TOTO: Levelling up

Speaker A: Foreign.

Speaker B: Hello, and welcome to Top of the Ops, a, uh, podcast brought to you by the Drawdown. Uh, each episode we take a look at private markets, but from a slightly different angle. So rather than be distracted by the latest deals done. We examine the nuts and bolts of the market, its intrinsic architecture, to reveal how private markets firms really operate. My name is John Whittaker. I'm the editor of the Drawdown and, um, host for this episode where we'll be looking at gender diversity and in particular the role of family leave in reducing gender bias within the industry and, um, in attracting and retaining talent. To help me untangle this knotty topic, I'm joined once again by Tanya Kushal and Matthias Plotz, reporter and deputy editor at the Drawdown, respectively. Hello. How are you both doing?

Speaker C: Well, I'm a little bit surprised we don't have any nicknames, uh, today.

Speaker D: Yeah, I was going to say no obscure nicknames today. John, are you okay? Is everything all right at home?

Speaker B: Well, what can I say? It's 2026 new year, new Me. Uh, they might return next episode. We'll see. Uh, anyway, we have limited time, so let's turn to today's topic, uh, which broaches gender diversity in private markets. Uh, Tanya, you've been looking into this actually recently, haven't you, for an article you've been working on. And look, the research suggests that we are still, uh, very far from seeing a level playing field across the industry. Right?

Speaker C: Yes, that's exactly right. And the story I'm working on looks at hostility and discrimination more broadly, not just from a gender lens, because gender often intersects with other areas. Uh, and the main, uh, lead to the story was that there's a stack of discrimination lawsuits against private equity firms that are still alive.

Speaker B: Yes. Um, yeah. And that concerns about inclusion go far beyond, um, the industry that we're concerned with. Of course. Um, uh, my, uh, interest was piqued by a McKinsey report, um, which came out, I think, in December at the end of last year, uh, examining women in corporate America, uh, or, um, the representation of women in corporate America, um, more broadly. And it made for pretty sober reading. Um, though the largest U.S. firms have modestly increased the proportion of senior roles held by women, um, this report picked up that there's a clear trend of scaling back, uh, diversity and inclusion programs and a reduction in flexible working allowances, uh, that tend to, as we know, disproportionately benefit women.

Speaker D: Ah, such a stark contrast. So, one of my best red cover features for 2024 was a piece that I called Ecosystemic, um, about diversity and inclusion in private markets, specifically, sort of looking at how firms from an operations perspective, what frameworks they've come up with, what strategies they've come up with to create an inclusive environment which then should naturally foster diversity. And at the time when I was researching that, my sources said that US LPs asked way more questions about DEI and collected more data points within sort of the individual questions. When you compare them to European LPs, they ask for things like veteran status and disabilities, Whereas for European LPs, as one source put it, diversity sort of stops at white women. And it's only been a year and a half since that cover feature came out. And that small part of it, compared to the McKinsey report you mentioned, reads like a totally different world.

Speaker B: We're going to turn our attention to the main focus of today's um, podcast, which is looking at uh, the role of family leave within private markets, um, specifically as uh, part of this wider ah, uh, conversation. And to that end we've invited Gurpree Manku, uh, to talk to us. She's the CEO of Level 20, which champions gender diversity in private markets, um, and it has recently published a number of reports looking at the impact of family leave policies, uh, across the private markets industry. So let's hear from her now. I'm delighted to welcome Gurpreet Manku to the podcast. She is the CEO of Level 20, a uh, not for profit organization focused on improving gender diversity in private equity and venture capital. Gurpreet began her career at Deloitte before spending a decade at the recently renamed uh, BBCA. And she became level 20 CEO uh, in 2023. Gurfreet, thank you for joining me.

Speaker A: Thank you for having me. It's great to be here.

Speaker B: Pleasure. Right, so Level 20 published a pan European report on family leave in private equity in 2024 and then you followed that up last year with some country by country analysis. Why did you want to research this topic in so much detail?

