The Institutional Limited Partners Association is introducing a set of guidelines designed to establish best practices for the private-equity industry.

The aim of the principles is to ensure the long-term viability of the asset class as an institutional investment strategy by bolstering governance, improving transparency and aligning the interests of limited partners and general partners, said Kathy Jeramaz-Larson, executive director of the ILPA.

“The ILPA private equity principles will establish an operating framework for investors to engage in ongoing dialogue and to develop improvements that will benefit the industry for years to come,” Jeramaz-Larson explained.

The ILPA has also formed a new best practices committee that will focus on continuing to strengthen private equity as an asset class by soliciting input from other private-equity practitioners and by keeping the principles up to date.

“Private equity has become an important strategy for most institutional investors from around the world as overall returns from private equity have outpaced those of other asset classes over the long run,” said Joncarlo Mark, chairman of the ILPA. “This is primarily the result of a traditionally strong alignment between general partners and their portfolio companies and a focus on growing these businesses. A similar alignment between the general partners and the supporting institutions that provide them investment capital will help ensure successful returns in the future.”