Forbes- It’s rather ironic that on a day that global markets suffered one of their worst routs since September 11, a group of top British hedge fund managers outlined their plans to improve the way they value their assets, and boost investor confidence in the industry.
Sir Andrew Large, who headed the industry-led working group in its six month inquiry, announced plans to set up the Hedge Fund Standards Board, funded by levies from within the industry, to promote and update best practice within the sector.
The standards, which will be voluntary, include better disclosure when it comes to the governance of hedge funds, and more independent valuation of assets. The potential conflict of interest between hedge fund managers, who rely on assets doing well, and investors, who want assets valued fairly has become a source of contention with the British market regulator, the Financial Services Authority. The working group is recommending that the valuation should be done either by an independent third party, or if that were not possible, by a separate person in-house.
