HOW MIGHT CLIMATE RISKS AFFECT INVESTOR PORTFOLIOS? Perhaps the most challenging, pervasive, and enduring of all the risks that the global economy is confronting is climate change. Climate change poses two key risks to investors’ portfolios: First, physical risks arise from the impact of climate hazards on a company’s operations, supply chains and consumer markets. Companies can mitigate this by putting in place adaptation measures through de-risking, re-shoring, and diversification. Second, transition risks arise from the impact of higher carbon prices, stricter environmental standards, shifts in consumer preferences, and advances in lowemissions technologies. This will require transforming carbon-intensive business activities and processes — before regulation bites, competitiveness suffers, and assets become stranded. Assessing portfolio companies’ vulnerabilities to climate change is becoming an integral part of business planning and shareholder engagement. Climate change is already happening. It is no longer a question of ‘whether it will happen’ but ‘how much’ and ‘how fast’. The trajectory of both physical and transition risks is highly uncertain. Global carbon emissions have not peaked. At the same time, commitments towards achieving netzero have never been stronger, foreshadowing stronger policy actions and growing clean energy investments. It is within this wide spectrum of possible outcomes that investors will need to make portfolio allocation decisions. INVESTMENT PIVOTS FOR PORTFOLIO RESILIENCE  Against the backdrop of these four short-term to long-term uncertainties, the overall investment environment has deteriorated. Return prospects are lower, and risks are higher.

Speeches  Published Date: 20 September 2022  "Critical Economic Uncertainties" - Keynote Speech by Mr Ravi Menon, Managing Director, Monetary Authority of Singapore, at the SuperReturn Asia Conference on 20 September 2022 Ladies and gentlemen, good morning. I am happy to join you at the SuperReturn Asia Conference — the first time the conference is being held fully in person since the start of COVID-19, and the first time here in Singapore. Uncertainty has become the dominant theme in investment today. Let me touch on four key uncertainties around the global economy: first, how severe will the economic downturn be next year? second, where is inflation headed in the medium term? third, how will geopolitical tensions impact the global economy? fourth, how might climate risks affect investor portfolios? HOW SEVERE WILL THE ECONOMIC DOWNTURN BE NEXT YEAR? The global economy is facing a severe bout of inflation with two positive stimuli to demand coming up against two negative supply shocks. On the demand side, the lagged effects of the massive fiscal and monetary stimulus in response to the pandemic coupled with the unleashing of pent-up demand following the re-opening of economies have substantially added to general inflationary pressures. Supply disruptions stemming from the lingering effects of the pandemic and the Russia-Ukraine war have sharply driven up global food, energy, and commodity prices. The surge in inflation has necessitated monetary policy tightening by central banks, at a pace not seen in the last four decades.