The Association for Corporate Growth, a trade organisation whose members include many mid-market US private equity firms, has begun to monitor regulatory issues in Washington DC and issue reports and updates to its members.
ACG amended its bylaws last year to allow this activity – previously ACG was explicitly forbidden from doing public policy work. But with a number of potentially troubling laws being debated at the moment, including a tax hike on carried interest and the possibility that fund managers will be forced to register with the Securities and Exchange Commission as investment advisors, ACG’s members began asking ACG for help, said Gregory Fine, ACG’s vice president of marketing and communications. Fine leads the day-to-day operations of the new initiative.
ACG formed a special committee, called the “External Relations Committee”, to monitor developments on Capitol Hill and report back to its members. The committee has a standing membership of 11, including Pamela Hendrickson, chief operating officer at The Riverside Company. Hendrickson has testified before Congress on behalf of private equity before.
The US private equity industry has a registered lobbying association, the Private Equity Council. But the PEC initially restricted its membership to the largest mega buyout firms. Smaller mid-market firms approached ACG for help, Fine said.
The ACG is not registered as a lobbyist, so it does not advocate on behalf of the private equity industry. But it does give members information on how they can contact their Senators, and provides help structuring talking points and communications for members’ interactions with lawmakers.
“We encourage members to pick up the phone and call members of Congress,” Fine said.
The PEC and ACG have begun to collaborate. The PEC has broadened its focus in recent months and has opened its membership to smaller firms.
“They are a force on the ground in DC and have been following the issues,” Fine said. “They provide information that we're able to share with our members.”
Though ACG’s members do not share all of the PEC’s members' concerns, and vice versa, there are many areas where their interests overlap, including the tax treatment of carried interest, Fine said.
ACG also coordinates with other organisations on regulatory issues, including the US Chamber of Commerce and the National Small Business Association.
“Our goal is to make sure our members know what's happening in Washington, and to give them the tools they need to adapt,” Fine said.