How to Run Offshore Management Companies and Funds with Substance and Corporate Governance
Laven Financial Services, the Laven group’s offshore consultancy servicing fund managers and their funds in Caribbean jurisdictions, is launching a white paper series on How to Run Offshore Management Companies and Funds with Substance and Corporate Governance.
The series aims to provide best practice guidance to fund managers with offshore business structures.
The Cayman Islands and the British Virgin Islands, according to Q2 2012 statistics published by their regulators, have in total over 13,000 mutual funds between the two jurisdictions and over 2,500 management companies. Despite the excitement over regulated funds such as UCITS over the recent years, these offshore Caribbean jurisdictions still remain the primary centres for establishing fund businesses. With recent global regulatory developments, increased investor awareness and growing institutionalisation taking place within the industry, any businesses based offshore should ensure they meet the standards expected of any properly conducted business, regardless of its domiciliation. Offshore funds now have to compete with their onshore peers whose governance and operational processes are subject to legislation and guided through stringent regulation.
The white paper series should also be useful guidance for any investors on how they may view corporate governance of offshore fund structures when carrying out any operational due diligence or manager selection.
The series will draw on the Laven group’s experience in corporate governance and fund formation but also its expertise through compliance and tax specialists and operational due diligence consultants.
Jerome Lussan, CEO of the Laven group comments: “The idea to introduce a series of white papers on offshore corporate governance comes from our strong belief that proper operations, including corporate governance and regulatory compliance, can help fund managers better manage their businesses and as a result raise more assets. In a time when asset raising is already hard, fund managers should increasingly focus on how to make the operational aspects of their businesses more attractive to investors.”
Lussan continues: “It is no longer just about performance and track record. The investors our due diligence team work for are just as interested in operational processes. After cases such as Weavering or Madoff, it is no wonder operational risk is high on the list of investors’ worries. We want to give the industry our views on how to attain business success through implementing appropriate, yet manageable, corporate governance processes.”
The series will culminate in a corporate governance best practice booklet to be published by Laven.
The white papers will cover topics such as:
– The idea of the offshore management company and how it should be managed from an operational and tax point of view
– How the patterns of controls exercised or not through governance can enhance tax risks
– The board of directors of the fund – its constitution, expertise and (non-)executive responsibilities
– Review of best practice guidelines and the need for established rules on corporate governance
– How proper offshore operations can help raise assets
The series will also include relevant case studies. The white papers will be distributed via the Laven group’s newsletter as well as being made available online.
The white paper series on How to Run Offshore Management Companies and Funds with Substance and Corporate Governancewill be produced by Laven Financial Services, a consultancy providing substance and control services in the Caribbean across traditional hedge fund structures, such as management companies in the Cayman Islands and the British Virgin Islands. Laven Financial Services offers corporate governance, international compliance and operational support services, as well as directorships to offshore management companies.
For more information, please visit www.lavenfs.com
