Valuation of unlisted assets considered in reviewing GIC and Temasek portfolio risks: Second Minister for Finance Lawrence Wong

The government takes into account the valuation of unlisted assets in GIC and Temasek such as private equity, infrastructure, and real estate when reviewing the overall risks of its whole portfolio of assets, said Minister for National Development and Second Minister for Finance Lawrence Wong on Tue (6 Aug).
Responding to a Parliamentary question from Workers’ Party (WP) Member of Parliament (MP) Leon Perera regarding the valuation of unlisted assets in the two sovereign wealth funds (SWFs), Mr Wong said that the valuations are “regularly updated”, and are “in accordance with international accounting standards”.
He added that there is also an annual independent audit of the valuation methodology, and that the independent auditors have not raised any issues to date.
Mr Perera then asked if the government would consider requiring the sovereign wealth funds “to also publish a more conservative figure for valuing the unlisted assets based on the cost of acquisition”, given that the valuations “have been associated with certain amount of volatility”.
In response, Mr Wong stated that “the existing accounting standards are already conservative”, necessitating the valuers to ensure reasonableness and test for impairment.
Currently, Temasek only provides lists of companies that it makes major investments in, classified by industry, and generally states that it has “a 60:40 underlying exposure to mature economies and growth regions” in its portfolio, while GIC does not indicate explicitly its investments, as observed from its website.
Meanwhile, Norges Bank Investment Management (Norway GPFG) — the SWF of Norway and currently the largest SWF in the world — provides a comprehensive and interactive list of its investments by year, region, country and asset class — equities, fixed income, real estate and industry — on its website for the public’s perusal, as seen below:

Norway GPFG currently holds a value of US$1.1 trillion (S$1.5 trillion) in assets managed presently, while GIC and Temasek are valued at USD$440 billion (S$607 billion) and USD$313 billion (S$519 billion) respectively. 
Annual salary of the CEO of the world’s largest SWF made public knowledge; GIC and Temasek top management salaries still kept in the dark?
Earlier in May this year, WP MP Png Eng Huat raised a question in Parliament as to whether there is a maximum threshold for the salaries of key management staff of GIC and Temasek, as well as the range of total annual remuneration, including salary, annual and performance bonuses paid to the top three highest paid executives in GIC and Temasek for the past five years respectively.
Mr Wong replied that as GIC and Temasek are commercially-run companies, the remunerations of their staff are therefore “decided independently by their respective boards”.
“The Government maintains an arms-length relationship with the companies and does not interfere in their operational decisions such as remuneration. Instead, we hold the boards accountable for their respective performances.
“Broadly speaking, both entities adopt remuneration frameworks that are based on performance and industry benchmarks. The salaries are benchmarked to the relevant markets and sectors where the entities compete for talent. This ensures that they can attract and retain capable people,” he said.
He added that the remuneration systems currently implemented by GIC and Temasek “aim to support and reinforce a prudent risk-taking culture”.
“A portion of the remuneration in both entities is tied to long-term performance. This ensures that staff, including senior management, are rewarded for long-term sustained performance, rather than a focus on short-term gains,” said Mr Wong.
However, the question as to how much the senior management of both SWFs are paid remains unanswered.
It is made public knowledge that the annual salary of Yngve Slyngstad, the CEO of Norway GPFG, is US$810,000 (approximately S$1.1 million), and as seen earlier, Norway’s SWF’s website lists in detail every investment made since 1998, when the Norwegian SWF made its first investment.
While it is important for any SWF to retain some element of secrecy in relation to its finances, it should not also be the case such as with Temasek, where details of its investments — including its CEO’s annual remuneration — is classified as a State secret.