Examining the Returns of 2021: The Financial Returns of Diverse Private Equity Firms

Diverse-owned private equity firms continue to outperform their benchmarks, according to “Examining the Returns 2021: The Financial Returns of Diverse Private Equity Firms,” a study released by the National Association of Investment Companies (NAIC). When combined with findings previously reported in NAIC’s 2019 and 2017 studies, these results confirm a long history of benchmark-beating performance by diverse investment managers.

Authored by Meredith Jones, Partner, Global Head of ESG for Aon, the biennial report is the industry’s only quantitative study measuring the performance of diverse-owned private equity firms against established benchmarks. The report illustrates diverse managers’ acumen in sourcing deals and executing their investment strategies, even during uncertain economic conditions. It is also a critical tool used in NAIC’s ongoing efforts to increase capital allocations to diverse-owned alternative investment firms, who continue to manage just 1.3 percent of the industry’s $69 trillion in assets.  This troubling statistic continues in the face of a growing number of conversations regarding diversity and inclusion within the industry and a history of outperformance by diverse firms. Still, many institutional investors continue to overlook these accomplished investment managers.

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