The European Private Equity and Venture Capital Association (EVCA) has launched the EVCA Handbook of Professional Standards for the Private Equity and Venture Capital Industry.
Private equity firms and their investors, including insurance companies and pension funds, have committed to a comprehensive joint set of professional standards for the first time in the industry’s history.
This reflects the unusually close alignment of interests between private equity firms and the institutional investors which invest in private equity.
The handbook brings together these groups under a unified set of values for the entire industry. In 2010, the EVCA expanded its membership to 106 institutional investors. The EVCA’s professional standards have now been expanded in order to reflect this unification.
The handbook is a public commitment by all EVCA members to mandatory principles of transparency, accountability and governance. It emphasises responsible investment, the importance of active ownership and the stewardship of portfolio companies.
EVCA secretary-general Dörte Höppner (pictured) says: “This is a significant milestone for our industry. The ability of the EVCA to bring private equity firms and the institutional investors which invest in private equity together gives us strength, credibility and influence when we speak for the industry.”
The handbook covers all the key relationships in private equity: private equity firm to portfolio company and to investor and investor to private equity firm, throughout the lifetime of a private equity fund. Written over 18 months and in consultation with the EVCA’s members, the handbook brings together and updates existing standards in clear and concise language. It will be updated every year and used in EVCA training courses to reinforce professional standards.
Claire Wilkinson, chair of the EVCA Responsible Investment Working Group and member of the EVCA Professional Standards Committee, says: “All of private equity has made a public statement of its guiding principles of honesty, fair dealing and responsible investment for the first time – and that’s a very important step.
“Responsible investment is hardwired into the EVCA Handbook, which is a living, dynamic document, which will be regularly debated and updated and could change how the industry communicates internally and the outside world.”
