A reduction in the management fee paid by LPs equal to a specified percentage of transaction fees, monitoring fees, director fees, and other portfolio-company-paid amounts received by the GP. Historically, 50% offset was standard; modern institutional norm is 80-100%, with ILPA Principles endorsing 100% as best practice. Most large U.S. buyout GPs now offset 80-100%. The offset corrects the original alignment failure of GP-charged portfolio-company fees, which once represented a substantial GP revenue stream layered on top of management fees and effectively double-charged LPs.