Connect with us

Transparency Still Remains Elusive for Most Sovereign Wealth Funds

Jose Filomeno de Sousa dos Santos

This article was contributed by the Fundo Soberano de Angola (FSDEA).

Despite the obvious developments that Sovereign Wealth Funds (SWF) have brought both to the global economy and their home countries, there can be no denying that the term SWF is often met with suspicion and negative attention. There is a plethora of reasons why the growth and significance of SWFs and their influence on global capital markets has attracted these misgivings. This sentiment is certainly understandable in a world still trying to come to terms with the rapid pace of globalisation. However, what is unforgiveable is that much of the negative sentiment directed towards SWFs is entirely of their own making. Despite many notable exceptions and attempts by industry bodies to introduce standards and guidelines, such as the SWFIs Linaburg-Maduell Transparency Index and the IMFs Santiago Principles, many SWFs are still accused of operating with a lack of investment transparency and do not come close to meeting acceptable standards of corporate governance. Unfortunately, the actions of some tarnish the image of all SWFs.

This is a situation that clearly must be addressed for the long-term good of all SWFs; it is not enough for our industry to just sit back and accept this situation as a given. This is why the Fundo Soberano de Angola (FSDEA), the newly launched sovereign wealth fund, wholly owned by the Republic of Angola, pledged at its official launch in Luanda to make transparency the bedrock of its foundation and to strive to set a benchmark for all Sovereign Wealth Funds operating in the region. Whilst the Fund continues to finalise its Investment Strategy and Social Charter, the Board of Directors has understood that it must start to evidence the commitment to transparency for it not to be seen as an empty promise. This is why the Fund has taken the bold step of publishing key disclosure milestones, which it is committed to meeting in 2013 and 2014. The publication of these milestones is just the first stage in the Fund’s absolute commitment to being fully transparent and accountable to the people of Angola and to the social and economic development of the country.

In addition to meeting these disclosure milestones, the Fund is also committed to providing regular updates to international markets on material events, such as major investments, selection of external advisors and other significant developments.

Overseeing all of these commitments to transparency and accountability is a three-member Board of Directors and an independent Advisory Council, which includes: the Minister of Finance; the Minister of Economy; the Minister of Planning and the Governor of the National Bank of Angola. The Fund’s performance will also be regularly assessed by the Angolan government’s Fiscal Council, providing additional independent oversight.

The Fund is fully aware that these steps alone are not going to assuage the concerns of all; however, they are an extremely important part of the process, a process that the FSDEA hopes to lead by example through addressing some of the negative perceptions that the industry faces.

FSDEA DISCLOSURE MILESTONES

  • First quarter 2013 – Publication of the FSDEA Social Charter (the Charter will address a number of key social challenges faced by Angolans)
  • First quarter 2013 – Publication of the Government approved FSDEA Investment Policy
  • Second quarter 2013 – The appointment of internationally recognized independent auditors
  • Third quarter 2013 – The FSDEA mid-year update to include executive commentary on investment activities
  • First quarter 2014 – The FSDEA annual report
  • First quarter 2014 – First Linaburg-Maduell Transparency Index FSDEA rating
  • Third quarter 2014 – The FSDEA mid-year update to include executive commentary on investment activities

Ardian Auctions Off €1 Billion in Infrastructure Assets to APG

French private equity giant Ardian has auctioned off an undisclosed stake in a portfolio of European infrastructure assets valued at €1 billion to Dutch asset owner manager APG Investments. APG, which first invested in the portfolio in 2006, plans on buying out partnership interests in the portfolio held by other investors. French multinational insurance firm AXA SA will retain its stake as a co-owner of the portfolio alongside APG, with Ardian staying on as asset manager and advisor. The transaction remains subject to regulatory approval.

[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Continue Reading

Tribal Council Approves Cherokee Nation Sovereign Wealth Fund Act

Tahlequah, Oklahoma-based Cherokee Nation Tribal Council approved the creation of the Cherokee Nation Sovereign Wealth Fund Act to establish a fund to ensure the continuation of tribal operations and the general welfare of tribal citizens.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Continue Reading

Temasek Participates in Series D Round in Chinese Mafengwo Travel Platform

Image Source: Screenshot from Website – December 12, 2017

Chinese social travel platform Mafengwo has raised US$ 133 million in a Series D funding round with aid from new investors, including private equity investor General Atlantic, tourism-centric Ocean Link, the Yuantai Changqing venture capital fund, Hopu Investment Management, and Singapore’s Temasek Holdings. Existing investors Capital Today, Qiming Venture Partners, and Hillhouse Capital also participated in the latest funding round.

Founded in 2010 by chief executive Gang Chen and chief operations officer Gang Lv in 2010, Mafengwo is popular among the Chinese millennial demographic, who use the app to look up travel information and booking services for nearly 60,000 destinations around the world. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

Continue Reading

Popular

© 2008-2017 Sovereign Wealth Fund Institute. All Rights Reserved. Sovereign Wealth Fund Institute ® and SWFI® are registered trademarks of the Sovereign Wealth Fund Institute. Other third-party content, logos and trademarks are owned by their perspective entities and used for informational purposes only. No affiliation or endorsement, express or implied, is provided by their use. All material subject to strictly enforced copyright laws. Registration on or use of this site constitutes acceptance of our terms of use agreement which includes our privacy policy. Sovereign Wealth Fund Institute (SWFI) is a global organization designed to study sovereign wealth funds, pensions, endowments, superannuation funds, family offices, central banks and other long-term institutional investors in the areas of investing, asset allocation, risk, governance, economics, policy, trade and other relevant issues. SWFI facilitates sovereign fund, pension, endowment, superannuation fund and central bank events around the world. SWFI is a minority-owned organization.