PwC: Open Books Will Rebuild Trust for Hedge Funds
|Jun 26th, 2012 | Filed under: Best Practices, Hedge Fund Industry Trends, Institutional Investing, Today's Post | By: cfaille||
Hedge funds need to earn the trust of their investors. According to a new white paper from PricewaterhouseCoopers, “From Black Box to Open Book,” there are five keys to accomplishing this:
- Alignment of interests across the value chain;
- Standardization of investor reporting and operational due diligence (though this standardization has to be balanced with customization);
- High quality infrastructure and controls;
- Independence of administrators and auditors; and
- High governance standards.
The Investor Base
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Christopher Faille is a Jamesian pragmatist. William James has taught him, for example, that "you can say of a line that it runs east, or you can say that it runs west, and the line per se accepts both descriptions without rebelling at the inconsistency."