Directors Chambers Ltd, a Malta-based professional provider of independent non-executive directors, has welcomed the Malta Financial Services Authority’s recent decision to introduce a corporate governance manual for the investment funds industry.
Directors Chambers said the manual was supportive to its internal voluntary code of conduct.
“As the economic recovery globally is taking longer than anticipated, it should make Malta more relevant as a jurisdiction due to the availability of flexible and cost-effective EU-compliant fund structures,” Directors Chambers said. “There are considerably fewer new funds being launched this year compared to the past couple of years. Malta has clearly become a household name regularly making it to the short list when fund domiciles are considered. We believe in continuous growth of Malta funds industry.”
Directors Chambers said that an overhaul of the regulatory framework is currently being implemented internationally and by the MFSA in Malta. The MFSA has clearly indicated its intention to maintain high standards of corporate governance and to improve the attractiveness of Malta as a fund domicile.
The company said the establishment of a specific corporate governance manual for the funds industry will raise the overall standards among directors of Malta-registered funds. Directors Chambers emphasised the importance of independence, continuous professional development, transparency and controls in terms of number of mandates held, active prevention of conflicts of interest, value of directors and officers indemnity insurance in addition to due diligence on all stakeholders .
By issuing guidance, as opposed to a rulebook, the MFSA has in effect left the door open for interpretation, Directors Chambers said.
“Only time will tell whether the proposed manual will be sufficient to maintain and improve the standards among directors of Malta-domiciled funds,” the company said. “Directors Chambers believes a more concrete set of rules could have eliminated potential ambiguities within areas such as prevention of conflicts of interest.”