Published 19th of November 2022 by Nina

Private Equity Sector Lags in Diversity Progress

A multi-year research project assessing #gender #diversity within the #privateequity industry has just been released, and its findings are illuminating.

As the opening line of the article by HEC Paris Professor and MJ Hudson Fund Performance Analytics Research Head Oliver Gottschalg declares “despite arguments to the contrary…improving gender diversity does increase private #equity returns but [nonetheless] progress is still slow compared with other #business sectors.”

The arduous and long-running study and modelling analytics, gathering data on over 300 private equity firms, which gave way to over 80,000 data points from years 2007 to the present day, observes:-

- Over the last 15 years, the percentage of #women has grown, but very slowly, and remains incredibly low.
- Women now comprise 20% of all #investment staff, “with the share in #leadership positions finally cracking the 10% mark.”
- Greater diversity could lead to outperformance of “11 cents on every dollar invested.”

“Recruit and train” says Gottschalg, in the fight for more diversity through the private equity ranks. One might also add, alongside, the further inculcation elements which partner with diversity, i.e. #equity#inclusion and #belonging.

As Gottschalg confirms through not only his belief but also very comprehensive data, there’s not only principled reasons for #DEIB but also a strong business case for it.


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