The web site for China’s CIC was criticized by the ‘60 Minutes’ reporter as being little more than a home page which requested information from people interested in applying for a job there. Does it matter whether an SWF has an informative web site? Does it matter, even, whether an SWF provides detailed information on its operations to anyone but its owners?

According to the institute’s own web site (which is well worth a look: www.swfinstitute.org) these funds have been typically established with the simple goal to make money. Most, unlike our Future Fund, do not have clear liabilities to be at least matched by a certain date. Even with the Future Fund, the liability by 2020 is so readily matched that the Government has been seen to set a different agenda which the Future Fund guardians have interpreted to mean chasing higher returns over rolling 10-year periods than the average super fund.

So, is there a link between transparency and returns? In pushing for greater transparency by the world’s SWFs, are we expecting them to do better or worse by the goals set out in their own constitutions? It would not surprise if we thought that greater transparency meant they were doing better for themselves. It would also not surprise if that is completely wrong. In the absence of any research on the subject, I can happily assert that I believe that there is more likely to be an inverse correlation between transparency and returns than a positive one.

As is well known by anyone who operates in the markets, it is important to keep one’s intentions to oneself. Insider trading, front-running and, even, momentum investing are great ways to make money at other people’s expense. If you look at the most successful funds of the past 20 years – the US endowment funds – you will not see uniform models of transparency. For starters, most invested very early in the less-transparent world of unlisted investments. And, while they have had to compete on an annual-return basis with rival institutions, they have had little or no incentive to advertise how they did it.

The SWF Institute principles do not, of course, call for any revelation of a fund’s investment intentions. But when you are dealing with such large sums of money, these funds are exploring new asset classes, not just individual investments, and first-mover advantage is, well, an advantage. The concerns of politicians are, sadly, not closely linked to the concerns of market participants.