Very likely the junction temperature, so chip edge was around 10-15C cooler or 99-104C. If 114C was chip edge, there'd be some seriously concerning junction temperatures and you'd very likely see instability or full-on overheat protection screen.
Still, Apple is running their silicon to nearly the maximum limit of 115C for logic silicon. This does cause degradation, but since Apple's M3 doesn't clock high, it's not a huge concern. It can probably run this way and still last up to 4-5 years (barring no solder ball failures or any other ancillaries like VRM and such) with adaptive VFS that compares running logic transistors with reference transistor logic.
Toward the end of projected silicon life, it will likely not reach maximum boost of 4.05GHz due to the effects of electromigration and will use more power to achieve lower clocks and reduced performance. This is a design choice, as many of these products will likely be recycled after 5 years, with a vast majority being traded-in after only 2 years.