Public perceptions
LP opinions are split on whether private equity has the reputation it deserves among the wider public.
As private equity – and the private markets asset class more generally – reaches further into economies globally and as GPs increasingly seek to raise capital from individual investors, the industry’s wider reputation is becoming more critical to its success.
Encouragingly, nearly half of LPs (47%) believe private equity’s public reputation is about where it should be. However, at 39%, the proportion who say it is worse than it deserves remains high, with North American respondents most likely to say this (at 49%). Compared with previous results, little has changed since 2018, although we observe a slight improvement on 2016, when 44% said the industry’s reputation was worse than it deserved.
On balance, LPs believe that focusing on private equity’s economic benefits would improve its reputation. About a third (34%) say that a better understanding among the public of private equity’s contribution to economic growth would enhance perception, with 30% saying the same about job creation.
APAC respondents have a different perspective: for these LPs, pension fund performance is the most important aspect for the public to understand (36% say this, versus 20% overall). This may reflect the fact that many pension funds in the region are relative newcomers to private markets and that many APAC economies are growing faster than those elsewhere.
