Santiago Principles • Libya Africa Investment Portfolio

Santiago Principles

The Santiago Principles® are a globally recognised set of standards that guide how sovereign wealth funds (SWFs) operate, invest, and manage risk. They were developed and are voluntarily adopted by members of the International Forum of Sovereign Wealth Funds (IFSWF) and consist of 24 principles, known as the Generally Accepted Principles and Practices (GAPP).

At their core, these principles are designed to build trust. They help ensure that investment decisions are made on clear economic and financial grounds, while supporting transparency, accountability, and sound governance. In doing so, they contribute to the stability of the global financial system and encourage long-term investment.

At the Libya Africa Investment Portfolio (LAIP), the Santiago Principles are not treated as a formal requirement alone. They are part of how we operate. They shape our internal policies, guide our decision-making, and reflect our commitment to managing national assets responsibly and sustainably.

Framework Overview

The 24 principles are organised into three main areas that reflect the full investment lifecycle, from establishing a clear legal foundation to ensuring strong governance and managing risk and performance effectively.

I. Legal Framework and Investment Objectives (Principles 1–5)

This area focuses on clarity, ensuring that the organisation operates within a well-defined legal structure, with clear objectives and alignment with national economic policy.

In practice, this means that LAIP:

operates within a clear legal and regulatory framework that defines its role and responsibilities;
sets out its investment objectives within a long-term strategy;
takes into account the state’s fiscal and monetary policies when shaping its investment approach, while maintaining operational independence; and
provides relevant and timely information to stakeholders and oversight bodies to support transparency.

II. Governance and Institutional Independence (Principles 6–21)

Strong governance sits at the centre of the Santiago Principles. This area focuses on how decisions are made, how responsibilities are defined, and how accountability is maintained.

At LAIP:

roles and responsibilities are clearly defined between the Board of Directors and Executive Management;
professional and ethical standards are applied across the organisation;
financial statements are subject to independent audit in line with recognised standards;
all activities comply with applicable laws and regulations in the countries where we operate and invest; and
ownership rights are exercised in a way that supports long-term investment objectives.

Investment decisions are based on careful analysis of risk and return and are taken independently, guided by economic and financial considerations.

III. Risk Management and Performance Monitoring (Principles 22–24)

This area focuses on maintaining a disciplined approach to risk while continuously assessing performance.

At LAIP:

risk is managed through a comprehensive framework covering financial, operational, and legal exposures;
risks are regularly assessed using established tools and methodologies;
performance is reviewed against strategic objectives and relevant benchmarks; and
investment strategies are updated as global economic conditions evolve.

The Complete Reference Framework

Principle 1

Legal Framework

A clear and publicly disclosed legal framework, including its regulatory basis.

Principle 2

Objectives

A clear statement of the fund’s purpose and investment objectives.

Principle 3

Policy Coordination

Consistency with, and support for, relevant fiscal and monetary policies.

Principle 4

Funding and Withdrawal Rules

Transparent and well-defined rules governing funding and withdrawals.

Principle 5

Reporting

Regular reporting to enhance transparency and accountability.

Principle 6

Governance Framework

A sound governance framework with a clear division of roles and responsibilities.

Principle 7

Operational Independence

Operational independence in the implementation of strategies.

Principle 8

Owner’s Role

A clearly defined role for the government as owner.

Principle 9

Management Mandate

Management operating within a clearly defined mandate.

Principle 10

Accountability and Appointment

Clear processes for the appointment, oversight, and accountability of management.

Principle 11

Financial Reporting

Financial statements prepared in accordance with recognised standards and subject to independent audit.

Principle 12

Oversight

Effective internal and external oversight mechanisms.

Principle 13

Professional and Ethical Standards

Adherence to high professional and ethical standards.

Principle 14

Dealings with Third Parties

Compliance with applicable laws and regulations in recipient countries.

Principle 15

Asset Protection

A legal framework that safeguards the fund’s assets and rights.

Principle 16

Administrative Independence

Administrative and financial independence in operations.

Principle 17

Disclosure

Timely disclosure of material and relevant information.

Principle 18

Investment Policy

A clear and consistent investment policy framework.

Principle 19

Investment Decisions

Investment decisions based on risk and return considerations.

Principle 20

Market Integrity

Respect for market integrity and fair competition.

Principle 21

Ownership Rights

Exercise of ownership rights in line with investment policies.

Principle 22

Risk Management

A robust and comprehensive risk management framework.

Principle 23

Performance Measurement

Measurement and disclosure of investment performance.

Principle 24

Review and Compliance

Regular review of implementation and compliance with the Principles.

Why It Matters

For LAIP, adherence to the Santiago Principles is about more than alignment. It is about building trust and delivering long-term value.

It helps us to:

protect and grow national assets responsibly;
maintain confidence among stakeholders and partners;
manage risk in a consistent and disciplined way; and
ensure that our investments support long-term strategic priorities.

By embedding these principles into how we work, LAIP continues to strengthen its role as a long-term investor contributing to sustainable economic development.