SD-04.5 — Investment Approval & Authorisation

Business Domain: BD-04 Direct & Co-Investment (Front office) · Applies: PRIV

Purpose

Operates the formal decision body that approves or rejects a direct investment against the mandate. The Investment Committee is the governance gate the BD-04 deal chain runs through: it is where the diligence and structuring work is synthesised into a recommendation, challenged, and turned into an authority to invest — or declined. It owns the IC memorandum, the decision, and the conditions the approval is subject to. The decision record is E-34 Investment Authorisation, and on this route its natural subject is the deal itself — with the deal record first-class (PM-15 Deal / Investment Opportunity), a direct_investment authorisation’s subject_id points at the PM-15 deal under decision (or, for authorisations framed directly against a mastered target, at the portfolio company or real asset). SD-04.5 is the IC capability for the direct-investment route; SD-03.9 Fund-Commitment Approval & Authorisation is the parallel IC capability for the fund-commitment route. A real firm may operate one IC body across both routes or two separate bodies — the OpenIM model carries them as distinct capabilities.

Service Operations

• Author the investment-committee memorandum — the investment thesis, the value-creation plan, the synthesised diligence findings, the key risks and mitigants, and the financial model with base, upside and downside cases.
• Present to the investment committee — table the memorandum and field the committee’s challenge.
• Record the decision — approve, decline or approve-with-conditions, and minute the decision.
• Define conditions precedent to investment — the conditions the committee attaches to an approval.
• Approve the bid authority — the final bid or firm-offer authority and the equity or commitment cheque size.

Inputs and outputs

• Inputs: the diligence pack (SD-04.3); the deal structure and term sheet (SD-04.4).
• Outputs: the IC memorandum, the IC decision and minutes, the approved bid authority and the IC conditions — consumed by SD-04.6 Deal Execution & Legal Closing.

Entities

• Consumes: Legal Entity (E-01), Portfolio / Mandate (E-03) — the investment is approved against the mandate; PM-15 Deal / Investment Opportunity — the deal under decision, the direct-route authorisation subject; the SD-04.3 diligence pack; the SD-04.4 deal structure and term sheet.
• Owns: E-34 Investment Authorisation — co-owned with SD-03.9 Fund-Commitment Approval & Authorisation. One concept, two co-equal owners: the direct-investment IC view (SD-04.5) and the fund-commitment IC view (SD-03.9) of the same kind of governance record — the IC memorandum, the decision, the conditions, the authority and mandate verification, the dissent. The investment_route = direct_investment records the route, but it is not a partition key; the two SDs co-own the entity outright in the E-27 pattern. The full pattern is documented in ownership-map.md.

Standards

• No external standard governs the investment committee. The IC memorandum as the canonical synthesis artefact, and the staged committee (preliminary and final IC), are practitioner conventions. The committee operates within the firm’s governance framework (BD-16 maintains the corporate governance structure; BD-14 maintains the enterprise-risk and control framework the committee’s risk-appetite operates within).

Open extensions

• The boundary with SD-16.1 Corporate & Fund Governance — SD-04.5 runs the investment decision; SD-16.1 maintains the committee’s governance and mandate.