Race in Private Equity and America’s C-Suite Diversity Problem

America’s moment of reckoning around systemic racism is seeping into the corporate setting.

Many high-profile CEOs have issued statements in support of racial equality and social justice, but they do so primarily as White individuals with predominately White teams. A McKinsey & Company analysis of 279 North America-focused companies found 87% of their C-suite executives were White. Meanwhile, just 3% were Black.

The lack of racial diversity pervades many of America’s more highly-compensated jobs. White Americans make up 68% of the U.S. population yet represent over 90% of non-clerical and non-laborer workers within financial firms. This underrepresentation seems to be especially prevalent inside private equity.

While anecdotal evidence regarding the lack of Black PE professionals abounds, there is a lack of comprehensive research on the subject. However, the data that does exist along with the traditional PE pipeline and the inherent culture of private equity allow us to make educated assumptions.

A 2019 analysis from the Knight Foundation found just 3.8% of all U.S. private equity firms had minority ownership (ownership defined as holding at least 50% of the fi...