Speaker A: So family leave was a topic that kept coming up in our conversations with members with firms in the industry and it kept coming through in other research we were doing specifically around the role of family leave when it comes to attracting and retaining talent. And a key finding in our work was that when you enable parents to take time out of the business and come back into private equity, which is typically a highly, uh, paced, high intensity, uh, environment and if you help them get back into the deal flow and into that environment in a supportive way, uh, that will help with the retention of talent. So we published this research to give our members and the industry data to assist with their conversations and help guide them with their policy development. And um, the report set out information on leave offered, leave taken and also some of the other support options out there. Now our work has expanded as you said, because there's been demand to do more country specific ah, work but also to share experiences and insights both from individuals but also at a firm level. So now we have this complementary set of reports, guides, um, interviews, um, articles and also events.

Speaker B: So I guess the suggestion there is that um, the level of um, knowledge, transparency and understanding about what other firms are offering in the industry has not always been there. And so actually part of the job you're trying to fill in there is actually raise awareness of where these policies have been really effective and share some of those stories, right?

Speaker A: Yeah, absolutely. Um, just being able to understand what um, other firms in your aum binding other firms in the market are doing is also helpful not just for the firms themselves, but for the people that work there. And as you know, our work covered m maternity leave, paternity leave and shared parental leave. And what we did was not just publish the data, but publish all the insights we had received through our feedback, whether it was through focus groups, structured interviews and also all our cumulative research that we'd done today. So I think the hardest part was being able to just encapsulate that and summarize that. But there was definitely a thirst for further feedback on what the market was doing because it is and has been an evolving area.

Speaker B: Yeah. And as you kind of highlighted, the findings of your research suggest that um, family policies have quite an effective defensive strategy for staff retention. Right. Um, but do you think that the leadership of PE firms um, should make more of an effort to accurately weigh the costs of these policies against the costs of replacing talent? Because that's where people's minds go straight away when you talk about these things is that the upfront costs of implementing them. Right.

Speaker A: So my view is that firms um, do already view costs through the lens of organizational resilience and retention of talent as people are ah, a crucial part of our business. This is a people, people driven business. Firms work really hard to bring talent in. They're incredibly competitive, um, as an. And I know they've been um, investing in their approach to talent management and family leave and we could see that in our data. So 84% of the firms that we surveyed and There were about 120 firms surveyed had either recently reviewed or in the process of reviewing their policies. When it came to family leave, when you think about costs, 80% of the firms offered enhanced maternity pay and 74% of them offered enhanced paternity leave. And given the number of European firms in our data set we also saw that a third of firms equalize um, paternity leave with maternity leave and that's at the enhanced level. So from a cost perspective my view is that firms have already been thinking about it um, against some of the benefits that having um, uh, a more inclusive culture has.

Speaker B: Yeah, um, and it's interesting you say that about the offering um, that um, ultimate enhanced kind of package where you've equalized between uh, paternity and maternity because I guess there's offering it and then there's having a culture within firms where people actually take it up. Right. And m, my perception is that actually the take up rate is still relatively limited for those kind of extended uh, packages. And obviously this isn't just um, related to this industry. So I think the latest UK statistics show just 5% of eligible men used um, uh, the government's official shared parental uh, leave scheme. Right. Um, and you argue that normalizing paternity leave is key to creating the inclusive culture. But how much can private markets firms do themselves to increase the take up by men when more broadly there's challenges in winning that argument?

