Santiago Principles Self-Assessment

Alaska Permanent Fund

Fund Details Fund Website Search Assessments PDF version
  • Pillar 1: Legal
  • Pillar 2: Institutional
  • Pillar 3: Investment
Principle 1

1. The legal framework for the SWF should be sound and support its effective operation and the achievement of its stated objective(s).

1.1. The legal framework for the SWF should ensure legal soundness of the SWF and its transactions.

1.2. The key features of the SWF’s legal basis and structure, as well as the legal relationship between the SWF and other state bodies, should be publicly disclosed.

The Alaska Permanent Fund (“Permanent Fund” or “Fund”) is established under Article IX Section 15 of the Constitution of the State of Alaska. The mandate for the Fund is clearly stated calling for a minimum of 25% of all mineral royalties to be placed in the Fund, and directs that the Principal shall be used only for income producing investments as designated by law. Alaska Statutes 37.13 provide the statutory framework for the objectives and management of the Fund. 

The Permanent Fund is a pool of assets owned directly by the State of Alaska. The Permanent Fund has no legal identity or organizational structure separate from the State of Alaska.

Alaska Statutes 37.13 establish the Alaska Permanent Fund Corporation (“APFC” or “Corporation”) to manage and invest the assets of the Permanent Fund. APFC is a “public corporation and government instrumentality in the [Alaska] Department of Revenue managed by the board of trustees.”  The Board of Trustees acts as the Fund’s fiduciary.

Alaska Statutes 37.13.120 outline the investment responsibilities and provide that the “prudent-investor rule shall be applied by the corporation” in the management and investment of Fund assets. 

The applicable sections of the Alaska Constitution, Alaska Statutes and Alaska Administrative Code that govern APFC are all public documents.  All of these documents are publicly available and posted on our website:


Principle 6

6. The governance framework for the SWF should be sound and establish a clear and effective division of roles and responsibilities in order to facilitate accountability and operational independence in the management of the SWF to pursue its objectives.

Alaska Statutes establish APFC as a separate statutory agency to manage and invest the assets of the Permanent Fund.  The Board of Trustees is created in state law to manage APFC and oversee the Fund’s investments.

APFC’s Board of Trustee has established By-Laws, Governance, Investment Policies and Resolutions to provide a sound management structure.

Principle 18

18. The SWF’s investment policy should be clear and consistent with its defined objectives, risk tolerance, and investment strategy, as set by the owner or the governing body(ies), and be based on sound portfolio management principles.

18.1. The investment policy should guide the SWF’s financial risk exposures and the possible use of leverage.

18.2. The investment policy should address the extent to which internal and/or external investment managers are used, the range of their activities and authority, and the process by which they are selected and their performance monitored.

18.3. A description of the investment policy of the SWF should be publicly disclosed.

The APFC Board has posted its Investment Policy at  This document states that the investment objective for the Fund is to achieve a 5 percent real rate of return or better, with risk levels that are broadly consistent with the Fund’s peers.  The Policy states that the Board will review the Fund’s asset allocation on an annual basis and make necessary adjustments to meet the risk and return goals. 

The APFC Investment Policy states that total portfolio risk for the Permanent Fund should be comparable to its peers.  Alaska law prohibits the use of leverage overall unless it is structured to allow no recourse to the Fund.  

The APFC Investment Policy specifically allows for internal management of the Permanent Fund’s fixed income portfolio, selected Exchange-Traded Funds (ETFs), and selected private market investments.  All other investments, by default, are managed by external managers. The Policy provides the process for conducting manager searches, monitoring manager performance and, when necessary, terminating managers.  

APFC’s Investment Policy and related Board resolutions are posted at