Really interesting article on the paucity of women at senior levels in PE. Undertaken by Preqin it shows showed the percentage of female board seats at private equity firms was just 5.2% in 2018 and of the more than 280,000 industry professionals in its database just 17.9% of PE employees worldwide are women and only 9.9% of senior roles at PE firms are occupied by women.
One thing agreed upon by many governance experts is that more diversity in senior teams leads to less groupthink, which can in turn lead to more efficient decision making and, subsequently, greater financial performance. So it is counter-intuitive that any organisation looking to maximise financial performance wouldn't also focus on diversity as a metric.
What is also really interesting, but the article doesn't cover, is that there is also a paucity of women in PE portfolio companies. I am leading a search for a CFO of a PE backed company currently - and there are a number of PE houses here in the UK that have absolutely NO female CFO's in their portfolio companies. So the pool of talented women CFO's who have PE experience is significantly smaller than the pool of male CFO's with experience of working for a PE backed organisation.
All credit to my PE client who really wants a balanced shortlist. And guess what - my PE client is a woman!!
Private equity is catching a lot of flak at the moment — from politicians who see the investment class as plutocratic, investors who seek stronger regulatory scrutiny of the industry and insiders who aim to break the glass ceilings keeping women from rising through their ranks. The industry has made some progress on the latter issue. A Preqin study released in February showed the percentage of female board seats at private equity firms climbed to 5.2% in 2018 from 4.1% in 2017. Preqin’s analysis of the more than 280,000 industry professionals in its database also found, however, that just 17.9% of private equity employees worldwide are women and about 9.9% of senior roles at private equity firms are occupied by women.