GLOBAL – Managers dealing in unregistered hedge funds are being invited to adopt a draft code of conduct presented by the CFA Centre for Financial Market Integrity.

The centre, launched by the CFA Institute, will focus on research and policy worldwide and has already drafted a consultation paper for a code of conduct aimed at the asset management community in general.

The code, however, states that unregistered hedge funds managers “in particular” are encouraged to adopt and implement its provisions - “to endure fair dealing and integrity and to promote self regulation in this dynamic sector”.

A final version is going to be drafted by the end of the year, after feedback from the public, said Kurt Schacht, the centre’s first executive director.

Presenting the code in London today, Schacht said the centre would value feedback from the asset management community.

“This is the beginning of a process, a consultation paper,” he said, adding: “It is good for firms without a code and good for firms with a code and seek to update it.”

“Clients come first,” he went on: “Clients need to know fully and fairly about conflicts of interest, risks and fees.”

Commenting on the mission and contents of the code, Schacht mentioned investment policies and strategies, trading, compliance and performance evaluation.

Alan Brown, chief investment officer at State Street Global Advisors, and one of the seven-member advisory council chaired by John Neff, also stressed the importance of integrity for the good of the industry as a whole.

“Our job is to promote and increase voluntary engagement, espouse principles not rules and put the client’s interest first.”

“We all benefit if the industry is seen as having integrity,” Brown said.

As well as Brown, the advisory council has two more European members. These are Jelle Mensonides, of ABP Investments, the asset management arm of the 156 billion-euro pension fund ABP and John Stannard, managing director of client communications and support for the Russell Investment Group in Europe.

The CFA Centre will have staff in New York, London, Hong Kong and Charlottesville, in the US.