"The Alaska Permanent Fund is widely considered one of the best examples of how a sovereign wealth fund should operate," said CEO Michael J. Burns. "While we are a state-level fund, we are considered by the international community to represent the U.S., and I think that they are very pleased at the Federal level to have us be regarded so highly."
As sovereign wealth funds have grown in size and new funds have been created over the last few years, concerns have been raised regarding the transparency and investment practices of these funds. In response to these concerns, the International Monetary Fund has begun the process of establishing voluntary best practices for sovereign wealth funds. The U.S. Treasury Department has been strongly supportive of this effort.
On March 20, the sovereign wealth funds of Singapore and Abu Dhabi announced in a joint statement with U.S. Treasury that they would adopt practices of greater disclosure and strictly commercially-based investing following meetings with Treasury Secretary Paulson.
In a study of best practices released this month, the Permanent Fund received the highest ranking for non-pension funds by the Peterson Institute. The paper ranked 33 sovereign wealth funds on structure, governance, accountability and transparency, and behavior. An additional 10 pension funds were ranked as well.