Temasek-Backed Firm Accused of Greenwashing in India Coal Sale

One of Singapore’s best-performing stocks this year — an energy company backed by state investor Temasek Holdings Pte — is under fire for trying to avoid higher interest payments to bondholders that kick in if the company fails to meet emissions targets.

In order to reduce its official carbon footprint, Sembcorp Industries Ltd. sold two coal-fired power plants to an Omani group for $1.5 billion. The company told shareholders that the sale would lower its greenhouse gas emissions intensity by 38%, more than enough to dodge the penalties attached to the company’s sustainability-linked bonds.

But the firm financed the sale of the assets ...