Guidelines for asset management for the Music Rights Awareness Foundation

The purpose of the Foundation

The purpose of the Foundation is to create awareness and increase knowledge around the world about music rights, and related issues. The Foundation shall carry out its purpose by educating, collaborating with and inspiring music creators and others within and around the music industry, about music rights and related issues.
The Foundation shall also support global and local initiatives which enable more individuals and music collaborations around the world to make a living on their music creations. The Board of Directors shall determine in what proportions the Foundation’s specific objectives will be met.
The Foundation may engage in business activities either directly or through subsidiaries, in order to promote the purpose of the Foundation or to support the Foundation activities in other ways. The Foundation may also promote its above stated objectives through financial support of another organization.

Purpose of guidelines and return targets

These investment guidelines establish the rules, objectives and organization applicable to management of the foundation’s assets.
The investment guidelines establish rules and guidelines for the investment operations regarding:

1. Return targets

2. Organization and allocation of responsibilities

3. Permitted investments

4. Investment strategy

1. Return targets

A long-term approach is important in the management of the foundation assets since the value of the capital must be secured for the future. In the shorter term, the asset management should achieve a healthy return which is allocated in accordance with the rules regarding the foundation’s objectives.
The return target is to maintain in the long term the real value of the foundation portfolio and to achieve five per cent average annual return over a business cycle.

2. Organization and allocation of responsibilities

The Board is responsible for asset management for the foundation, lays down investment guidelines, and makes a decision on the choice of Asset Manager.
The Board must at least annually decide investment guidelines and revise them when necessary.
The Board also assures that investment guidelines and reporting requirements are complied with.
The Board may also appoint one of more of its members to decide and authorize transactions.

Internal control and reporting

The Board, the person(s) appointed by it, must at least monthly receive portfolio reports sent from the Asset Manager.

Custody of securities

All securities must be held in custody by securities companies authorized by the Swedish Financial Supervisory Authority.

3. Permitted investments

Standards and values

The foundation takes into consideration social responsibility and high ethical standards when making investment decisions. This means that investments which are obviously in conflict with these factors must be avoided.
Investments must not be made in companies which have been found to violate international standards regarding human rights, environmental considerations, corruption and labor law.

The starting point should be the optional UN initiative Global Compact’s 10 principles. The Asset Manager appointed by the Board to manage the funds of the foundation must have signed the UN’s Principles for Responsible Investment (UN PRI).

Permitted asset classes

The assets must only be invested in the asset classes and with the counterparts stated in these investment guidelines. Securities investments not stated in these investment guidelines require specific decisions by the Board. Investments may be done directly, via discretionary management or via mutual funds in the asset classes stated below.

a) Interest-bearing securities and liquid funds. Nominal and real interest-bearing securities and fixed income funds and bank accounts.

b) Shares and equity-related instruments. Shares in limited liability companies which are subject to regular trading in a regulated market. Equity-related instruments mean primarily mutual funds or a composition of funds pursuant to the same definition.

Approved counterparts

Securities transactions may be done with securities companies authorized by the Swedish Financial Supervisory Authority, or a similar supervisory authority, to trade in financial instruments on account of another party in their own name, or with foreign institutions with equivalent authorization. Investments may be made in fund management companies authorized by the Swedish Financial Supervisory Authority, or an equivalent supervisory authority.
Discretionary management or other external management may be procured by counterparts authorized by the Swedish Financial Supervisory Authority, or by foreign institutions with the equivalent authorization as above.

4. Investment strategy

Normal portfolio

The investment strategy must be expressed in the form of a normal portfolio stating the allocation between asset classes. The normal portfolio should be selected based on an assessment of expected return and risk. The expected return must meet the return target and expected risk must not exceed a risk level acceptable for the foundation.

Risk mandate

A risk mandate is given in the form of permitted deviations from the normal portfolio.

Asset composition

Portfolio allocation:

Asset class

Portfolio total (%)




Equity-related financial instruments




Interest-bearing financial instruments




Cash funds





Other guidelines for asset management

Securities lending

Lending of securities in the portfolio is not permitted.


Trading in options is not permitted.

Investment funds

Investment funds regarding the asset classes above may be utilized in asset management. These funds must be subject to the supervision of the Swedish Financial Supervisory Authority or a corresponding financial supervisory authority outside Sweden. Since funds themselves are well diversified, the funds’ individual holdings are not analyzed. These investment regulations do not apply in such cases; instead, the fund regulations apply. Lending of securities is possible in funds.