Corporate governance: Hedge funds need independent directors

“It is not reasonable that any director can truly independently understand and monitor the full range of risks and complexities in today’s highly sophisticated hedge fund” Don Seymour, DMS Management

Hedge fund failures as a result of sub-prime bets or credit crunch-related losses have increased the need for independent directors at hedge funds. “Historically, corporate governance was viewed as inconsequential in the hedge fund industry, but the recent hedge fund failures have demonstrated the enormous value of an effective independent board capable of protecting and maximizing the interests of investors,” says Don Seymour, managing director at DMS Management, a service provider and adviser to hedge funds.