MFA Submits Comments to Cayman Islands Monetary Authority in Response to Consultation on Corporate Governance

The MFA published a comment letter it submitted to the Cayman Islands Monetary Authority ("CIMA") in response to CIMA's consultation paper on corporate governance. Although the MFA expressed support for CIMA's proposed principles-based approach to guidance for directors, it also urged CIMA to modify the requirements applicable to directors of funds in light of "structural differences and different investor expectations for directors of investment funds as compared to directors of other types of companies." In particular, the MFA noted that investors typically expect a fund's investment adviser, not its directors, to establish strategic objectives and risk parameters for the fund and, thus, the board of an investment fund should not be responsible for these matters.

Additionally, MFA opposed establishing numerical limits to the number of directorships a person may hold in favor of a principles-based approach focused on whether the individual has sufficient time and resources to fulfill his or her obligations with respect to all directorships which he or she holds.

Click hereto view letter in full (links externally to MFA website).See also: Letter to Industry Associations: Corporate Governance Consultation Paper; Consultation Paper: Corporate Governance; and Consultation Paper: Appendix B to the Consultation Paper.