Flexible working was not fashionable in private equity before 2020. Only 7 percent of private markets professionals regularly worked from home, said a survey of 311 of them by eVestment and MJ Hudson. Of those, 80 percent were senior team members. Junior staff were absent from the group. “Working from home is a privilege to be earned, rather than a right, it would seem,” noted the report’s authors.
The report – on work-life balance in PE – landed in the Side Letter inbox soon before the world was turned upside down by covid-19. Pandemic-related events shunted it to the bottom of the news pile. Now, as most PE professionals have come to terms with their newfound privilege of working from home, the report merits another visit.
There is much that won’t surprise: 9 percent of respondents typically spend more than 58 hours a week in the office. Thirteen percent described work as one of their “key evening activities”, thankfully behind spending time with the family (50 percent), exercising (27 percent) or watching TV (32 percent). Only 2 percent said work was part of their typical weekend.
The data were gathered in a pre-pandemic world – there is a nostalgic section on commuting, for example – but the report is still worth the attention of leaders in private markets. For one thing, it highlights the risk to businesses of employee burnout or stress. It also proposes more flexible working practices to allow employees to engage more with their personal motivations, or “life.”
“It’s pretty simple: in their personal lives, respondents overwhelmingly (62 percent) said that their family or children were what motivates them most,” the report concludes. “It seems that simply allowing staff the flexibility to engage fully in family life will bring dividends.” It will be interesting to see whether this is embraced as and when the pandemic subsides.
- The three big professional motivators for private markets professionals are: money, career success and making successful investments. Those in leadership roles place less importance on money and career success (presumably because both have already been attained). Money is the biggest motivator among operations, admin and legal staff, as well as IR professionals.
- When asked about their responsibilities, none of the 80 limited partners surveyed identified theirs as delivering returns for stakeholders. Instead they described the tasks they complete day-to-day: fund selection, monitoring etc. “Why such a focus on the journey rather than the destination?” the authors ask. The answer, they suggest, could be a combination of remuneration (performance related pay is nothing compared to a GP’s carry) and the fact that, if an investment process is followed to the letter, then poor performance can be explained away by the market. “If they want their teams to care more about the ultimate performance of their investments, leaders at LPs need to make this measure a meaningful component of their remuneration,” the report notes.
- In terms of what they enjoy about their jobs, PE professionals’ top two choices were working with clients and working with colleagues; these are people-people. Having a positive impact, meanwhile, was cited by just 5 percent of respondents.
Check out the full report here.