INSTITUTIONAL INVESTOR SENTIMENT SURVEy - PEI Media

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Investors place a high emphasis on due diligence and regular reporting institutional investor sentiment survey Which processes are important when conducting due diligence? % 100 foreword executive summary 80 allocation 60 40 20 0 Pay a visit to the GP’s office(s) Speak with C-level professionals, including finance, operations, administrative Speak with deal professionals Speak with junior professionals at the GP fees • lp – gp relationship future investments and concerns appendix: global fundraising Source: Private Equity International As part of the due diligence process, 93 percent of survey respondents speak directly with the deal professionals and 87 percent visit the GP at their office. LPs place value on speaking with the key personnel in the deal process and communicating with them directly and face-to-face. In addition, 68 percent of respondents stated that they spoke with junior professionals at the GP and 71 percent of respondents spoke to C-Level professionals at the GP as they have knowledge of key data despite not being accountable for the fund. Overall the responses illustrate the high emphasis investors place on due diligence and regular reporting. There are many varied methods of due diligence, however regular reporting, meetings with key personnel at the GP and advisory boards as well as assessing the viability of portfolios, performance and processes are all an important part of the process. page 23 www.privateequityconnect.com
A vast majority of LPs conduct due diligence on the compliance operations of GPs institutional investor sentiment survey foreword executive summary allocation fees lp – gp relationship • Does your institution conduct due diligence on the compliance operations of a fund manager? future investments and concerns n n n 45% 43% 12% Yes, extensively Yes, minimally No appendix: global fundraising Source: Private Equity International page 24 The vast majority of investors conduct due diligence on the compliance operations of fund managers, whether extensively or to a minimal extent. Altogether 88 percent of LPs stated that they undertake this process with GPs versus the 12 percent of respondents who did not. There are a similar proportion of investors who recognise compliance extensively as well as those who investigate this to a minimal extent. A good compliance program includes developing policies and procedures designed to prevent violations of securities law, creating a code of ethics, maintaining records of these policies, conducting an annual review of these procedures and even appointing a Chief Compliance Officer. It is clear that regulatory developments, including the introduction of the Dodd-Frank Act in the US, have had a profound effect on private equity fund managers both directly and indirectly. www.privateequityconnect.com
Page 1 and 2: Institutional Investor Sentiment Su
Page 3 and 4: institutional investor sentiment su
Page 5 and 6: LP Respondents Breakdown Where is y
Page 7 and 8: Allocation institutional investor s
Page 9 and 10: Over the long-term, private equity
Page 11 and 12: Co-investments provide LPs with gre
Page 13 and 14: Fee breaks should be negotiated dep
Page 15 and 16: Fees should be calculated in connec
Page 17 and 18: LPs are requesting a “Europeansty
Page 19 and 20: GP fund commitments should be a mea
Page 21 and 22: SWFs prefer to target sectors which
Page 23: institutional investor sentiment su
Page 27 and 28: There is room for improvement with
Page 29 and 30: Focus on… Endowments Distribution
Page 31 and 32: Strategy Appetite institutional inv
Page 33 and 34: institutional investor sentiment su
Page 35 and 36: The prevalence of zombie funds has
Page 37 and 38: Private equity is coming under incr
Page 39 and 40: Fundraising by Strategy 150 institu
Page 41: Published in July 2012 by PEI Secon

INSTITUTIONAL INVESTOR SENTIMENT SURVEy - PEI Media

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