On October 14, 2008, I wrote a piece “Making the World Safe for Sovereign Wealth Funds” on the release of the “Santiago Principles” (Generally Accepted Principles and Practices [GAPP]) by International Working Group (IWG) of Sovereign Wealth Funds (SWFs) on October 11.

At the end of my piece, I expressed concern that the members of the OECD—the organization of the world’s leading democracies and market economies and, as such, the group representing the views of the recipients of many SWF investments—had not adopted sufficient reciprocal measures to support the openness of international investment. OECD officials subsequently sent me information about OECD guidance on SWF investments. Most of that information was previously available. However, the actions with respect to accountability for decisions and the decision-making process were agreed only on October 8 and had not been highlighted. The OECD communication is reproduced below, followed by my additional observations.

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Although the weekend gathering of finance ministers and central bankers in Washington was, until Monday, filled with doom and gloom, one event was very encouraging. The International Working Group (IWG) of sovereign wealth funds (SWFs) unveiled their voluntary Generally Accepted Principles and Practices (GAPP)—the Santiago Principles. The GAPP is a solid piece of work that should help to dispel some of the mystery and suspicion surrounding SWFs. The International Monetary Fund deserves substantial praise for facilitating an agreement in the IWG in a remarkably short period of time.

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