June 14, 2011

Hedge Fund Group Issues Guidance on Governance

Subodh Mishra of ISS’s Governance Exchange reports:

The primary association for hedge funds, the London-based Alternative Investment Management Association, released new guidance on May 31 that includes recommendations on ways hedge funds can better govern themselves in line with institutional investor expectations. “A Guide to Institutional Investors’ Views and Preferences Regarding Hedge Fund Operational Infrastructures” was drafted by members of the investor community and encompasses five discrete sections covering governance, risk, investments, capital, and operations.

The governance section was authored by Luke Dixon of the Universities Superannuation Scheme and outlines the “fundamental importance of good governance, key constitutional documents and the role of boards of directors.” Kurt Silberstein of the California Public Employees’ Retirement System authored the section on investments, which discusses performance reporting, terms and conditions, control of assets, and transparency.