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OECD Working Papers on Finance, Insurance and Private Pensions No. 6 - page 15 / 33





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Termination clauses are also important to avoid the capricious dismissal of members of the governing body by government.


The composition and selection of the board of the GPIF is not in line with OECD guidance or international good practice. Although the Chairman is required to have experience in economic and financial matters, it is not clear that there are any relevant criteria for the Chairman‘s Aide (Counsellor) and the two Auditors.

The selection process is not transparent, neither are the criteria and processes for removal.


independent selection process be preferable. The size and (international) talent.

(such as a selection reputation of the

board, parliamentary approval, fund should allow the GPIF

public hearings) would to attract world-class

Fit and Proper criteria


Length of appointment


Directors are chosen based on financial experience and other criteria.

Directors are appointed by the Finance Minister from a list drawn by a nomination committee.

Directors have three- year terms for a maximum of three terms (9 year maximum).

Directors may only be removed for cause.

Two of the twenty members of the supervisory board must be individuals with recognized credentials in fields considered to be relevant to the FRR‘s stated mission.

Members are appointed by parliament (2), the senate (2), various ministries (4), trade unions (5) and employer and self- employed associations (5).

Members that are not appointed by government authorities have six year terms.

Commissioners must have expertise and experience at senior level in any of the following areas: investment, economics, law, actuarial practice, civil service, trade union representation, etc. Civil servants cannot be Commissioners. A commissioner shall be disqualified from being a member of the Commission where he or she is bankrupt, is convicted of an offence involving fraud or dishonesty,

Commissioners are appointed by the Minister of Finance, except the CEO of the management entity, who is an exofficio member of the Commission.

All Commissioners other than the CEO of the management entity have five year terms, renewable for a second consecutive term.

A commissioner may be removed by the Minister of Finance if the member has become incapable through ill-health of performing his or her functions, or has committed stated misbehaviour, or his or her removal appears to the Minister to be necessary for the





Selection of the governing body of reserve funds


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