What is the investment community?

The investor community refers to all investors in an investment fund, while the advisory committee serves to bring together a handful of investors who are supposed to represent that community.

The community brings together dozens, sometimes hundreds, regardless of the size of their investment or nature. It is composed of natural persons, legal persons, pension funds, family offices, sovereign wealth funds, funds of funds, etc.

This community is therefore the shareholding of an investment fund. However, their rights are much more limited than those of shareholders in a trading company. They do not decide on the fund's investments. This privilege is left to the full discretion of the manager. They have limited access to the fund's accounts and decisions. Some amendments to the statutes may be made without their approval.

In the majority of structures, the community does not even vote for the approval of the annual accounts. It meets once a year to receive a summary of the activities from the manager.

The Advisory Committee intervenes in the first violations of investment policy. Only fundamental decisions, in strict contradiction with the original regulation, fall within the competence of the community as a whole. These decisions go beyond not only the competence of the manager, but also that of the advisory committee, because they affect key elements.

The extension of the investment period commits all investors to pay a management commission to the manager. It is therefore right that all investors be consulted on it. The more power the investor community, the stronger the alignment between the manager and his investors. The statutes may provide for interventions on many subjects: subscription period, investment, lifespan, conflict of interest, etc. It is necessary, however, to ensure that these powers do not hinder and increase the action of the manager. If the latter wants to seize an opportunity quickly, it must be able to do so, it will benefit the entire community.

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