Private equity investors are taking concrete steps to advance diversity, equity and inclusion, according to a report released Thursday by the Institutional Limited Partners Association.
The first report of a diversity initiative launched in December focuses on how signatories to the diversity initiative are approaching DEI metrics and data capture. ILPA polled limited partners and found a strong desire for standardization and expanded metrics.
The number of signatories to the diversity initiative has grown to 130 LPs, general partners and investment consultants, from the 50 founding signatories in December.
ILPA will publish quarterly updates of signatories and actions they have taken, as well as recommendation actions.
The industry response has been good, said ILPA CEO Steve Nelson. “Not only are the initiative signatories working to improve DEI through action, they’re also committed to sharing their successes and the lessons they’ve learned with one another. I’m confident that this information exchange will help accelerate our industry’s progress,” he said in a statement.
Two out of three signatories use ILPA's D&I team metrics template for reporting diversity metrics across 11 role categories, including gender and suggested race and ethnicity designations. An effort is underway to expand the template to more metrics, including: a non-binary/not disclosed option on gender, LGBTQ, veteran status, disability and age.
The most widely adopted optional activity focused on accountability, with 81% of signatories assigning senior-level DEI accountability, "aligned with an investment or senior management role," the report said. The least widely adopted optional activities related to talent pipeline and inclusive culture, with just 4 out of 10 signatories having diverse employee resource groups or incorporating DEI contributions in employee performance reviews.
Jen Choi, ILPA managing director of industry affairs and diversity in action initiative lead, said in the statement that ILPA officials are "thrilled to have such a large and committed group of industry stakeholders, and we are looking forward to seeing the progress they make over time in improving DEI in private equity."