Female board and leadership representation at European companies plunges whens private equity firms invest, according to a study by consultancy LCap Group.

The average percentage of women in leadership positions tumbles to 16% by the end of the private equity investment holding period, down from an average 20% before they invest, the study of 1,424 European companies showed.  

The drop in female representation was likely due to leadership teams and boards being expanded during the investment period and the majority of new hires being male, LCAP said in the report. The group found that only 8% of new C-suite executives brought in were female. More broadly, one in 50 chairs in the private equity industry are female, according to the group’s research, which found zero examples of female executive chairs.

“Because of unconscious bias, whether it’s affinity bias in which you tend to gravitate toward people who are like you, or just unconscious gender bias, men are more likely to appoint other men to positions than they are to appoint other women, unless there is someone there pointing it out,” Mary Ann Sieghart, founding partner of the Authority Gap Consultancy, said in a telephone interview. “I suspect in private equity there are fewer people to point it out.”

Read more at: https://www.bnnbloomberg.ca/investing/2024/10/15/female-leadership-suffers-when-private-equity-firms-invest/