The opinion that global investors hold of partners and portfolio managers in private equity is broadly negative, according to Gracechurch Consulting’s 2013 Global Private Equity Performance and Reputation Report.
Global investors see PE as offering a better risk / reward proposition than other asset classes, while private equity is also seen as delivering a greater degree of operational improvement than listed companies.
The research was last conducted in 2010, and is the only international syndicated study into reputation in the sector. Interviews were conducted with investors who are responsible for making decisions or have influence with respect to investment into private equity, and took place across multiple regions.
“While investors believe that the PE industry adds value to the economy as a whole, their opinion of participants within it is less positive,” says Ben Bolton, chief executive of Gracechurch. “In the last two years, there has been a decline in ratings given by respondents for the calibre of partners and portfolio managers within PE. The key issues driving this negativity centre on the perceived lack of integrity around the deal process and a lack of alignment around the objectives of the deal.
“The fact that PE scores less well in terms of Net Promoter Scores than other industries such as law or insurance, illustrates that many firms are simply not getting their messages across to investors. However, there are strong performers whose scores show that some are getting it right in this area.”
