ICYMI – New survey shows LPs see little need for more regulation of PE
“80 percent of LPs reported feeling more favorably towards PE”
Earlier today, PE Hub covered the results of a recent survey conducted by FTI Consulting and commissioned by the American Investment Council showing that a majority of limited partners (LPs), including professionals at pension funds, endowment funds, foundations, and family offices- are satisfied with the current levels of regulation governing the private equity industry. The survey was conducted just as the U.S. Securities and Exchange Commission (SEC) announced burdensome and unnecessary private fund advisers rules that would make it harder for private equity to help businesses grow and support retirees who depend on private equity returns in their pensions.
The survey also found that more than 80 percent of LPs reported feeling more favorably towards private equity over the last twelve months.
LPs see little need for more regulation of PE
By Mary Kathleen Lynn
July 5th, 2022
Today, I’ve got results from a new survey about regulations from the LP perspective. This one is from the American Investment Council, an advocacy and resource organization, and conducted by FTI Consulting, a business advisory firm.
Does the private equity industry need more regulations? No, according to most LPs who took the survey.
The majority of LPs (54 percent) said they are satisfied with the current level of regulation, and only 6 percent said they consider private equity to be “under regulated.”
“This new survey demonstrates our investors believe that the private equity industry is appropriately regulated and brings into question why Washington regulators continue to move full steam ahead with new, burdensome regulations that will impact private capital investment that strengthens pensions,” Drew Maloney, president and CEO of AIC, told me.
LPs seem pretty happy with private equity just as it is, according to the survey. If anything, LPs like the asset class more and more. When asked how their opinions of private equity have changed over the past 12 months, 80 percent of LPs reported feeling more favorably towards PE.
“We are encouraged to see that investment officers across America clearly value their relationship with the private equity industry,” Maloney said. “Investors appreciate private equity’s strong returns and recognize our industry for excellence in ethics, responsibility, long-term perspective, active management, and customer-oriented service. In this challenging environment, we need policies that recognize what LPs know: private equity is critical to supporting jobs, retirement plans and economic growth.”
The survey, which was conducted from April 8 to May 4, included 106 senior investment professionals at pension funds, endowment funds, foundations and family offices.