Insights
Acertitude: Building Diverse and Inclusive Private Equity Boards
Private equity firms are increasingly introducing targets around board diversity, which is unsurprising given the supporting data evidencing board diversity being directly linked to board effectiveness, with more diverse boards outperforming boards that lack diversity. Where GPs are in terms of formalising targets for board diversity varies significantly depending on fund size, industry focus, regional focus, and VCP (e.g., turnaround vs. growth). What is evident, however, is that the topic is increasingly front of mind.
Data published by the EDCI (ESG Data Convergence Initiative) shows that private markets lag significantly behind public markets when it comes to gender diversity on boards, with 57 percent of private companies having one woman on the board as of last year, compared to 87 percent of public companies. Interestingly, gender diversity across the broader C-suite (excluding executive board members, i.e. the CEO and CFO) in private companies outperforms public counterparts, at 22 percent versus 17 percent.
Learn more about how to build a diverse and inclusive private equity boards.