Hedge Fund Standards Board Inks Agreement with Sovereign Wealth Forum

Apr 4 2016 | 3:26pm ET

A new agreement announced today between the Hedge Fund Standards Board and the International Forum of Sovereign Wealth Funds (IFSWF) will help ensure sovereign wealth funds have an adequate voice in the standards and practices and the hedge fund industry in which they invest.

The agreement forms a mutual observer relationship, according to an HFSB statement. The relationship will help ensure that sovereign wealth funds are active participants in HFSB activities and in the standard setting process, while also enabling the HFSB to offer insights and information to the sovereign wealth fund community on hedge fund industry issues.

The IFSWF is a global network of sovereign wealth funds established in 2009 to enhance collaboration, promote a deeper understanding of SWF activity and raise the industry standard for best practice and governance. The Form counts 31 member funds which collectively manage approximately $ 5.5 trillion, or 80% of assets managed by sovereign funds globally. It has similar arrangements with the IMF Fund and the World Bank.

The new arrangement will allow members of each organization to participate in the events of the other, create constructive dialogues between hedge fund managers and SWFs to explore alignment of interests, and collaborate on issues of mutual interest, such as governance, transparency and stability.

In addition, the resources of the HFSB, including its Standards and Toolbox offerings, will become more accessible to the SWF community. 

“We are delighted to form a closer relationship with the HFSB to share knowledge and experience with the objective to raise Standards in the financial industry,” said Adrian Orr, IFSWF Chair and CEO of the $20 billion New Zealand Superfund, in the statement. “This relationship will help ensure that sovereign wealth funds have a voice in the hedge fund standard setting process.”

“The interests of the HFSB and IFSWF are very much aligned, particularly in the areas of transparency, good governance and financial stability,” added Dame Amelia Fawcett, chairman of the HFSB. “The HFSB relies on hedge fund managers and investors to work together to set industry standards, and we welcome closer dialogue with sovereign wealth funds, which are a large and influential hedge fund investor group.

The HFSB was set up in 2008 as the standard-setting body for the hedge fund industry and now has a growing membership internationally in both Asia and North America. The HFSB is supported by more than 120 hedge fund managers with $800 billion in aggregate assets, and by more than 60 institutional investors investing $600 billion in hedge funds.

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