Private equity firms are starting to take action in response to a long-term problem: a lack of women in senior positions.
According to a poll of about 60 chief financial officers and other members of the PE industry at Private Equity International’s CFOs and COOs Forum in New York on Thursday, 52 percent are taking steps to increase diversity and a further 34 percent are thinking about it.
“It’s not a women’s issue, it’s an industry issue,” one CFO panelist said at the forum.
In May 2018, Level 20, a non-profit dedicated to improving diversity in the private equity industry, and the British Private Equity and Venture Capital Association released a report surveying 178 private equity firms with a presence in the UK. It showed that women only make up 6 percent of senior positions and 29 percent of the overall private equity workforce.
The industry does have a long way to go, but there are some steps that CFOs are taking.
“We hired a consultant to help disrupt unconscious bias around searches, compensation, performance reviews and other areas,” said one CFO panelist.
Another way firms can improve their diversity is by creating a pipeline where women can have an opportunity to become a serious candidate for an executive position down the line. Mentoring women working within a firm can be an effective tool, another panelist pointed out.
“We set up a mentoring program,” the CFO said. “We try to assign men [in leadership roles] to mentor women and not just have men mentoring men.”
The same CFO pointed out that when it comes to the interview process, firms should include a diverse interview staff if they are looking to appear more inclusive for candidates from underrepresented backgrounds.