Carried Interest

First Quarter President’s Report

By: Steve Judge


The first quarter of 2015 saw an increase in partisanship and a focus on international issues, which made substantive legislation more difficult to achieve. We continue to…

By: Steve Judge


The first quarter of 2015 saw an increase in partisanship and a focus on international issues, which made substantive legislation more difficult to achieve. We continue to engage with lawmakers and their staff, understanding that our current legislative efforts are critical to our long-term success. We have already had a busy and successful regulatory agenda this year, held several PEGCC committee meetings, and continued to engage the media.  Along with these matters, growing our membership remains a principal organizational goal.


I am pleased to announce we have added Resource Capital Funds and GI Partners to our membership, and PwC, Goodwin Procter, and O’Melveny & Meyers to our associate membership. We will continue our recruitment of industry-leading, well-regarded firms this year.

The Council currently has over 30 events planned for the year.  So far this year, we have held multiple regulatory committee calls, our Chief Compliance Officers’ Working Group meeting, and our Founders Meeting and Dinner.


Two recent tax proposals, one authored by Sens. Marco Rubio (R-FL) and Mike Lee (R-UT), and a second sponsored by Congressman David Nunez (R-CA), threatens interest deductibility. To counter these measures, we continue to educate lawmakers and their staffs on our positions and explain the detriments of altering tax policies important to our industry.

Mounting regulatory concerns also required our attention in the first quarter, and we have successfully engaged on a number of issues. We helped obtain favorable Volcker Rule clarification from regulators on the ability of foreign banks to continue investing in private equity, and we drove favorable changes to a German regulation related to investments by German insurance companies and German pension plans in private equity funds organized in an Organisation for Economic Co-operation and Development (OECD) country and run by U.S. private equity firms. We filed four comment letters and continue to meet with the appropriate agencies for the regulatory issues of concern to the private equity industry.

Our Portfolio Company Initiative continues to serve as an effective advocacy program by providing Members of Congress with concrete examples of how private equity drives economic growth in their states and districts.  This quarter, we secured meetings with nine Members of Congress and key congressional staff by arranging a portfolio company CEO Day on the Hill and a portfolio company site visit.


Shaping an accurate, positive image of our member firms is an important goal for the Council. Private equity is complex and often misunderstood by the media and public at large. We seek out opportunities for our senior staff to utilize media engagements, industry conferences, and other fora to tell our story. This quarter our senior staff spoke at seven industry events, gave a university lecture, and contributed two opinion pieces to private equity-focused publications.


With key regulatory wins and a consistent presence on Capitol Hill to start 2015, our advocacy efforts were strong in the first quarter. We have upcoming research products, portfolio company visits, and earned media opportunities that will contribute to our efforts by providing a positive industry image, and our membership events will keep our member firms informed and engaged. We will continue to recruit new members, which will provide us with a broader membership base to represent and serve our industry.