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This paper proposes control strategies to equalize capacitor voltages in neutral clamped shunt compensator for 3phase, 4-wire distribution systems. The compensator comprises of a voltage source inverter, two dc storage capacitors and a two-quadrant chopper. The compensator topology is capable of compensating loads containing ac as well as dc. However, a significant problem in the compensator is the capacitor voltage imbalance and drift due to dc component of the current in the neutral path. This degrades the performance of the compensator and must be corrected. This paper describes three control strategies namely single pulse, multi pulse and open loop duty cycle control to regulate the voltage of each capacitor to a reference value. This ensures the correct performance of the compensator. The operation of a 440 V, 3-phase, 4-wire system supplying an ac unbalanced load and a 3-phase half bridge rectifier is studied. The simulation results show the effectiveness of chopper control in eliminating the voltage imbalances in the capacitors. The open loop duty cycle control scheme has also been verified by experimental results.