“Thai CG Fund” to launch this year

“There are 11 asset management firms in the initiative, representing 90 per cent of total assets under management (AUM)” said Voravan Tarapoom, chairman of the Federation of Thai Capital Market Organization (FETCO) and chairman of the Association of Investment Management Companies (AIMC).
The Thai CG Fund is an equity fund that will invest in companies listed on the Stock Exchange of Thailand (SET) and Market for Alternative Investment (mai).
Investment targets must conform to three criteria: they must have good corporate governance, at least a four-star rating from Thai IOD (CGR) and they must also be members of the Collective Action Coalition of the Private Sector Against Corruption (CAC), led by the Thai Institute of Directors Association (IOD). 
The fund will have a committee — one member will represent one asset management firm — to jointly set the criteria for CG-focused securities, which all asset management firms will use. 
“Initially, the stock portfolio of the CG Fund will consist of 103 companies screened from Thai IOD and CAC companies which have been individually selected,” said Voravan, adding that each of 11 asset management companies could select any securities in the portfolio accordingly to their investment policies and strategies. The portfolio list would be reviewed annually, he said. 
In addition, 40 percent of asset management fees received by the Thai CG Fund will be set aside to support organisations that promote good corporate governance and combat corruption.
“This CG-focused fund will encourage listed companies to develop good corporate governance practices, while the asset management firms will be the key players in driving sustainable returns on investments in the long run,” said Voravan.