissions from SIA, driven by a rise in air travel and cargo demand, contributed significantly to the portfolio’s emissions.

Adjustments to emissions reporting boundaries of certain portfolio companies also played a role.

However, these increases were partly offset by a reduction in emissions from Sembcorp Industries, which transferred its Phu My 3 Power Plant, a gas turbine facility located in Vietnam, to Vietnam Electricity, and by ongoing decarbonisation efforts and portfolio changes.

Engaging portfolio companies

Temasek has not used carbon credits to offset its total portfolio emissions to date.

Instead, Temasek said in its report that it "focus[es] [its] efforts on engaging portfolio companies on their decarbonisation pathways and supporting the development and introduction of decarbonisation solutions, where relevant and feasible."

Given the global shift towards a net-zero economy and the physical risks posed by climate change, Temasek said it is in its interest to encourage its major portfolio companies to adopt “effective climate change mitigation and adaptation measures”.

In the past year, Temasek engaged with 17 major portfolio companies, accounting for 91 per cent of its total portfolio emissions, at the board and CEO level.

14 of these companies have set targets to reach net zero by 2050 or earlier, up from eleven last year.

For example, the SIA Group has been increasing its procurement of sustainable aviation fuels (SAF) and signing long-term supply agreements.

This includes a May 2024 agreement with Neste, a producer of SAF, to purchase 1,000 tonnes of neat Neste SAF.

A further agreement SIA Group made in March 2025 to acquire 1,000 tonnes of Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)-certified SAF.

Neste's SAF is made from sustainably sourced renewable waste and residues such as used cooking oil and animal fat waste.

It claims to be able to reduce emissions by up to 80 per cent over the fuel's life cycle.

Community gifts for climate action

On the community front, Temasek continues to allocate a portion of its net positive returns above the risk-adjusted cost of capital towards community gifts.

Last year, it committed S$100 million as Concessional Capital for Climate Action (CCCA) to support marginally bankable climate projects.

“CCCA represents a novel way of advancing Temasek’s deployment of philanthropic capital, going beyond conventional grantmaking, and a deepened commitment towards the climate agenda,” they said.

Top photo from Temasek and NParks website