EMPEA Code of Conduct

Introduction

The Emerging Markets Private Equity Association (“EMPEA”) was formed in 2004 to support the development of the emerging markets private equity industry. EMPEA’s members comprise private equity fund managers, investors, service providers and other entities with an interest in promoting the asset class.

Code of Conduct

The following Code of Conduct establishes a minimum set of principles, compliance with which is mandatory for all EMPEA Members and their directors, managers, employees, representatives and nominees. EMPEA’s Board of Directors adopted this Code of Conduct on May 18, 2005.

Integrity

Members shall promote and maintain ethical standards of conduct and at all times deal fairly and honestly with each other and with companies seeking private equity.
Members shall conduct their business in a professional way and shall not engage in practices that may be damaging to the image or interests of EMPEA or to the emerging markets private equity industry.
Members shall not malign, defame or unfairly criticize any other Member.
Members shall neither take improper advantage of their position in EMPEA nor abuse any confidential information addressed to EMPEA.
Members shall abide by the EMPEA Code of Conduct and any other standards issued by the Board or a Committee of the Board.

Regulatory

Members shall take adequate steps to ensure that they comply with all relevant regulatory requirements including, but not limited to, the establishment and documentation of proper procedures, maintenance and retention of full and complete business records, and disclosure of any conflicts of interest.
Members shall deal with regulators in an open and co-operative manner and keep them informed of relevant matters concerning their activities.

Investor Relationships

Investment Managers shall be accountable to their investors and keep their investors fully and regularly informed, including, but not limited to, the provision of regular operating and financial reports.
Investment Managers shall not accept into their funds subscribed capital from unspecified sources.
Investment Managers who sponsor investment syndications with other parties, whether members of EMPEA or not, shall operate on the basis of full disclosure to such other parties.
Investment Managers shall not use a private equity fund to promote their own interests or the interests of their directors, managers, employees, representatives and nominees, except insofar as they benefit from the success of such fund according to established compensation and profit-sharing contracts.

Portfolio Company Relationships

Investment Managers acknowledge that their primary business concern is developing the strength of the portfolio companies in which they have invested, which will result in the funds under management making long-term capital gains.
Investment Managers shall declare to any portfolio company in which they have invested any conflicts of interest that may arise.
Investment Managers shall respect confidential information supplied to them by companies seeking private equity or by portfolio companies in which they have invested.

Performance Measurement and Reporting

Investment Managers shall adopt standards for measuring and reporting investment performance that conform with widely accepted industry guidelines.