Speaker A: So I think this situation is evolving, I think it's moving. Our research showed firms had increased the overall offer when it came to paternity leave and a third of firms had equalized paternity leave, um, with maternity. So the question is around take up. Now we knew a lot of men were interested in um, the topic as well because level 20 is an open network and we know based on the feedback that we've received since the report was published nearly two years ago that men have also been using it in their discussions. And when we speak to firms we hear that more men at junior and mid level are also starting to take up uh, the leave, uh, from paternity leave and shared parental leave. So you might see some changes um, in those numbers next time we publish this report. One firm said to me that they were encouraging the men in their team to take leave. So when the first woman had a child they just passed practice and precedent. So it wasn't a big deal, which I thought was quite nice. What level 20 can do is share ah, data but we can also share feedback from people around their own experience. And we've been quite um, keen to showcase uh, Examples of senior men, so that's an MD or partner level, talking about their experiences taking patent or shared parental leave, talking about how it impacted their career. You've got examples where people were promoted once, once they got back from leave, but. But mostly it was just about how they do it. So I think just increasing visibility on how parents are jug, um, their family responsibilities with their work responsibilities, how their firms have supported them is really. Is really helpful because like I said, I think this is an evolving picture. You note, it's not just unique to our industry. And what we can do is just give that forum for parents to talk about how they're managing it. In our events. We've been running through our event series. Sorry, we've been running parental coffee clubs on Friday mornings, which has been really popular. And that's not just for um, the core private equity industry. We involve some of our associate members, law firm, um, um, partners and so forth. And it's just a nice opportunity for people to get together and share tips with each other, whether it's around childcare providers and other suggestions. What's also uh, coming through in the discussions that we're having is that this isn't just about children because we're that generation who have elderly parents now as well. And that is starting to come through into conversation. We um, are busy people. We care about our uh, careers. We're quite committed to the work that we do. So question is about how do you manage periods of leave? It could be to look after children, it could be to look after other relatives and then get back into the workplace afterwards. So it's an ongoing conversation and I expect to see movement on it in future years.

Speaker B: Yeah, it's really interesting speaking to you around this because I guess you look at kind of wider, uh, um, uh, reporting around kind of um, D&I, um, uh, issues from a global perspective. And obviously you can't avoid, um, the levels of pushback, uh, and animosity towards those types of things that you see, particularly in the U.S. um, and you can get in a position where you worry about how much that changes the discourse at a global level. But it seems like from your experience speaking to people within the industry, that you're still seeing progression in this. You're not seeing a regression at all. And firms are still committed to uh, being um, um. A greater number of firms looking to enhance their packages and hopefully a greater number of individuals being interested in taking up those opportunities as well.

Speaker A: We're definitely hearing that through our conversations. And when we look back at the Pan European report. Most of the data actually came from firms that were headquartered in the UK or headquartered in the rest of Europe. And there what was really interesting was um, the level of maternity leave offered was fairly consistent. But like we were saying that the parental, the paternity leave, sorry offering was typically more for those European headquartered firms. Um, when you look at um, the data set actually so many of the firms had offices throughout the world, uh, and around 40% of them were developing their family leave policies with local country input. So those perceptions of fairness across offices are taken into account. Um, but when it comes to country specific dynamics, I think that's why we've been investing um, in further work in country because it's also social norms and market practices that uh, come into play. I think this is an ongoing conversation. Right. The picture is evolving. So what's really helpful for forums, ah, like level 20 is to bring people together. So we'll have the data analysis. But what's often more helpful is the conversation around how people are approaching it. Um, there's quite a lot of variability but there's also a lot of commonality.

Speaker B: Yeah.

Speaker A: Um, and I can't sit here and say to you these types of firms do this thing and this type of firm approaches it this way because in practice um, it's quite, quite broad and it's often dependent on the individual as well.

Speaker B: Yeah. So yeah, it's a mixed picture but essentially you're saying you're positive about kind of the direction of travel, um, uh, and what you're reading uh, from the data. One thing before we move on to the final question. I just intrigued about um, those uh, parent sessions. Parent coffee mornings. That's not parent and baby coffee mornings.

Speaker A: Babies are welcome as well.

Speaker B: Okay. I was just checking. Yeah, yeah. As an alternative to doing kind of baby yoga or something, you could come

Speaker A: to the level 20 every quarter. Um, the team will try and find a coffee spot on a Friday. It's usually from 10 so you can drop the older kids off first, uh, from ten. And um, it's just around London so where people typically live as opposed to central London. So um, those sessions are quite nice. Babies are definitely welcome. They do very well on social media.

Speaker B: Okay. Yeah, I bet, I bet. Okay, so uh, before we send you

Speaker A: an invite to the next.

