LPAC (Limited Partner Advisory Committee)

The Limited Partner Advisory Committee (LPAC) is a representative body of LPs tasked with overseeing conflicts, governance exceptions, and extraordinary fund decisions.

From an allocator lens, LPACs reveal whether governance is collaborative and substantive — or merely consultative with no real authority.

How allocators define LPAC effectiveness drivers

Allocators assess LPACs based on:

• Authority scope: advisory vs consent/approval rights
• Decision domains: conflicts, extensions, valuations, waivers, transactions
• Composition: independence, diversity, concentration of power
• Information access: timing, completeness, and comparability of disclosures
• Cadence: routine governance vs reactive emergency sessions
• Documentation: minutes, resolutions, dissent handling
• Consistency: same process under stress and in down markets

Allocator framing:
“Does the LPAC influence outcomes — or simply acknowledge decisions already made?”

Where LPACs matter most

• continuation vehicles and secondaries
• multi-fund managers allocating opportunities across vehicles
• strategies with valuation discretion (venture, credit workouts)
• funds with bespoke side letter governance rights

How LPAC design changes outcomes

Strong LPAC design:

• improves conflict handling transparency
• reduces “surprise governance” later in the fund’s life
• increases allocator confidence in exception management

Weak LPAC design:

• hides conflicts until late-stage decisions
• increases trust erosion during volatility
• makes exceptions feel unilateral, not governed

How allocators evaluate LPAC credibility

Conviction increases when managers:

• define what requires LPAC approval vs LPAC consultation
• provide materials before decisions become irreversible
• show consistent conflict escalation workflows
• demonstrate precedent (how prior conflicts were handled)

What slows allocator decision-making

• LPAC is “review only” in all meaningful cases
• membership is concentrated with one anchor controlling outcomes
• inconsistent disclosure or poor documentation
• LPAC materials delivered after decisions are effectively made

Common misconceptions

• “LPACs slow a manager down.” → clarity often speeds fundraising.
• “Only large LPs matter on LPAC.” → credibility comes from independence.
• “LPAC manages the fund.” → governance ≠ investment selection.

Key allocator questions during diligence

• Which actions require LPAC approval?
• How are conflicts defined, escalated, and documented?
• Who sits on the LPAC and how are members selected/rotated?
• What is the turnaround time for LPAC decisions?
• How do you handle dissent and documentation?