Key Takeaway

• Chapter selection is the first credibility decision—it shapes everything downstream (scope, reports, verification readiness).
• Most confusion comes from mixing organizational labels with GIPS roles.
• The real question is: what role are you playing when you present performance—and to whom?
• Getting the chapter wrong creates rework, weak claims, and inconsistent reporting discipline.
• Treat GIPS as trust infrastructure, not a reporting template.

Most GIPS implementation problems don’t start with performance calculation. They start with identity.

Not your legal identity—your GIPS identity.

Because the first (and most expensive) mistake firms make is building a “compliance program” before they’ve answered the only question that truly governs everything that follows:

Are we presenting performance as an investment manager (a “Firm” in GIPS terms), or as an asset owner reporting on a total fund to an oversight body?

That single distinction is where chapter confusion lives—especially the classic tug-of-war between GIPS Standards for Firms and GIPS Standards for Asset Owners. And it’s not a small misunderstanding. The 2020 edition explicitly created separate provisions for firms and asset owners precisely because asset owners struggled with how the standards applied to them. It also draws a bright line: asset owners that market their services must follow the Firms provisions, while asset owners that do not market their services follow the Asset Owners provisions.

Why this trips people up in the real world

In practice, many organizations sit in the “in-between” space:

• A pension fund has an internal investment team that looks and behaves like an asset manager.
• A sovereign fund may publish performance publicly and also compete for co-investment mandates.
• A bank’s wealth unit might manage discretionary portfolios while also running advisory models.
• A holding company may have multiple regulated entities, each “held out to the public” differently.

So the confusion isn’t academic. It’s structural.

And the most common mental trap sounds like this:

“We’re an asset owner, so we follow the asset owner chapter.”

Sometimes that’s correct. But GIPS 2020 intentionally breaks that automatic assumption. If the organization is marketing its investment management services (even if it also happens to be an asset owner), the GIPS standards point you toward the Firms chapter for those marketed services.

The credibility risk is bigger than people think

Chapter selection isn’t “paperwork.” It’s the foundation for:

• What entity you define (and how broad your definition must be)
• What gets included (composites vs total fund; discretionary portfolios vs oversight reporting)
• Which report type you’re allowed—or required—to create
• How you describe compliance (and what language you must not alter or omit)

In other words: if you choose the wrong chapter, you can do a lot of work “perfectly”… and still end up with a claim that sophisticated prospects, consultants, or an experienced verifier will flag as mis-scoped.

A simple way to think about the root problem

Here’s the real reason chapter selection feels harder than it should:

GIPS is not organized around who you are on paper. It’s organized around what performance you are presenting—and to whom.

• If you are presenting performance as a manager competing for client assets, you’re in Firm territory.
• If you are presenting performance as an asset owner reporting on a total fund to an oversight body, you’re in Asset Owner territory.
• If you are an asset owner that also competes for business, GIPS even contemplates that you may need to treat yourself as both—either by bifurcating, or by applying the relevant provisions depending on the audience. (GIPS)

That’s why “Firm vs Asset Owner” is not a label. It’s a use-case.

What this post will do (and what it won’t)

This is not a generic overview of GIPS.

This is a chapter-selection playbook designed for the exact moment most teams get stuck: choosing between Firm and Asset Owner, and understanding why that choice is different in GIPS 2020 than it felt under prior guidance.

In the next section, we’ll cover what changed in GIPS 2020 that made this decision more explicit—and why that change is actually good news if you want to build a compliance program that stands up to real scrutiny.

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