2022-23 SGI CANADA Annual Report

Consolidated Statement of Financial Position Total assets Key asset account changes: Investments (thousands of $) March 31 2023 March 31 2022 Change $ 2,122,378 $ 1,982,924 $ 139,454 1,461,881 1,351,320 110,561 Investments The carrying value of investments increased by $110.6 million during the year due to the investment of operating cash flows and positive investment returns. The Corporation's investment strategy is based on prudence, regulatory guidelines and claim settlement patterns, with a view to maximizing long-term returns by utilizing a conservative investment portfolio. The Board of Directors reviews SGI CANADA's and each subsidiary's asset mix strategy annually through a detailed assessment of each portfolio's risk tolerance. The asset mix strategy takes into consideration the current and expected condition of the capital markets, and the historic return and risk profile of various asset classes. To achieve the long-term investment goals, the portfolio must invest in asset classes that provide an attractive risk-return profile over the medium to long term. Over shorter periods, however, performance of these asset classes can be volatile. The Corporation believes a diversified asset mix and longer-term focus remains appropriate, balancing the need for capital preservation in the short term with the desire for portfolio growth over the longer term. The asset mix strategy is formally documented in the Statement of Investment Policies and Goals. In addition to capturing the asset mix strategy, this document provides guidance on permissible investments, quality and quantity guidelines, conflicts of interest, related party transactions and investment performance expectations, among others. Management monitors and enforces compliance with the investment policy. No material compliance deviations were noted during the year. The Corporation's investment portfolio is managed by external investment managers. The portfolio is invested in short-term investments, bonds, mortgages, equities and Canadian commercial real estate. Equities consist of Canadian, global and global small capitalization mandates. Except for segregated bond mandates, all equity and real estate investments are held through investment funds. SGI CANADA Asset Mix as at March 31, 2023 60% 50% 40% 30% 20% 10% 0% 10.7% 10.0% 52.4% 50.0% 11.6% 15.0% 5.4% 5.0% 12.7% 12.5% 2.3% 2.5% 4.9% 5.0% Short-term investments Bonds and debentures Mortgages Canadian equities Global equities Global small cap equities Real estate Portfolio weight Benchmark weight 20 2022-23 SGI CANADA Annual Report

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