Comprehensive data that illustrates long-term diversity trends across private markets globally is hard to come by. But some firms and industry bodies are gathering increasingly large data sets that offer insights into the state of play in certain functions, asset classes and geographies.

The British Private Equity and Venture Capital Association and not-for-profit diversity body Level 20 published in May their Diversity and Inclusion Report 2023, which found that women now hold 11 percent of senior investment roles in UK private equity and venture capital firms, including their European offices. That figure has risen by 5 percentage points over the past five years, with a similar upward trajectory evident in mid-level investment roles (now 23 percent female), and at the junior investor level (37 percent in 2023).

However, 17 percent of investment teams within these firms’ UK-based offices are all-male and 26 percent are all-white, though ethnic diversity data is far more limited. The proportion of senior individuals that are Asian, Black or other ethnicities is just 10 percent. Meanwhile, Level 20’s latest pan-European Gender Diversity Report shows an average of just 10 percent women in senior investment roles in European firms, excluding the UK, with an average of 38 percent all-male investment teams across the region.

Gurpreet Manku, chief executive of Level 20, says: “When we look at the data for UK firms [across their European and UK offices], we are starting to see progression in investment roles. The number of women in junior roles has increased, while the number of women in mid-level roles is a bit lower, but there is a decent pipeline there. That is why the focus now needs to shift to keeping women in the industry and supporting them to progress.”
Level 20 recommends firms focus on retention and progression, promoting an inclusive culture and continuing recruitment efforts while investing in more transparent processes, policies and data. Here are three practical steps that managers tell us are now tangibly making a difference.

1Track the data

‘We can’t improve what we can’t measure’ goes the saying, and data has become a huge element of diversity conversations in recent years as crunching numbers, setting targets, benchmarking and taking accountability for progress has moved into the spotlight. The data set available from Level 20 and the BVCA on gender diversity in particular now includes 268 firms and some 13,500 employees in Europe, while the number of firms providing ethnicity data is also on the rise.

But in addition to recording robust diversity data, firms must scrutinize those numbers, analyzing aspects like deal assignments, performance, promotions and attrition to look for trends. Manku says: “Fundamentally, it is for the firm to think about where they are on their DE&I journey, where they are having challenges and what they need to focus on. If you are doing things that are not working, stop doing them and focus on things that are more effective.”

Some diversity characteristics are easier to measure than others, and in many jurisdictions there are regulatory restrictions on data collection on privacy law grounds. But firms can overcome those barriers.

Maria Stasse, co-head of human resources at Ardian, says: “We know that if we want to progress we need to measure, and that is true for gender but also for other types of diversity. In France, it is very complicated to measure ethnic diversity and we were one of the first French private investment firms to launch an internal diversity barometer, which has been one of our best initiatives. We use that to provide a picture of our workforce, to look at inclusion, which is very important when we talk about retention, and to get the views of our employees on our DE&I strategy. That is the basis for a lot of the new initiatives we run.”

“We know that if we want to progress we need to measure, and that is true for gender but also for other types of diversity”

Maria Stasse,

2Bring everyone onboard

While top-down initiatives and role-modeling by senior leadership are important elements of building inclusive cultures, organic bottom-up programs that engage and empower employees at all levels are critical to inclusion. Arrow Global, for example, has four employee network groups, covering LGBTQIA+, race and religion, neurodiversity, and age and gender. “These groups have dedicated budgets and executive sponsorship, allowing them to shape the agenda,” says Jan Wade, Arrow Global’s chief people officer.

At Apax Partners, Pavithra Mahesh is a principal in the healthcare team in New York and one of the co-founders of Apax RISE, a women’s network that originated organically and was formalized during covid. RISE was launched with the goals of increasing connectivity and engagement, enhancing development and retention of female talent, as well as raising awareness. “Our industry has historically struggled with gender balance and, though strides are being made, change naturally takes time,” says Mahesh. “We want to make sure women in different teams and roles at the firm do not feel isolated and can leverage RISE to get to know each other better and feel supported.”

When it comes to awareness, Mahesh adds that: “RISE is not exclusively female-orientated so we regularly host events to help all colleagues understand how the lived experiences of female professionals may be different. For example, every year for International Women’s Day we invite female C-suite executives from our portfolio companies to talk about their career paths, their leadership experiences, and any challenges they have faced. The event is always well attended by the whole firm.”

“If you are doing things that are not working, stop doing them and focus on things that are more effective”

Gurpreet Manku,
Level 20

3Mentor the leaders of tomorrow

Formal and informal mentoring have been a focus at Apax this year. “We have started off with a recurring breakfast series featuring a career discussion with an equity partner and are piloting a formal mentoring program,” says Mahesh. “We also think informal mentoring is extremely valuable, and some of the best relationships develop organically from working together. We encourage our younger colleagues to take initiative and reach out.”

Level 20 runs a formal mentoring program focused on helping women in PE succeed and progress, with 125 firms providing mentors and more than 900 women so far having completed the program.

At Ardian, mentoring and sponsorship are also a key part of the focus on retention. HR manager Maxime Letissier says: “We want to make sure our junior women will be future leaders, and that is why we have developed our sponsorship program for women in the investment function, which includes coaching to help them build their leadership skills, their networks and their personal brands.”