Private Funds In 2026: Aligning Structure, Process, And Proof

INTRODUCTION

General partners and fund managers have traditionally managed litigation risk mainly by adhering to the language and structure of fund agreements and maintaining formal corporate separation in the governance of fund and management entities. However, as private equity and private credit strategies have gone mainstream, scrutiny by regulators, counterparties, and even portfolio company stakeholders is increasing sponsor exposure to enforcement and litigation. Today, how decisions are actually made and documented is equally important to formal architecture of fund agreements.

Alongside structure, the key questions are now functional:

• Who made the decision in practice?
• Who benefited (and at whose expense)?