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The Standards Board Publishes a Toolbox Memo on Indemnification Wording in Fund Governing Documents

Today the SBAI announces the publication of its latest Toolbox Memo. This Memo, published as part of our Governance Toolbox, provides an informational overview of indemnification wording. Most alternative investment funds include indemnification wording in their governing documents. These indemnification clauses are important to investors, as they highlight the circumstances or events where the fund may be required to reimburse the asset manager for losses related to the investment management of the fund. This memo discusses the scope of wording that can be used, potential issues that can arise from broad or vaguely worded language, and questions that investors should consider as part of their due diligence process.

Alex Williamson, General Counsel at Fiera Capital Europe said: “Subtle changes in the wording used in these indemnification clauses can have significantly different outcomes in the rare event that an indemnification clause needs to be relied upon. Therefore, it is important that all parties to these documents understand these implications. This Toolbox memo is a great educational starting point.”

Craig Dewberry, Partner and Operational Due Diligence Analyst at Albourne Partners said “A robust and clearly written indemnification clause can provide comfort to an investor that this indemnity will only be relied on in appropriate circumstances. As such, investors should review this language as part of their initial due diligence processes to understand the implications of the specific way that it has been worded. This Toolbox memo is an important tool to help investors understand potential implications and due diligence questions they should be asking.”

Anabelle Perez Gray, General Counsel and CCO of HealthCor Group LLC said “Within the SBAI community, strong and appropriate governance is a key theme underpinning working group discussions and publications. This memo, along with previous publications, aids both asset managers and investors in understanding how to practically approach good governance and the necessity of robust documentation to support this.”

The SBAI Governance Working Group consists of over 65 individuals from 43 different asset manager and institutional allocator firms, including Albourne Partners, APG Asset Management, Fiera Capital, Healthcor Management LP, HPS Investment Partners, Ionic Capital Management, Ontario Teachers’ Pension Plan, Pictet Asset Management, and Winton Capital Management. Our Governance Working Group is responsible for the production of this Toolbox memo and has previously published practical guidance on topics, such as Cash Handling and Cyber Security, Conflicts of Interest in Parallel Funds, and a Standardised Board Agenda.

To find out more about the SBAI or our Governance Working Group please contact us at 

About the Standards Board for Alternative Investments (SBAI)

Established in 2008, the SBAI is an active alliance of alternative investment managers and investors dedicated to advancing responsible practices, partnership, and knowledge. At the core of the SBAI is our active community that is committed to knowledge sharing, informed dialogue, and innovation. We set clear standards and actively promote responsible practice to normalise quality and fairness. Together, our network of allocators and managers create real world solutions to tomorrow’s industry challenges. 

