Carlyle: independent NED expertise unnecessary

Carlyle: independent NED expertise unnecessary

Is it okay for a fund board, with a complex strategy, to rely upon its executive directors for its expertise?  The judgement of a Guernsey Court, following the Carlyle Capital Corp collapse with loses of over $1 bn, says that it is.

The fallout from the recent Carlyle case in the Guernsey courts has opened up a fascinating debate about the need for independent expertise on fund boards.

In particular it gives rise to the question of whether non-executive directors should have to have some expertise – or indeed any real understanding of the fund’s investment strategy at all - in order to be on the board.  Put the other way around, is it acceptable for a board of a fund, with a complex strategy, to rely exclusively upon its executive directors for its knowledge of the investment policy?

To read more on this story see the December issue of The NED.

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