Sovereign Wealth Fund Development in Indonesia: Lessons Learned from Norway and Singapore

This study aimed to compare Sovereign Wealth Funds in Singapore, Norway, and Indonesia based on several categories: classification and objectives, nature, source of funds, management, implementation, funding policy, and regulatory framework. This study adopts the grounded theory approach for analysing and categorising the data. Earlier studies on SWF have been focused on the governance and operation of the SWF globally, with minimal attention paid to SWF in developing economies. The study shows that the Indonesia Investment Authority (INA), as a newly established SWF, encountered several issues related to applying good corporate governance. Therefore, comparing the more established SWF in Singapore and Norway is significant in gaining valuable insight into INA’s future. This circumstance is aimed at preserving the government’s trust by adding positive value to INA’s business management and ensuring sustainability. The result assures potential investors that INA’s legal basis is valid and enforceable. Furthermore, an expanded INA governance framework is proposed as a practical contribution based on the results of other SWFs in Norway and Singapore. This framework is adjusted to suit INA’s context and main objectives, including funding policy, supervisory institution, and transparency and accountability of the investment activities.