The new ILA Fund Governance Masterclass programme meets the demand for specific training and certification in this field. Such is the interest, the inaugural series of ten modules is already on the point of being fully booked, explained Henry Kelly and Yann Power, the members of the ILA Fund Committee who lead the creation of this programme.
“The simple aim is to work to ensure that fund directors’ expertise is as high as it can be, which is important given Luxembourg’s key role in the global fund industry” said Henry. The programme starts with a general introduction to fund governance (including a dinner with CSSF director Marco Zwick), then with detailed modules looking at AIF governance, investment management oversight for UCITS & alternatives, fund administration and valuation, the role of the depositary, the role of the auditor, marketing, distribution and transfer agency, AML, ESG, strategy & technology challenges, and key regulatory considerations. A closing dinner with a keynote speaker will wrap things up.
These ten modules will be delivered over two separate 40 hour weeks, with one held in October this year and the other in January/February 2023. Participants need to be either ILA Certified Directors or have at least three years experience in the funds industry as a board member (executive or non-executive), a conducting officer or in executive management. Alternatively, participants can select those modules most relevant to themselves. Only ILA Certified Directors will be able to achieve full Fund Governance Expert certification on completion of the full course. Around 30 experienced local fund professionals will deliver these sessions.
Yann gave an example of the topics that will be discussed. As regards relationships within the alternative fund sector, there are no regulations setting out how these should work and what information should be exchanged. Good governance is enhanced when there is clarity and understanding on such matters. “For example, it is an open question whether the board of the fund should have access to the compliance function of the investment fund manager,” he said. “In many cases the fund manager might wish for this to be the case, but it's not necessarily a straightforward decision. The whole dynamic of that relationship is something for the two boards to sort out, maybe in discussion with the key functions of the investment manager.”
Another example of a challenge examined in the course is how boards should react in the event of a cyber-attack resulting in the leak of sensitive information. This will require relationships to be managed with investors, the regulator, the police, the press and others, so directors need to prepare for these eventualities.
“Directors bear a huge responsibility towards investors, and this programme is there to better enable directors to face up to that challenge,” said Yann, pointing out that there is no specific regulatory requirement to follow such a course. That said, the CSSF are aware of the course and are supportive of the initiative. Interest in this course has already been strong, with most of the 25 places already reserved. A second cycle is planned provisionally for the end of next year with a view to making this an annual event.
“One of the key elements of the programme is the interactive nature of these modules,” said Henry. “There will be a wide spectrum of people who will attend, and we will all learn from each other’s experience. Even the most seasoned fund directors will take away something from these sessions.”