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Member Code of Conduct

Membership of the BVCA implies support for the development of the UK private equity industry by encouraging entrepreneurs and investing in viable economic activity. In addition, members should contribute to the creation of a favourable climate for companies seeking private equity.

Each General Partner applicant must have, as its principal business, the provision of equity finance to unquoted companies and make its returns mainly through medium to long-term capital gain and an investment capability in the UK; take an active role in helping to build and develop the companies in which it invests, and be a member of a recognised regulatory authority where appropriate. All other applicants must have a number of staff with experience of working in the private equity industry and have a record of providing services to private equity firms or their portfolio companies in the UK or globally.

Each member firm must agree to abide by the following terms of the BVCA Member Code of Conduct

Code one

All members shall promote and maintain ethical standards of conduct and at all times deal fairly and honestly with each other and with companies seeking private equity.

Code two

All members shall conduct their business in a professional way and will not engage in practices which would be damaging to the image of the private equity industry. Within their own firms (and portfolio companies), members will promote the principles of equality and diversity, equal opportunities, anti-discrimination and anti-harassment. The BVCA has endorsed Level 20’s guidelines for private equity firms.

Code three

No member shall take improper advantage of its position in the BVCA, nor of any information addressed to the BVCA.

Code four

General Partner and Limited Partner members, where applicable, recognise that their primary business is building the strength of their investee companies, which will result in the funds under management making long-term capital gains.

Code five

Membership of the BVCA implies an active involvement by General Partner and Limited Partner members, where applicable, in the companies in which they invest and this involvement shall be applied constructively to the benefit of the company concerned.

Code six

Members who sponsor investment syndications with other parties, whether members of the BVCA or not, must operate on the basis of full disclosure to such other parties.

Code seven

General Partner and Limited Partner members, where applicable, will not accept in their funds subscribed capital from unspecified sources.

Code eight

General Partner and Limited Partner members, where applicable, shall be accountable to their investors and keep their investors fully and regularly informed, including the provision of regular financial reports.

Code nine

General Partner and Limited Partner members, where applicable, shall respect confidential information supplied to them by companies looking for private equity investment or by companies in which they have invested.

Code ten

All Full Members must supply investment and performance information to the BVCA or its nominated agent. This information will be treated confidentially and used in the compilation of private equity industry reports where only aggregate information will be published.

Members shall require their directors, employees, representatives and nominees to comply with these standards. Members will avoid financing enterprises or participating in activities, which are inconsistent with these goals.

Turnaround Code

BVCA Code of Conduct for Turnaround Investors and BVCA Members Encountering Turnaround Situations

Every year many businesses are saved from collapse by turnaround investments made by private equity firms who provide a critical injection of capital, ideas and execution skills to underperforming or failing companies. The BVCA has a voluntary code of conduct for members engaged in turnaround activity. Members of the BVCA who sign up to the Turnaround Code agree to the following commitments:

  1. BVCA members aim at business rescue rather than closing a business to realise its assets.

  2. The positive and negative impact on lives of employees, customers and creditors will be carefully considered before investment. To the extent that the investment results in a negative impact on these lives, the investor will ensure that communication is clear to ensure that the affected people can make alternative plans where necessary and due process is followed.

  3. Interest rates charged on any debt funding will be set commensurate with the risk. Investment will be made with the dual aims of improving business and saving, or better, growing, where possible employment whilst also generating an acceptable return for investors who have funded the turnaround.

  4. Insolvency procedures should not be considered the default option. Alternatives which may achieve a better all round outcome (e.g. agreeing compromises with creditors or a pension scheme outside of formal insolvency) should be considered carefully before insolvency routes are adopted. However in some circumstances, where for example a business is exposed to large and uncertain liabilities, insolvency will be the only route to save a business.

  5. In the event of pre pack administrations, investors will request Insolvency Practitioners to ensure compliance with Statement of Insolvency Practice 16 as issued by the Insolvency Regulatory Body, R3.

  6. The investors will annually provide feedback to the BVCA on their turnaround activities to ensure that the BVCA can properly communicate with key stakeholders such as government bodies and the press about the turnaround activities of its members.
Further information


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