LPAC by Design: Six Recommendations for GPs to Define LPAC Features During Fund Formation

Limited partner (LP) advisory committees (LPACs) have become fixtures of PE funds, with 95 percent of funds having one. While general partners (GPs) have learned to live with LPACs, their attitudes toward LPAC design is often still reactionary. The actual size and composition of the LPAC, along with the precise scope of its authority, frequently evolve during the fundraising process as LP requests are received. In a guest article, Vinson & Elkins partner Robert Seber argues that GPs must take a more proactive approach to designing their LPACs and provides six practical recommendations for GPs to define the scope of an LPAC in fund documents before negotiating with LPs. Several of the recommendations directly respond to positions endorsed by the Institutional Limited Partners Association. See our two-part series on the evolution of LPACs: “Trends Toward Robust Procedures and Accountability for LPAC Members” (Oct. 8, 2019); and “Grappling With GP and LPAC‑Member Conflicts of Interest While Avoiding Liability” (Oct. 15, 2019).

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