A few words on corruption

Corruption is a common factor in Frontier markets. We are totally against such practices. Corruption increases the cost of doing business and addressing it is certainly a priority.

The question of what we, as an investor, are going to do about corruption is often raised. The answer is not simple. In the private sector, direct questions on corruption are often difficult to raise. This is especially the case when they come from a hedge fund whose prospectus permits it to short a company's stock! Such issues, therefore, are best raised in an indirect fashion. This avoid implicating the respondent of wrongdoing and facilitates dialogue and a constructive debate. In addition, reliable quantitative data on the determinants and consequences of corruption at firm level are not always easy to obtain.

Clearly, if we think and have reliable reason to conclude that a company is regularly and systematically engaged in corrupt practices we will not invest in it - Full Stop.