UK private equity has one year to open up: BVCA

LONDON (Reuters) - Buyout firms operating in the UK have as little as a year to increase transparency or face new legislation, the head of the country's industry trade body said at the Reuters Hedge Funds and Private Equity Summit in London.

"Private equity has got to provide more information about itself and engage more with the outside world," said Simon Walker, head of the British Private Equity and Venture Capital Association, on Monday.

"I think we have about a year to get this right before it is done for us."

Companies owned by private equity firms such as TPG or 3i (III.L: Quote, Profile, Research, Stock Buzz) should provide a business review similar to that disclosed by listed companies, according to a report commissioned by the private equity industry and published in November.

That study was commissioned by the BVCA in March 2007 and assigned to veteran banker David Walker, former chairman of Morgan Stanley International (MS.N: Quote, Profile, Research, Stock Buzz).

Simon Walker said the BVCA would encourage other "long-term" asset owners, including so-called sovereign wealth funds (SWFs) and some pension groups, to join its ranks and adhere to the transparency principles.

SWFs, such as Dubai International Capital and Temasek, are state-backed investment funds that have been bidding for assets ranging from ports to supermarkets in recent years.

Some of the most active of these funds are based in the Middle East and the Far East.

Walker added he is opposed to a bill California lawmakers are trying to pass, barring California-based pension funds from investing with private equity firms owned by SWFs linked to countries with poor human rights records.

"The California bill is particularly dangerous," said Walker.

"Singapore and the United Arab Emirates are countries being targeted. If you're looking for breaches of human rights, I'm not sure you would pick those two. It's a politically driven move."

(Reporting by Mathieu Robbins; editing by David Hulmes)