Speaker B: No, please do. Yeah, I'll bring my daughter along. Yeah. Um, so um, kind of moving on to the final question. I had to you, I thought it was really interesting. You say it's a mixed picture. Right. So I think your research suggests that There's a gap between perception and reality when it comes to the typical family leave packages across the industry because you found that 46% believe their policies are the same as their competitors and yet there's actually huge variance right, in terms of what is actually offered. So, um, do you think, and obviously I imagine you will be supportive of this idea because that's what level 20 does. But do you recognize that there's more work to be done in terms of better comms on this issue and actually more of a role for firms who have embraced this to be more of champions of offering enhanced family packages and promoting the benefits that they derive from them.

Speaker A: Starting to see the promotion of, of um, the packages offered before anyway. But once the research was published accompanied by case studies, the interviews, um, we could see it was helping with the broader conversation because it was the first time such a broad data set had been published. Um, so firms probably didn't have access to that information before. They probably didn't really know or they might have had quite a small sample to figure out if they were in line with their peer group. And the feedback that I've been getting at uh, a firm level has been that this has been incredibly helpful to them. I've had people come to me and say that their firm has changed their policy, that is they've enhanced the policy further. Um, and you know, long may that continue. We will revise the European data set in a couple of years time but for now we're continuing to work on it at a country level and on the championing fund front, I think the interviews that we've been doing have been incredibly helpful because they're giving personal perspectives and at the end of the day that's what people want to hear. So how did she do it? She's a partner, she's got three kids. How did she do it? How does he do it? He, you know, he's the head of a, head of a region for his firm. Um, how does he juggle it with two, two sons? Um, and, and all our interviewees have been very honest, um, about how they've approached things. They've. And I think that's what they' um, um, what's been received so well by our network. Um, so we'll keep doing that. You know, we call it the Printing in PE series. But you know, other, other sectors are also, also welcome. I think just getting out more feedback helps, um, because sometimes you don't know what you could be doing or what you should be doing because as you can appreciate some of the firms in this industry are still quite small organizations.

Speaker B: Yeah.

Speaker A: Um, and even the very large ones are still relatively small compared to other bigger markets out there. So bigger companies out there rather. So I think just having more feedback, um, and um, people sharing their perspectives really helps.

Speaker B: Yeah. And it's, you know, here at the drawdown, um, we're very conscious of someone like a CFO quite often has to manage various different functions within um, uh, PE firms. Um, quite often the HR function as well. And so for them any kind of information being able to benchmark against other firms, as you say, similar aum, um, how people are dealing with this and hearing success stories is going to be really valuable to them as well.

Speaker A: I think the one data point that really helped this conversation certainly from my perspective, was we were for the first time able to quite clearly say that women in deal teams who'd gone on maternity leave were still with their firms three years later because there was a perception that women were having children leaving. And that wasn't true. That wasn't the case. And our data proved that. And I think just even having that data point out there was incredibly helpful because then it goes back to your point about investing in the processes, the coaching, taking the time out to do kit days properly. You know, thinking about you know, the whole period of leave and the return, return from leave as well. Um, and it is all um, it all seems to be going in the right direction.

Speaker B: Okay, well look, I think as you say your research will continue. It'd be brilliant to kind of circle back on this when the next time your um, report on this comes out and we can compare the data and hopefully as ah, you know you're, you seem to be sensing we will see Ferguson progress in this area. Um, and in the meantime I might see you at the next uh, uh, parenting coffee morning.

Speaker A: Yeah, that would be brilliant. Thank you.

Speaker B: Okay, well, yeah, thank you so much for coming on the podcast Gerpreet.

Speaker A: Thank you for having me.