The SBAI and our Alternative Investment Standards are supported by more than 140 alternative investment managers with over $1 trillion in alternative assets under management and by more than 90 major institutional investors, including sovereign wealth funds, pension funds, endowments, foundations, and fund of funds, overseeing $4 trillion in assets. More information about the SBAI can be found at 
–  ENDS  –
Notes to Editors:
1.    The Trustees of the SBAI are:
  • Mario Therrien, Head of Investment Funds and External Management, Caisse de dépôt et placement du Québec (Chair)
  • Luke Ellis, CEO, Man Group plc (Deputy Chair)
  • Leda Braga, CEO, Systematica Investments
  • Jane Buchan, Founder, Martlet Asset Management
  • Clint Carlson, President & CIO, Carlson Capital
  • John Claisse, CEO, Albourne Group
  • Stuart Fiertz, Co-Founder & President, Cheyne Capital Management
  • David George, Deputy Chief Investment Officer, Public Markets, Future Fund Australia
  • Chris Gradel, Founder, PAG
  • Richard Lightburn, CEO, MKP Capital Management
  • Daniel Stern, Co-Founder and Co-CEO, Reservoir Capital Group
  • Betty Tay, Managing Director, Head of External Managers Department, GIC
  • Dale West, Senior Managing Director, Teacher Retirement System of Texas
  • Poul Winslow, Senior Managing Director, Global Head of Capital Markets and Factor Investing, CPP Investments
2.    The Founders of the SBAI are: 
  • Brummer and Partners
  • Cheyne Capital
  • CQS
  • Man Group
  • Marshall Wace
  • Sculptor Capital Management
  • Winton
3.    The Core Supporters of the SBAI are: 
  • 400 Capital Management
  • Aberdeen Asset Management
  • Acadian Asset Management
  • Albourne Partners Limited
  • Angelo Gordon & Co., L.P.
  • BlackRock
  • Blackstone Alternative Asset Management
  • BlueBay Asset Management
  • Bridgewater Associates
  • Canyon Partners, LLC
  • Capital Fund Management
  • Carlson Capital
  • Citadel
  • Fiera Capital Corporation
  • HPS Investment Partners
  • Graham Capital Management
  • Ionic Capital Management LLC
  • LFIS Capital
  • Magnetar Capital
  • Orchard Global Asset Management
  • PAG
  • Pictet Asset Management
  • Polar Asset Management Partners
  • Reservoir Capital Group
  • Securis Investment Partners LLP
  • Springs Capital
  • Two Sigma Investments
  • Whitebox Advisors LLC
4.    APAC Committee: 
  • Frances Chang, Noah Holdings (HK) Limited
  • Ted Lee, CPP Investments (Chair)
  • David George, Future Fund Australia
  • Chris Gradel, PAG
  • Richard Johnston, Albourne Partners
  • William Ma, Independent Advisor
  • Brian Pohli, Independent Advisor
  • Betty Tay, GIC
  • Danny Yong, Dymon Asia Capital
5.    EMEA Committee:
  • Elena Manola-Bonthond, CERN Pension Fund (Chair)
  • Doc Horn, Pictet Asset Management
  • Angela Borrett, Albourne Partners Limited
  • Patrick Bronger, APG Asset Management
  • Erik Eidolf, Nordkinn Asset Management
  • Stuart Fiertz, Cheyne Capital Management (UK) LLP
  • Fiona Frick, Unigestion
  • Kristina Jacobsen, Ferd AS
  • Roy Kuo, Church Commissioners for England
  • Kai Rimpi, Varma Mutual Pension Insurance Company
  • Martin Tornqvist, Capital Fund Management
6.    North American Committee:
  • Ed O’Reilly, Citadel (Chair)
  • Bradley Belt, Orchard Global Asset Management
  • Clint Carlson, Carlson Capital
  • John Claisse, Albourne Partners
  • Anoop Dhakad, HPS Investment Partners, LLC
  • Derek Drummond, State of Wisconsin Investment Board
  • Samantha Foster, University of Southern California
  • John Richardson, Ionic Capital Management
  • Priti Singh, Canada Pension Plan Investment Board
  • Sapna Vir, New Holland Capital
  • Karl Wachter, Magnetar Capital
  • Kirk Wickman, Angelo Gordon & Co., L.P.
7.    Investor Chapter Members include (please click to see the full list):
  • Alberta Investment Management Corporation
  • APG Asset Management
  • Caisse de dépôt et placement du Québec
  • CPP Investments
  • CERN Pension Fund
  • Church Commissioners for England
  • Employees Retirement System of Texas
  • Future Fund Australia
  • GIC
  • Japan Post Bank
  • J Paul Getty Trust
  • Mitsui & Co. Pension Fund
  • Ontario Teachers’ Pension Plan
  • State of Wisconsin Investment Board
  • Teacher Retirement System of Texas
  • University of Toronto Asset Management
  • University of Southern California
  • Utah Retirement Systems
  • Varma Mutual Pension Insurance Company
8.    Signatories (please click to see the full list)
In July 2014, the SBAI became an affiliate member of the International Organization of Securities Commissions (“IOSCO”). 
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Standards Board for Alternative Investments (SBAI)
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