Women in private equity: "Not enough to be competent, you have to be beautiful"
Private equity, like much of the buy-side, is not known for the diversity of its employees. A study last year by Columbia Business School found that only 22% of people in investment roles at top US private equity firms are women, down from the 23% identified by McKinsey in 2023. Most of those women are in junior jobs. Many don't stay. A new study helps explain why.
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Camilla Høiby, a student at Copenhagen Business School, interviewed 17 people at private equity firms in Western Europe in an effort to unearth the "lived experiences" of women in private equity (PE) for her masters thesis. Those experiences were not the best.
"PE can be quite toxic at times and there’s really high expectations," one woman in the industry told Høiby. Another said the private equity industry is full of "men from similar backgrounds, making all the decisions." Another said that if you're a woman trying to "make it" in PE, "it's not enough to be competent, you need to be beautiful." There's "a lot of sexism."
The comments help explain why it is that McKinsey found that women in private equity join and then leave again. In 2023, it said they accounted for 33% of associate investment roles, for 25% of vice president roles, 15% of principal roles and only around 13% of MDs.
The male majority is in evidence at major firms like Apollo Global Management. Of seventeen senior people listed on Apollo's site, only five are women. More tellingly, though, only one of those women is in an investment role - Olivia Wassenaar, a partner in sustainability and infrastructure investing. Wassenaar (pictured) has a stereotypical PE background including a Harvard degree and a Wharton MBA.
Høiby also found, however, that men in private equity quite like having women around. Not just because they're often beautiful, but because they can be a catalyst for improved working conditions. "I think that women have higher standards of work life balance," said one man. They work shorter days, they expect longer vacations. Men's working lives improve as a result, he added.
Women won't stay in PE, though, unless they can see other women getting promoted. “Women don’t want to be the only woman working at a PE firm," said one of Høiby's interviewees, saying that she tries to make herself visible for this reason. "I noticed that after I started at my firm, we started receiving more female applicants."
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