Abu Dhabi’s Mubadala's said its assets under management (AUM) rose 9.5% in 2023 to AED 1.11 trillion ($302.2 billion). The sovereign wealth fund is planning to double the size of its portfolio in the coming decade.  

In its annual review issued on Friday, the fund said its five-year rate of return stood at 10.3%, up from 8.5% in 2022.

Mubadala is Abu Dhabi’s second biggest wealth fund, after the Abu Dhabi Investment Authority (ADIA), and has the mandate to help diversify its economy from fossil fuels.

In 2023, Mubadala accelerated its shift towards targeted investments that will shape the future economy of the UAE, the fund said in the report.

"Our group-wide focus on responsible investing to deliver impact with key partners highlights the increasing role of sovereign funds as enablers of progress, not just asset allocators," said Khaldoon Khalifa Al Mubarak, Managing Director and Group CEO.

"Our focus on industries of the future such as AI mirrors the proactive stance we took on renewable energy in 2006, which resulted in Masdar becoming one of the world's fastest-growing clean energy companies and an enabler of the energy transition for over seventy countries."

Mubadala is now embarking on a "new phase of responsible AI stewardship as a founding partner of MGX, where we are committed to harnessing cutting-edge technologies to forge new economic pillars for the nation and benefit society globally".

The fund deployed AED 89 billion ($24 billion) in a range of sectors shaping the future, including artificial intelligence, technology, digital infrastructure, life sciences and clean energy, while growing its private credit business.

Mubadala reported proceeds of AED 99 billion ($27 billion) last year, versus AED 105 billion ($29 billion) in the previous year, including "divestments of certain legacy assets and capital recycling into priority investment areas in line with strategy and responsible investing agenda".

Its portfolio profile included 38% in private equity, 25% in public markets, 16% in real estate, and 16% in alternatives.

Group Chief Financial Officer, Carlos Obeid, said: “In 2023, global markets experienced significant turbulence across various sectors and industries, driven by rising interest rates, inflationary pressures, geopolitical tensions, and supply chain disruptions. Despite these challenges, our five-year rate of return stood at 10.3%.”

(Reporting by Brinda Darasha; editing by Seban Scaria)