On Feb. 27, the day the European Commission said that sovereign wealth funds should adopt a voluntary code of conduct, the U.S. Congress announced the creation of a bipartisan task force to examine transparency and accountability issues, among others, surrounding the rapidly growing, government-owned investment vehicles.
Recent estimates put sovereign wealth funds' assets at $2.2 trillion, greater than that of hedge funds and expected to grow at a much faster rate--by 2015, they could reach $15 trillion, according to the U.S. Treasury Department. Sovereign wealth funds are, in principle, long-term, stable investors that provide significant capital to the system. Recently they have helped rescue U.S. and European firms hard hit by subprime-related write-downs, purchasing minority stakes in Citigroup, Merrill Lynch & Co. and UBS.
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