100%


2019/20

Report Highlights

CEO Letter

“We have been preparing for a challenging investment environment for some time and our defensive position has helped in navigating the current turmoil. We remain vigilant, guided by our mandate, values and investment principles. We are ready to face an uncharted future, and will continue to invest the nation’s foreign reserves prudently.”

Lim Chow Kiat, CEO

Read more

Performance

Read more

Delivering resilient long-term returns

Over 20 years up to 31 March 2020, the GIC Portfolio’s annualised nominal and real (above global inflation) returns were 4.6% and 2.7% respectively every year.

Annualised rolling 20-year real rate of return of the GIC Portfolio since 2001

%

6

4

2

0

Year ended 31 March

Nominal annualised return & volatility of the GIC Portfolio (in USD, for periods ending 31 March 2020)

Time Period

Nominal Return

Volatility

20-Year

4.6%

9.0%

10-Year

5.2%

8.0%

5-Year

3.9%

7.0%

We have continued to deliver steady, resilient returns due to our diversified asset composition and our increasingly cautious and defensive stance in recent years.

Prior to COVID-19, we had observed high valuations, weakening market fundamentals, rising geopolitical tensions, and limited policy room to manage an economic downturn. Accordingly, we lowered our portfolio risk by reducing our allocation to equities in favour of cash, and factored in recession considerations when evaluating our investment transactions.

The asset mix reflects GIC’s defensive stance heading into the pandemic, which helped to cushion our portfolio against the market volatility.

Asset mix (31 March 2020 vs 31 March 2019)

Total

2020

15.0%

%

31 March 2020

31 March 2019

Performance

Read more

Sustainability

Read more

We believe that companies with stronger sustainability practices will generate better risk-adjusted investment returns over the long term, and this relationship will strengthen over time.

GIC’s O-D-E framework

Enterprise Excellence See more Defence See more Offence See more Framework O-D-E Procuring sustainably Encouraging responsible consumption Fostering collaboration and inclusion Aiming to become carbon-neutral in our operations by FY20/21 Regularly screening our existing portfolio for ESG issues Conducting additional due diligence for companies exposed to greater sustainability risks Actively engaging our portfolio companies Supporting the Task Force on Climate-related Financial Disclosures (TCFD) Integrating sustainability factors into our investment processes Investing in thematic opportunities arising from climate change Incorporating sustainability signals into quantitative strategies
Enterprise Excellence Expand Defence Expand Offence Expand Framework O-D-E Procuring sustainably Encouraging responsible consumption Fostering collaboration and inclusion Aiming to become carbon-neutral in our operations by FY20/21 Regularly screening our existing portfolio for ESG issues Conducting additional due diligence for companies exposed to greater sustainability risks Actively engaging our portfolio companies Supporting the Task Force on Climate-related Financial Disclosures (TCFD) Integrating sustainability factors into our investment processes Investing in thematic opportunities arising from climate change Incorporating sustainability signals into quantitative strategies
Enterprise Excellence Defence Offence Framework O-D-E

Offence

  • Integrating sustainability factors into our investment processes

  • Investing in thematic opportunities arising from climate change

  • Incorporating sustainability signals into quantitative strategies

Defence

  • Regularly screening our existing portfolio for ESG issues

  • Conducting additional due diligence for companies exposed to greater sustainability risks

  • Actively engaging our portfolio companies

  • Supporting the Task Force on Climate-related Financial Disclosures (TCFD)

Enterprise Excellence

  • Procuring sustainably

  • Encouraging responsible consumption

  • Fostering collaboration and inclusion

  • Aiming to become carbon-neutral in our operations by FY20/21

To ensure our continued performance over the long term, GIC organizes major thematic changes such as sustainability using a holistic framework called O-D-E, where O refers to going on the Offensive when it comes to investment opportunities, D indicates Defensive risk management, and E is the manner in which we constantly improve our operations and processes to achieve Enterprise Excellence.

Sustainability

Read more

Feature Article

Read more

A changing global investment environment

The global community is facing a public health crisis, an economic crisis, and financial turmoil all at once – an unprecedented combination in modern times. Extreme safe-distancing measures have resulted in the deepest global downturn since World War II. The COVID-19 crisis has brought to the fore various market vulnerabilities and accelerated several shifts that could shape the global investment landscape going forward.

How GIC is responding to this changing environment

Periodic crises are a feature of global financial markets and an unavoidable fact of investing for the long term. We harness lessons from our investment history to respond to current challenges:

The investment uncertainties that result from the pandemic will require vigilance, agility, and resilience for the journey ahead. We continue to adhere to our core values and investment principles, refine our playbook and processes, and do our best to achieve steady long-term returns on the reserves under our management.

Feature article

Read more

People

Read more

Our values and building confident communities

Our people and values serve as our organizational compass. We develop our people to enable our success, foster a diverse and inclusive culture, and give back to Singapore by building confident communities. We are committed to developing an understanding of long-term value among Singaporeans. The belief of inclusion extends to our community programmes which deliver long-term impact through a multiplier effect to build confident communities. 

People

Read more

More sections

  1. 1

    The GIC Portfolio rates of return are computed on a time-weighted basis, net of costs and fees incurred in the management of the portfolio.

  2. 2

    Volatility is computed using the standard deviation of the monthly returns of the GIC Portfolio over the specified time horizon.