Advisory Committee (LPAC)
Private Equity glossary · Private Equity Fundamentals
Definition
Limited Partner Advisory Committee — a committee of typically 5-12 of the fund's largest or most active LPs, empowered by the LPA to approve conflicts of interest, valuation methodologies, fund extensions, co-investment conflicts, key-person events, GP-led secondary transactions, and other matters specifically enumerated. LPAC is the principal forum for LP oversight during the fund's life and is the gating mechanism for major GP-side actions that would otherwise create LP-GP conflicts. Membership is non-voting in some structures, voting in others.
Advisory Committee (LPAC) in plain English
When investors (called Limited Partners, or LPs) hand their money to a PE firm (the General Partner, or GP), they don't run the day-to-day — but they still want a watchdog. The LPAC is a small committee of the fund's biggest or most engaged investors that signs off on the touchy decisions where the GP might be tempted to favor itself: conflicts of interest, how assets are valued, extending the fund's life, and similar flagged matters. Think of it as a board of the most invested parents at a school, empowered to approve exactly the sensitive calls where the principal's interests and the families' might not line up — the main check on the GP while the fund is running.
Also called: LPAC
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Practice Advisory Committee (LPAC)
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