SEBI has asked AIFs to constitute an investment committee to approve investment decisions of fund managers.
The committee will be responsible for making investment processes & decisions and defining role of fund managers.
George Heber Joseph, CEO and CIO, ITI MF believes that the move will strengthen the investment processes of AIFs. “Investment committee will have to give its approval before AIF managers execute transactions. This will ensure that AIFs are held responsible for their investment decisions,” said George.
Shahzad Madon, Head - PMS and Alternative Assets, Nippon Life India AMC feels that constitution of investment committee at AIF level will increase transparency particularly in terms of fund management philosophy and style.
Nalin Moniz, CIO-Alternative Equity, Edelweiss MF said that the industry awaits details of investment committee like running and constitution of the investment committee.
Another clarification is relaxation in terms of experience of fund managers to manage AIFs. SEBI has clarified that AIFs can consider collective experience of the entire investment team to meet the eligibility criteria to manage AIFs.
So far, investment team of AIFs had to have adequate experience, with at least one key personnel having at least five years of experience in advising or managing pools of capital/ assets/ wealth/ PMS or in the business of buying, selling and dealing of securities or other financial assets.
“The qualification and experience criteria of the investment team may be fulfilled individually or collectively by personnel of key investment team of the manager,” said SEBI.