This week saw the publication of the diversity and inclusion survey report produced by the British Venture Capital and Private Equity Association (BVCA) and Level 20. 

This report marked the first and very pivotal step towards understanding ethnicity data across the industry, and establishing a baseline on which future reporting and progress can be measured. 

The report shows VC and PE firms are making steps with gender diversity but the industry is significantly lagging on ethnic minority representation: 

  • combining gender and ethnicity reveals that women from ethnically diverse backgrounds represent only nine per cent of the report’s sample; 
  • in senior roles just three per cent of employees were women from ethnically diverse backgrounds. Black women accounted for less than one per cent of senior roles whilst Asian women were only 1.6 per cent. 

The data shows some encouraging trends towards better inclusivity for females within the VC and private equity sector:

  •  the number of women working in investment roles across senior (10 per cent), mid (20 per cent) and junior levels (33 per cent) is improving, in small, mid and mega sized funds (based on Assets Under Management); and
  • all male investment teams have declined from 28 per cent in 2018 to 12 per cent.  

However, the number of senior women working in investment roles remains consistently low at only 10%. This mirrors the challenge for firms to retain and support the transition of women to more senior roles.

One of the reports key recommendations is the regular collecting and analysis of data on diversity and participating in industry-wide surveys. This is also reflects the recommendation in the Rose Review update 2021 which focused on the importance of highlighting where measures within the industry were working and where further measures may be needed. 

An example of such reporting is the Future Fund (launched in May 2020 to support businesses affected by Covid-19), it publishes regular data (via the British Business Bank) on the gender and ethnicity of senior management receiving support and on the regional spread of its investments. 

Additionally the Future Fund signed the Investing in Women Code upon its inception and has played a key role in increasing VC signatories to the code. HM Treasury also intends to publish the first annual Investing in Women Code Report in the first quarter of 2021. 

Whilst data alone will not address the inequalities within the VC and PE industry, the data does establish a baseline holding the industry to account and will help us answer the question what gets measured, gets improved?