Compliance
Compliance is the set of policies and controls that ensure a manager operates within legal, regulatory, and fiduciary obligations.
Definition
Compliance covers regulatory registrations where applicable, codes of ethics, trading policies, conflicts management, marketing rules,, privacy controls, and internal monitoring. Strong compliance reduces legal risk, reputational risk, and operational failures. Allocator Context Institutions—especially pensions, endowments, banks, and insurers—require strong compliance standards and documented controls. Even where regulation differs by jurisdiction, allocators expect consistent governance discipline. Decision Authority Compliance standards are evaluated during ODD and legal diligence. Material deficiencies can block allocations. Some allocators require specific compliance attestations or ongoing reporting. Why It Matters for Fundraising Compliance maturity is a trust signal. Managers should present compliance processes factually and transparently. Overstating compliance capabilities is risky; under-documenting them slows approvals. Key Takeaways Reduces legal and reputational risk Often a gating diligence item Documentation matters as much as intent Strong compliance supports institutional fundraising