In conversation with Weixiang Wang, Director, ESG Investment Management, Temasek
Q: How is ESG integrated into Temasek’s investment strategy and decision-making processes?
Weixiang Wang: At Temasek, we integrate an ESG framework across the entire investment process, from pre-investment due diligence to post investment engagement for all our investments. When we assess new investments, we look at how companies perform against peers on key ESG indicators, as well as broader sustainability trends that could affect their competitiveness. We evaluate each investment against a consistent set of core ESG topics – everything from climate and environmental risks to social impact and governance practices—these topics are deemed universal and fundamental for us to obtain a baseline understanding of the company’s ESG awareness and practices.
Take climate, for example. We’ve introduced an internal carbon price – of US$65 per tCO2e and expect this to gradually increase to US$100 per tCO2e by 2030 – to internalize the carbon externalities. Besides the core matrix of climate and social, our investment teams will also assess materiality-based ESG topics depending on the company’s sector and business model, leverage our sector- and issue-based ESG guidelines. Key insights and findings are incorporated into the overall investment assessment for review and approval by the relevant investment committees.
Once an investment is made, the work doesn’t stop there. Our investment teams continue to engage with portfolio companies to ensure any identified follow up actions are taken. Where relevant, we have an ESG Value Creation Playbook that guides our investment teams to identify and drive ESG value creation opportunities across our portfolio. It includes key ESG levers where a company’s strategy and operations can be strengthened to increase resilience, improve competitiveness, enhance access to capital, or position itself for new growth opportunities.
Q: What goes into this value creation playbook?
Weixiang Wang: When we first started our ESG journey over five years ago, the focus was mainly on managing risks. But as our portfolio evolved, we began to see how ESG could also unlock real value. That’s what led us to create our ESG value creation playbook.
It’s built around four core ideas, where ESG can drive tangible value:
Over time, we’ve refined this playbook using lessons from our portfolio and global best practices, including insights from the UN Principles for Responsible Investment (on Sustainability Value Creation). It’s now a living framework that guides how our teams – and our portfolio companies – think about value creation in a changing world.
Q: How does Temasek navigate evolving global ESG narratives, including differing regional perspectives?
Weixiang Wang: It’s hard to talk about ESG today without acknowledging the reality—we are already at a point of climate crisis. We can see it everywhere: wildfires in California in the US, snowstorms in Beijing in China, and other extreme weather events across the globe.
From a regional perspective, Asia sits at the heart of both the challenge and the solution. The region accounts for over half the world’s population and includes some of the biggest emitters globally – yet it’s also among the most vulnerable to climate impacts.
That’s why we believe the global movement against climate change will largely be won or lost in Asia. And as a firm rooted in Singapore, we feel a deep responsibility to play our part.
For us, it’s about staying the course and remaining committed to our sustainability and climate goals—even when the global narrative shifts or becomes politicized. Success isn’t just about financial returns; it’s about translating value creation into the well-being of our people, portfolio companies, partners—and the broader communities and planet we share as a common home.
Q: How does Temasek assess ESG risks and opportunities across supply chains of portfolio companies?
Weixiang Wang: We’ve been paying much closer attention to ESG risks and opportunities in supply chains – and for good reason. Supply chains are where many of the biggest environmental and social impacts occur.
Our engagement with portfolio companies now routinely includes discussions around their supply chain resilience, climate risk and social practices. For example, physical climate risks – such as floods and heatwaves – can disrupt production and logistics, directly impacting financial performance. As climate disclosure requirements expand, understanding these risks is becoming essential.
We’ve also integrated a social baseline risk assessment into our ESG framework. This builds on a successful pilot program we ran last year and includes a set of core social business practices that we encourage investment targets and portfolio companies to adopt—both in their own operations and across their supply chains. It focuses on issues such as human rights, labor practices, inclusion, and workforce well-being.
Beyond that, we also examine topics like product safety, data privacy and security—all of which are critical to responsible business. Our goal is to help companies identify where risks lie, but also where opportunities exist to create long-term value.
Read more in the Asia Funds ESG + Sustainability Survey 2025 Report.