Sovereign wealth funds are teetering on the public relations precipice. There are calls from a fearful minority to regulate these entities that together represent the financial muscle of most of the world’s population.
Top bankers in Europe admit that tying them down to stiff codes of practice “seems difficult and probably unnecessary”, but they still want it done in order to ensure they provide the public with necessary information apparently.
This is of course the worst kind of hypocrisy. The financial institutions in Europe and America – already weighed down by intense regulation and scrutiny – that have been failing to provide the public with the necessary information.
Soc Gen, UBS, Citigroup, Merrill Lynch, Deutsche Bank, Bear Stearns and even the mighty Goldman Sachs are all guilty of late as the US sub-prime crisis delivers one body blow after another to these “masters of the universe”. And while it is the sovereign wealth funds that bail out these incompetent banks with much needed cash, the response is to kick them in the teeth. It is cheering news then that Virgin Group and Dubai International Capital have been in talks about some kind of investment joint venture.
Virgin’s boss Richard Branson has propelled his brands to global recognition and success, fighting off established giants in every sector. DIC has proved itself a shrewd investor bringing a very respectable track record of acquistions with it. The combination could elevate DIC above the cloud of suspicion that is being spread over sovereign wealth funds at the moment.
Virgin PR genius to DIC's rescue?