Speaker B: Great to hear from Gerpreet there. Um, and I've got to say I was pleasantly surprised by the level of positivity in her responses. Um, and I guess there is that general fear that we're maybe going backwards slightly on some of these issues. So to hear that in the research that they've done things are moving in a ah, positive direction in terms of packages offered by uh, firms in Europe. Um, and also in terms of the take up rate and obviously they are trying to do a lot of, to support that and promote and advocate um, uh, for it it's probably the point in the podcast where I should confess that I have somewhat of a um, uh, maybe not vested interest but um, a bias here and that I took um, ah shared parental leave myself um, when my daughter was born. And I'm a huge advocate for it. I think from a selfish perspective, um, uh, found the experience you know, hugely educational and valuable and a wonderful uh, period um, of time that I spent with my daughter. But also I think it's an important thing for men to try and step up and do and you know, it's not just obviously it's not just for our benefit but to more normalize it ultimately is to the benefit of um, uh, to women, ah, in society as well.

Speaker C: Yeah, well my parents took uh, shared parental leave when I was born. Um, I mean they did have the advantage that they were both government employees. Um, and they of course get more benefits. Uh, but if I remember correctly during my high school time my mom took another round of like family leave or like parental leave again just to help me because I was like really stressed out and need help with my A levels. So she took some time off and uh, and she said she could do that until I was 18. And that's quite interesting that parents should be able to take care of their kids at every second point in their life, not just when they're born. And I think that's also another concept that firms should look into.

Speaker B: And Matthias, at um, one of our recent events, right. We were hearing similar arguments um, in a closed door session. Right.

Speaker D: Yeah, actually. So, um, the conversation just now reminded me of two points that was raised at the last um Operational Leaders Summit in Portugal last year. Uh, and one of them was when it comes to the broader discussion around talent and especially how you retain talent, there's obviously always a financial package conversation to be had around that. And particularly for the smaller firms there is often a worry that they simply cannot compete on compensation packages with larger firms that is just not on the table. Their pockets aren't that deep. Um, but the point was made that creating very strong policies or empowering policies for your employees around things like um, parental leave is one way of retaining staff in the long term. Um, and I thought another point that was made which I thought was very interesting was um, that having policies, and especially policies that in the past maybe have been there but haven't necessarily that the take up hasn't been great. Let's say for example parental leave, which I think historically parental uh, leave so for fathers, um, hasn't really the take up hasn't been great. So, so what they have done is they've actively encouraged the senior male staff members to whom the situation was applicable of course to go and take parental leave because that kind of ingrains it for one in a company culture, but also signals to everyone down the food chain that it is okay to take that leave. And for lack of better words, your career will still be there when you come back.

Speaker B: I think this is a conversation we can carry on for quite a while. Right. It's just going to be interesting to see how these um, uh, policies expand and evolve over time. And I think as Gurpreet suggested, they'll be doing their own research, um, repeating it in the next couple of years so we can uh, compare and contrast and see whether um, uh, her uh, expectations of things continue to improve, um, uh, are borne out by uh, the data. Right, so before we leave guys, it's your opportunity to have a little plug of um, articles that you're working on at the moment. So Tanya, can I ask you first just to give our listeners a little sneak peek into things that you're working on at the moment.

Speaker C: Of course. So kind of staying on topic, um, I am looking at hostility against um, women and anybody, uh, not male and not white, um, in uh, the private equity world and why is that still happening? So apart from that I am looking at also the European way of doing GP stakes. So that's another interesting one.

Speaker B: Great. Okay. Um, Matthias M. How about you?

Speaker D: Um, so I've been tasked uh, with writing the first sort of COVID feature of the year which is going to be looking at the question of what should or what could count as a fun cost. Um, and I'm really sinking my teeth into that right now. The other one that I've got coming up is I'm looking into the challenges and hopefully a couple of solutions, um, around running multi currency funds which you often use to broaden your appeal to multiple investors by making the investments available in different currencies. Um, and then I've also got a couple of entries in our ongoing profile series coming up. Um, and I think that's it for the moment.

Speaker B: Yeah, um, to catch up on all of that great content which is going to be coming uh, very soon. Make sure to check out the drawdown website. Uh, in the meantime it just leaves us to say thank you to all of you for listening, uh, thank you to Matthias, uh, and Tanya for helping me out.

Speaker C: Thank you very much.

Speaker D: Well, thank you for having me.

Speaker B: Yeah. And of course thank you for gurfreak for being our guest on this episode. Until next time, see you later.