The Role of Investment Committee in AIFs – Checks Before Cheques

An Investment Committee (IC) is the gatekeeper of discipline in every AIF. SEBI now requires all IC members’ details to be disclosed in the PPM to avoid shadow decision-making.

Functions
• Approve or reject investment proposals as per mandate.
• Review valuations, exits, and follow-on funding.
• Ensure no related-party conflicts.

Investor Angle
Ask for IC composition and minutes summary in reports; independent representation signals strong governance.

Key Takeaway: Sound investments start with sound oversight.
 

Disclaimer: Educational only.