Sovereign Wealth Funds' (SWFs') social media strategies

Abstract

It is estimated that there are currently 100 major Sovereign Wealth Funds (SWFs) in operation worldwide, which command an asset total of some US$10.31tr (SWFI, 2023). SWFs are thus the largest class of nontraditional (alternative) pooled investment vehicles by assets under management (outstripping by far more conspicuous hedge-, private equity- or exchange traded funds (TheCityUK, 2021). Although SWFs tend to pursue a variety of objectives or their combinations: efficient management of foreign exchange (f/x) reserves, socioeconomic development, pension reform, macroeconomic stabilization and direct investments, their overriding goal is an intergenerational transfer of wealth – in conformity with the tenets of sustainable development (Brundtland, 1987). Despite fiduciary mandates to manage the savings of entire countries, states or provinces, SWFs tend to be highly opaque - their information disclosures performed via traditional media are scrimpy, infrequent and irregular. Most SWFs, although theoretically accountable to their societies, including the future generations of their beneficiaries, tend to shy away from social media engagement, i.e. the very media that such beneficiaries will increasingly use. The primary hypothesis set and examined in this research is thus a pervading and chronic lack of proactive social media policies by most SWFs. Although 78 SWFs maintain proprietary websites and some even use selected social media platforms to promulgate user-oriented content, they fail to engage societies (their primary stakeholders) in any form of interactive dialogue or accountability. SWFs’ use of social media is thus primarily geared to disseminating self-selected scraps of information without any pretense to comprehensiveness, regularity and interactivity. The paper empirically examines the social media strategies of most active SWFs and their role in enhancing the social accountability of their operations. The research also raises the need for more public awareness of SWFs’ objectives and activity.