LONDON - Chile, the United Arab Emirates, Singapore, Ireland, Azerbaijan, Norway and New Zealand have the most transparent sovereign wealth funds, according to a fresh survey.
The Linaburg-Maduell Transparency Index for the third quarter, published by the SWF Institute earlier this week, also showed that Oman, Mauritania, Kiribati, Iran, Brunei and Algeria are home to the least transparent sovereign wealth funds. The index is calculated with 10 principles -- such as whether the fund provides up-to-date, independently audited annual reports, or whether it provides clear strategies and objectives.
Enhancing transparency is a key task for sovereign wealth funds (SWFs), whose often opaque operations have come under heavy criticism by some Western politicians who suspect them of investing with political, rather than commercial, motives.
"The global financial crisis is just the latest example of how perceived or actual opacity can damage the reputation of financial institutions," Adrian Orr, chief executive officer of New Zealand's sovereign wealth fund, told the survey.
He added that this in turn damages the perceived domestic and international legitimacy of these institutions, and ultimately their ability to operate.
"We believe that an important step toward establishing and then preserving legitimacy is for a financial institution to make it easy for its stakeholders to understand why it exists, what it does, and how. This is a reality already being faced by SWFs and we believe it will become more acute," Orr said