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By Beverly Chandler, Opalesque London:

AIMA Australia has published Principles for Australian institutions that are investing in hedge funds, drafted from the advice and experience of the members of the Investor Advisory Committee, including chairman, Bruce Tomlinson from Sunsuper; Dr. Jon Glass from Media Super; Craig Turnbull from Local Government (NSW) Super and Tom Gillespie from ARIA.

The Principles are designed to provide guidance to hedge fund managers regarding their dealings with Australian institutional investors, offering a general indication of investors’ preferences. The aim is that the more closely a manager adheres to the Principles, the better the managers’ ability to progress through due diligence. However, the report makes it clear that these are Principles, not enforceable standards.

The focus is on generic operational and business areas, leaving the investment management concerns to each investor, as preferences and strategies can vary widely. The Principles also make it clear that investment process and governance practices vary across superannuation funds, so that trustees or directors may or may not be involved in manager appointment decisions.

The committee also warned that hedge fund managers should be aware of the role of the two Australian regulators, ASIC and APRA, and should be up to date with any changes in regulations as they occur. It also encouraged awareness of more universal industry standards and guidelines such as Hedge Fun......................

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