Santiago Principles Self-Assessment

Fonds Souverain d'Investissements Stratégiques S.A.

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  • Pillar 1: Legal
  • Pillar 2: Institutional
  • Pillar 3: Investment
Principle 1

1. The legal framework for the SWF should be sound and support its effective operation and the achievement of its stated objective(s).

1.1. The legal framework for the SWF should ensure legal soundness of the SWF and its transactions.

1.2. The key features of the SWF’s legal basis and structure, as well as the legal relationship between the SWF and other state bodies, should be publicly disclosed.

There is no specific legal framework for sovereign wealth funds in Senegal. 

FONSIS’ creation was allowed under legislation n° 2012-34 voted in Parliament on 27 December 2012 (the “Founding Law”). The Founding Law is publicly disclosed in the Government Official Journal and available online at this link 

This Founding Law was used as the basis to incorporate FONSIS and to draft the Articles of Associations of the Fund as a legal entity under private law. 

As such, FONSIS is a limited liability corporation (“Société Anonyme” or “S.A.”) fully compliant with private business law of OHADA, the Organisation for the Harmonization of Business Laws in Africa, as is the case for any other private company in Senegal, the latter being a member-state of OHADA  

FONSIS is therefore incorporated under private OHADA business law, and the State of Senegal is the sole shareholder at the moment. The Founding Law and the Articles of Association do however provide for other state-owned entities or governmental agencies to become shareholders, if needed. The Articles of Associations are readily available to the general public, at the Registry of the Commercial Court of Dakar, as is the case for any other company created under local private law.

As a limited liability corporation and under private OHADA business law (more specifically the Uniform Act on Commercial Companies and the Economic Interest Group (“Uniform Act”), FONSIS has a Board of Directors (“BoD”), a Chairman and Chief Executive Officer (“CEO”). The BoD, the Chairman and CEO are nominated by the Head of the Government of Senegal (the President), by presidential decree. Once nominated, they are part of the governing bodies of the Fund. The BoD, the Chairman and the CEO execute their missions and duties in accordance to The 2012-34 Founding Legislation of FONSIS and to the Uniform Act, which is available to the public in this link

Principle 6

6. The governance framework for the SWF should be sound and establish a clear and effective division of roles and responsibilities in order to facilitate accountability and operational independence in the management of the SWF to pursue its objectives.

The Fund’s governance structure establishes distinct roles and responsibilities in its management. 

As a private company; the functions of the CEO, the Board of Directors and the committees of the Board (investment committee, audit and risk committee, ESG committee and the recruitment and remuneration committee) are clearly separated. 

The CEO manages the day-to-day operations of the fund. In the performance of his duties, he is given the widest powers which he exercises within the limits of the object of the fund. 

The Board of Directors, ensures among others the following tasks:

  • deliberates on measures relating to the management of FONSIS and  determines the investment and management  policies of FONSIS;
  • exercises permanent control of the CEO’s management;
  • approves all investment projects, based on financial and economic considerations and the Board members’ expertise in various sectors;
  • approves the annual accounts.

The Investment Committee decides whether the closing conditions are satisfied and that disbursements are made according to the Board’s resolution.

The Audit and Risk Committee ensures compliance with policies and procedures and assesses the quality of internal controls. 

The Recruitment and Remuneration Committee approves the appointment of personnel and defines the remuneration and the representation of FONSIS in the boards of its subsidiaries and affiliates. 

The ESG Committee monitors the implementation of the ESG policy and ensures that the ESG criteria are duly taken into account in the fund’s investments. 

The decision-making and operational functions are allocated to the operational team as described in its articles 9 through 19  

Principle 18

18. The SWF’s investment policy should be clear and consistent with its defined objectives, risk tolerance, and investment strategy, as set by the owner or the governing body(ies), and be based on sound portfolio management principles.

18.1. The investment policy should guide the SWF’s financial risk exposures and the possible use of leverage.

18.2. The investment policy should address the extent to which internal and/or external investment managers are used, the range of their activities and authority, and the process by which they are selected and their performance monitored.

18.3. A description of the investment policy of the SWF should be publicly disclosed.

FONSIS Investment policy is defined in Article 6 of the Founding Legislation 2012-34 and is consistent with the Fund’s objectives and risk tolerance.

By clearly defining the risk tolerance, this investment policy guides the use of leverage in order to strengthen the Fund’s financial resources. 

Apart from the Founding Legislation cited above, the investment policy is publicly disclosed on the FONSIS website as well and is reviewed on an annual basis.

External co-managers can be used to manage funds or assets. As such, the process by which external managers are selected, how their performance is monitored and the scope of their interventions are defined as part of the Fund Management processes of FONSIS and publicly disclosed through open calls for expression of interests or procurement notices.