IOSCO/MR/20/2025 – Madrid, 17 November 2025
The International Organization of Securities Commissions (IOSCO) today published the Consultation Report (“Report”) on Valuing Collective Investment Schemes (CIS).
This report invites comments and feedback from IOSCO members and market participants on a combined set of recommendations. The proposed recommendations will update IOSCO’s 2007 Principles for the Valuation of Hedge Fund Portfolios and its 2013 Principles for the Valuation of Collective Investment Schemes (collectively, the “Principles”).
Robust valuation practice is a critical component of asset management, ensuring that assets are properly valued and investors are not disadvantaged. Asset valuations determine the net asset value (NAV) of a fund, and the NAV is then used to calculate the price at which investors transact in units of a fund. Proper valuation also serves as important information for investors when making asset allocation decisions and selecting funds as well as financial reporting, performance reporting, and calculating fees paid to CIS service providers. If asset valuations are improper, investors may unfairly pay more or receive less for their shares which can lead to diminished returns for investors as well as a loss of investor confidence.
IOSCO found from its preparatory review of the Principles that, whilst they have been broadly implemented and remain effective, there was a strong case for updating them. Since their publication, the market has evolved, with an increase in CIS holding less liquid and illiquid assets including private assets, as well as increased retail investment in such schemes. Evolving best practices in CIS valuations and the recent experience of valuation challenges during times of market volatility also inform this consultation.
The proposal consists of 13 updated recommendations, with key revisions covering the following areas: oversight arrangement, governance under stressed market conditions, management of conflicts of interest, fair value, backtesting, use of third-party valuation service provider, stale valuations and record keeping.
“This consultation marks a vital step in ensuring that valuation practices for collective investment schemes continue to remain robust and relevant in light of the evolving dynamics and developments, as well as increased sophistication in the markets today.”
– Jean-Paul Servais, IOSCO Board Chair
“In view of CISs growing exposure to less liquid and alternative assets, updating the valuation principles is essential to safeguarding investor confidence. The updated recommendations build upon and aim to consolidate and modernize the solid foundational framework laid out in the 2007 and 2013 principles.”
– Jessica Reyes, Chair of IOSCO’s Committee for Investment Management
Consultation feedback is requested by 2 February 2026. IOSCO aims to publish its Final Report in the second or third quarter of 2026.
Important Notes:
The 13 Updated Recommendations cover the following areas: policies and governance, conflicts of interest, methodology, use of third-party valuation service providers, consistency in valuation, pricing errors, timely valuation, disclosure practices and record keeping.
See Also:
IOSCO publishes Final Report on Neo-Brokers | Disruption Banking
IOSCO publishes Final Report on Financial Asset Tokenization | Disruption Banking
