The Hedge Fund Standards Board (HFSB) has agreed a series of changes to make its Standards more international and to strengthen them in the light of the financial crisis.
The amendments, which follow a consultation with investors and managers, pave the way for an HFSB drive to increase support among investors and hedge fund managers in the US and Asia.
Reflecting the growing international focus, Towers Watson, the global investment consultant, has recently become a Core Supporter of the HFSB. Goldman Sachs Hedge Fund Strategies, a business within the Goldman Sachs’ Alternative Investments & Manager Selection group, Grosvenor Capital Management and Cantor Fitzgerald Investment Advisors, have also joined the Investor Chapter and Candlewood Investment Group, the US hedge fund manager, has become a signatory.
Dame Amelia Fawcett, chairman of the HFSB, says: “Our new international supporters are an important vote of confidence in the HFSB’s mission.
“The changes to the Standards make them more suitable for managers outside the European market which have a different governance structure and our priority now is to build on the growing interest in Asia and the US.
“We have also toughened up the Standards in several areas, notably disclosure to investors, risk management and ensuring managers have suitable safeguards in place to prevent market abuse.”
The key change to make the Standards more international involves strengthening fund governance so that investors have a vote on significant issues if there is no independent governing body to protect their interests.
The amendments to the Standards can be seen at http://www.hfsb.org/?page=11474 . The changes come into force with effect from 1 September 2012 giving signatories six months to incorporate them.
Nearly 60 hedge fund managers accounting for USD230bn of assets under management are signatories and over 50 of the leading international investors in hedge funds support the initiative.