SINGAPORE - Sovereign wealth fund GIC has set up a dedicated sustainability office to deepen its research into key issues.
The Sustainability Office, set up in June, will drive sustainability integration across GIC's investments and corporate processes.
"We will be bringing together existing resources who are working on sustainability, and also to recruit more dedicated sustainability professionals. This unit will work with other sustainability capabilities across our investment and corporate teams to deepen and accelerate GIC's overall sustainability efforts," said the fund.
To drive the transition to low-carbon emissions, GIC said it has not only actively invested in new technologies, such as green hydrogen, carbon removal and even nuclear fusion, but is also supporting the transition efforts of entities it invests in.
By way of examples, it cited green fuels firm InterContinental Energy and United States-based company Divert, which focuses on solving the retail grocery industry's waste problems.
"We divest as a last resort," GIC said in its annual report, adding that it ultimately seeks to speed up decarbonisation of the real economy.
Given that businesses in different jurisdictions have different challenges, instead of mandating a specific timeline for these firms to move away from carbon, it would be better to engage selected firms, especially those in which GIC has a higher shareholding, said chief executive Lim Chow Kiat.
"We would explain to them the importance of this and sometimes we can get to a concrete plan on how they would be moving along that transition path," Mr Lim said.
Another way to push the low-carbon transition is to invest in new technologies or early-stage companies because "if actually they succeed, they can really move the needle", he added.
Another initiative is the sustainable investment fund that GIC established in 2020.
It is a dedicated investment portfolio that spans public and private market investment groups to accelerate sustainability integration across all asset classes and to invest in related opportunities that would generate good returns over time.
The new sustainability office is being led by Ms Rachel Teo, who is head of sustainability in GIC and a member of the group's sustainability committee. She joined GIC in 2005.
Separately, on the topic of blockchain technology and digital assets, the group's chief investment officer Jeffrey Jaensubhakij said these are potentially a set of technologies that could disrupt the current intermediaries market, the way e-commerce disrupted retail.
That, he said, is different from saying cryptocurrency is an asset class.
GIC has not invested in crypto itself but has stakes in companies that provide services in the digital asset space, said Dr Jaensubhakij.
The fund noted that there is a rising need for trust and safety mechanisms to allow the ecosystem to succeed.
"As such, GIC's investments have been focused on the trust and safety aspects of the ecosystem, as seen through our investments in (crypto platform) Anchorage and (blockchain data platform) Chainalysis," it said.