Fixing The Private-Equity Gender Imbalance

Four ways to improve the industry’s diversity in emerging markets

By Dominik Treeck, Shruti Chandrasekhar, Heather Kipnis, and Alifia Doriwala
This article first appeared in Forbes Middle East on October 15, 2019.

Investors are wagering on a new era of prosperity in emerging markets. The bet is that a budding group of middle-class consumers will buy more goods and services from private businesses over time, and companies will ramp up production to meet the growing demand. The problem? Women aren’t playing a big enough role.

Roughly $850 billion poured into private equity and venture capital funds across Asia, Africa, the Middle East, and the Americas between 2008 and 2017. Yet women continue to be underrepresented, both in the management ranks of the companies being purchased and in the firms buying them.

According to a study by the International Finance Corporation (a member of the World Bank Group), Oliver Wyman, and RockCreek, the imbalance between male and female professionals in private-equity firms limits their ability to attract top talent, identify market opportunities, and improve returns. Gender balance sharpens firms’ investment decision-making, expands their deal-sourcing and talent pipelines, and improves their understanding of consumers.

In all, just 11 percent of senior investment professionals in emerging markets are women, similar to the 10 percent observed in developed markets. If you exclude China, the figure for emerging markets drops to 8 percent.

Gender imbalances also extend to portfolio companies. This is partly because many investment firms rely on their professional networks, which are often male-dominated. Researchers recently noted in the Harvard Business Review that male and female entrepreneurs are asked different questions by venture-capital funds. Many private-equity firms fail to use their considerable oversight powers to improve diversity inside their portfolio companies.

Private-equity firms can take the following measures to improve gender balance:


Establish a new tone at the very top for improving gender diversity. Few firms have strategies for achieving gender diversity, but it makes a big difference for those who do.


Establish and communicate long and short-term goals to demonstrate commitment. Some five to 10-year goals include improving the gender mix of hires to 50 percent, equalizing retention rates of women in investment roles, and equalizing promotion rates.


Firms can create an environment that doesn’t force tough choices between family and career. This gap can be closed by providing equal parental leave benefits, communicating support for parental leave breaks, and enabling managers to have better work-life balance upon return.


Male managers should look outside their professional networks by asking for connections from female investors, seeking out diverse candidates in recruitment activities, and requiring recruiting firms to provide a balanced mix of candidates. Firms can further improve their gender balance by looking externally at the portfolio companies in which they invest. To do that, they should: collect data and create portfolio-company targets to assess whether investors have any underlying biases; and change behavior through oversight, increasing diversity initiatives in portfolio companies.

Making it clear that gender balance is both necessary and advantageous sends a message to employees—and portfolio companies—that the vicious cycle of excluding women needs to be fixed.  

Dominik Treeck is a partner in Oliver Wyman’s Public Policy practice.
Shruti Chandrasekhar is the Head of SME Ventures at IFC.
Heather Kipnis is the global technical lead for women’s entrepreneurship at IFC.
Alifia Doriwala is a managing director and partner at the RockCreek Group.