NEWS AND INSIGHTS UPDATE:
A study by the National Association of Investment Companies (NAIC) found that the funds managed by its member firms (79% of which are owned by minorities and 69% of which have women or minorities in at least half of the investment roles) had a median net internal rate of return of 15% from 1998-2011. That’s significantly higher than the 3.7% rate of return for the U.S. private-equity industry during the same time period.
Devin Banerjee shares the following additional information from the NAIC report with Bloomberg:
“At nine of those 10 biggest private-equity firms industrywide, women account for an average 8.1% of managing directors and senior executives, the highest-ranking and best-paying jobs, according to data compiled by Bloomberg from the companies and their websites. The comparable figure for the country’s six biggest investment and commercial banks is 30%. Women make up 13% of the senior ranks at 10 of the largest traditional-asset managers.
“A report published in August by the Credit Suisse Research Institute found that companies with women on their boards rewarded shareholders with corporate performance and share-price returns that are more stable than those at comparable companies with all-male boards. Net income growth at companies with female board representation averaged 14% over the past six years, compared with 10% at those without a female director, according to the study.”
NAIC hopes that the report will serve as a call to action to investors and motivate them to do business with firms that embrace diversity.
Get the details: Minority-Owned Private-Equity Firms Beat Buyout Titans in Study via www.bloomberg.com