100%
2020/21
— Lim Chow Kiat, CEO
Over 20 years up to 31 March 2021, the GIC Portfolio’s annualised nominal and real (above global inflation) returns were 6.8% and 4.3% respectively per 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 and volatility of the GIC Portfolio (in USD, for periods ending 31 March 2021)
|
Time Period |
Nominal Return |
Volatility |
|---|---|---|
|
20-Year |
6.8% |
8.8% |
|
10-Year |
6.2% |
7.5% |
|
5-Year |
8.8% |
6.6% |
We continue to deliver steady, resilient returns. The rolling off of the FY2000/01 returns arising from the dot-com crash coupled with a strong rebound in risk assets over the past year contributed meaningfully to this year’s 20-year return.
Our diversified portfolio approach and cautious investment stance helped to cushion GIC’s performance from the market correction that occurred in 1Q 2020. This posture has continued into FY2020/21 given elevated asset valuations and uncertainty arising from potential inflationary pressures. We have maintained our emphasis on being prepared for multiple scenarios, maintaining price discipline, adding optionality and expanding our bottom-up investment activities.
Beyond our ability to invest directly, we also work with external partners to enhance our capabilities. These partnerships have expanded our network, widened our perspectives, and deepened our operating expertise. Our approach builds on our strengths:
Long-term and flexible capital
Capacity to execute co-investments
Global connector, particularly to Asia
Multi-faceted investment partnership
Constructive engagement and sharing of network
By offering long-term capital, internal and external expertise, and global connections, we strive to add meaningful value to our partnerships and investments. Amidst the challenging investment environment, we see being a partner of choice as critical for our mission.
While expansionary policies and the COVID-19 vaccination rollout are expected to boost global growth sharply in the near term, significant uncertainties remain around the pandemic trajectory, inflation risks, and very high debt levels.
Looking ahead as we transition to a post-pandemic world, there are three major underlying trends that will drive markets and open up new growth opportunities for GIC.
Accelerating technological transformation
Sustainability
Growing influence of geopolitics on the capital markets
As a long-term investor, we believe that it is more constructive to actively support companies in their transition towards greater sustainability, and that we can create more beneficial outcomes for our stakeholders over the long term by engaging companies on how to operate more sustainably.
— Liew Tzu Mi, Chief Investment Officer for Fixed Income & Chair, Sustainability Committee
Sustainable Investment Fund
GIC’s Sustainable Investment Fund (SIF) was launched in July 2020 as a dedicated portfolio to accelerate sustainability integration across all asset classes. Coordinated across the public and private markets, the SIF seeks to invest in sustainability leaders and companies with the potential to successfully transition towards more sustainable paths.
Achieving Carbon Neutrality
In FY2020/21, GIC achieved our goal of becoming carbon neutral across our global operations in our 10 offices around the world.
Progress through Partnerships
We welcome progress in global initiatives that help investors and companies make better long-term decisions. In the past year, GIC became a signatory to CDP, Climate Action 100+, and the Asia Investor Group on Climate Change (AIGCC), important organizations and initiatives charged with climate change management.
Feature Article
At GIC, people are our biggest investment. As we pursue our mission, we are anchored on our organizational PRIME values, as well as an unwavering concern for our people’s well-being. Our belief of inclusion extends to our community programmes, which are designed to deliver long-term impact. As local communities continue to be hit hard by the pandemic, GIC has stepped up social impact efforts.
‘With Love, GIC’ Initiative
In recognition of GICians’ desire to support impacted communities, we started ‘With Love, GIC’ – a S$1.05 million initiative that supports ground-up projects and are led by employees across our 10 global offices. To date, ‘With Love, GIC’ has funded close to 100 projects co-created by GICians with community partners.
Champion of Good
In 2020, GIC was recognised as a Champion of Good by the National Volunteer and Philanthropy Centre (NVPC) in Singapore under the Company of Good programme.
Gift A Tree
To commemorate GIC’s 40th anniversary, all GICians will plant a tree to demonstrate support for GIC’s commitment to sustainability. Our people are instilled with the mindset to care for the environment and its biodiversity as long-term assets that benefit future generations.
Enabling Future-Ready Leaders
To increase financial literacy among youths in Singapore and equip small and medium-sized enterprises (SME) with the skills to take on long-term challenges, we collaborate with like-minded organizations to roll out programmes and curricula to develop future-ready Singaporeans.