A committee of the Stanford Institutional Investors’ Forum at Stanford Law School, in cooperation with the Arthur and Toni Rembe Rock Center for Corporate Governance, announced new standards designed to improve fund governance and curb abuse of fund assets.
The Clapman Report, a set of best practice principles for managing pension, endowment, and charitable funds, calls for institutional investors to adopt basic policies aimed at improving how they govern themselves.
“As a committee we were bound by a central belief: fundamental fund governance standards ought to exist to safeguard beneficiaries’ assets from questionable—and often illegal—practices, and to protect the taxpayers who end up footing the bill when institutional investors fail,” says Peter Clapman, CEO of Governance for Owners USA.
Among the report’s recommendations are that funds should: clearly define and make publicly available their governance rules; mandate tough and transparent policies to address conflicts of interest; take steps to ensure funds have trustees who are competent in financial and accounting matters; establish clear reporting authority between trustees and staff; and define appropriate responsibilities and delegation of duties among fund trustees, staff, and outside consultants.
To read the report on Stanford’s website, click here.
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