Sovereign Wealth Funds: Aspects of Governance Structures and Investment Management
35 Pages Posted: 10 Dec 2013
Date Written: November 2013
Abstract
This paper presents in a systematic (normative) manner the salient features of a SWF‘s governance structure, in relation to its objectives and investment management that can ensure its efficient operation and enhance its financial performance. In this context, it distinguishes among the various governing bodies and analyzes key aspects of the investment policy and setting of the risk tolerance level in order to ensure consistent risk-bearing capacity and greater accountability. Further, it discusses the important role of SWFs in macroeconomic management and the need for close coordination with other macroeconomic and financial policies as well as their role in global financial stability.
Keywords: Sovereign wealth funds, Asset management, Investment policy, Corporate governance, Transparency, Risk management, governance structure, investment management, macroeconomic coordination, investment strategy, investment strategies, legal framework, credit risk, investment decisions, investment risks, pension funds, risk management process, fiduciary responsibility, market risk, risk aversion, investment fund, risk measure, investment functions, contingent liabilities, accounting standards, investment environment, risk of fraud, commercial banks, investment climate, risk management policies, risk taking, supervisory system
JEL Classification: G11, G15, G23, G32, G34
Suggested Citation: Suggested Citation