| Institutional Limited Partners Association (ILPA) | |
|---|---|
| Formation | 2002 |
| Type | Trade association |
| Purpose/focus | Private equity |
| Membership | 250+ institutional investors |
The Institutional Limited Partners Association (ILPA) is the global, member-driven organization dedicated to advancing the interests of private equity limited partners through industry-leading education programs, independent research, best practices, networking opportunities and global collaborations. Initially founded as an informal networking group, the ILPA is a voluntary association funded by its members. The ILPA membership has grown to include over 250 member organizations from around the world representing over US $1 trillion of private assets globally.
The ILPA was founded in the early 1990s.
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The ILPA is the only global organization dedicated to the interests of Institutional Limited Partners in private equity. Its membership consists of over 250 member organizations spanning all categories of small and large institutions including: Public Pensions, Corporate Pensions, Endowments, Foundations, Family Offices, and Insurance Companies International representation from North America, UK, Europe, Asia, Australia, South America, New Zealand and the Middle East. Membership represents well over US $1 trillion in private equity assets under management.
The limited partner investor universe in private equity has historically been highly fragmented and individual investors, even the largest investors, often have limited ability to negotiate the terms of the individual private equity funds to which they commit.
ILPA's education and networking functions allow greater communication and collaboration between investors. ILPA was actively involved in discussions centering around the adoption of fair value accounting under of FAS 157.[1][2]
In September 2009, ILPA released a set of guidelines, the Private Equity Principles[3], intended to provide a common set of terms which institutional limited partners could use as the basis for negotiation with fund managers.[4]
Recognizing a need to establish Best Practices regarding fund partnerships between Limited Partners and General Partners, the ILPA has developed the Private Equity Principles (the “Principles”), the first document of its kind for the private equity industry.
These Principles were developed with the goal of improving the private equity industry for the long-term benefit of all its participants by outlining a number of key principles to further partnership between LPs and GPs. Over the past year, ILPA has heard numerous success stories regarding improved communication between LPs and GPs. To date there have been 2 versions of the Principles developed: Principles Version 2.0 – Released January 2011 Principles Version 1.0 – Released September 2009
Going forward, ILPA will issue further appendices, where relevant, to the updated 2011 Principles to address new topics as industry best practices continue to evolve. ILPA Standardized Reporting Templates
The ILPA has been working, in conjunction with GPs and LPs, to develop a set of Standardized Reporting Templates to not only improve transparency between the general partner and limited partner communities but to generate industry efficiencies. The Standards will allow for consistency of reporting, uniformity of information, reduction in time required to reconcile reports and less time responding to questions from investors on various and sundry items. The Capital Call & Distribution Notice Templates were released in January 2011 and the new Quarterly Reporting Standards were released October 18th, 2011. The adoption of these reporting guidelines will serve several purposes, including, but not limited to: - Enabling the LP to interpret & account for a transaction accurately - Reducing LP and GP processing times and ultimately reducing monitoring costs - Improving LP-GP communications in regards to an investment’s status and thereby minimizing required follow-up questions - Enabling GP compliance with legal terms in documentation
The goal of the ILPA is to continue to evolve the organization’s research and education platforms and build out best practice tools for use by industry professionals. Under the research platform, the ILPA addresses key issues that impact private equity, including regulatory reform, risk management, and the amount of capital circulating in the industry. The creation of the ILPA Institute fulfills a long-time goal of providing a structured, comprehensive executive education program designed from the perspective of the limited partner. The most recent version of the ILPA Private Equity Principles was published in January 2011 together with standardized reporting templates for Capital Calls and Distribution Notices. In an effort to enhance and improve investor reporting and transparency, the ILPA also constructed the Quarterly Reporting Standards in collaboration with general partners, auditors and industry third-parties. The ILPA strongly believes that the limited partner and general partner communities will mutually benefit from these best practices and by working collaboratively to seek business solutions that support investment value creation. In addition to the Annual General Partner Summit, the ILPA hosts two Members-Only Conferences annually, and several regional events throughout the year to allow its members the opportunity to connect with their fellow LPs. The goal of facilitating quality networking opportunities and providing an environment that encourages long-term relationship building remains a priority for the organization.