Study: A Wide Gender Gap in Startup & Growth Company Leadership in Finland

The results of a recent study by KPMG and the Finnish Venture Capital Association show that there is a wide gender gap in the leadership of companies owned by venture capital and buyout (private equity) investors in Finland. The male-female ratio in the top management teams of private-equity-backed companies is similar to that of public companies, whereas the boards of private-equity-backed firms remain even more overwhelmingly male. The issue has been acknowledged in the Finnish private equity industry, and various initiatives have been launched to increase diversity both in the private equity industry and portfolio companies.

Gender diversity in the leadership of private equity (PE)-backed companies in Finland was now surveyed for the first time. When compared to listed companies, the gender gap in the top management teams of PE-backed companies is at the same level: women represent about 20% of both. In terms of representation of women on the boards of directors, PE-backed companies still lag behind: women hold only 13% of the board seats of PE-backed companies, whereas around a third of the board members of listed companies are women.

The study also examined the top management and board gender distribution of startups and more established growth companies separately. In venture-capital-backed startups, very few women occupy leadership positions: 15% in top management teams and 8% on boards. In more established, buyout-backed growth companies, the situation is better: women hold 24% of top management team positions and 14% of board seats.

“Startups are tech companies, and the technology industry is male-dominated. This trend is changing slowly but surely. For example, the Women in Tech network is constantly working to increase diversity in the industry,” comments Pia Santavirta, Managing Director of the Finnish Venture Capital Association (FVCA).

“Monitoring and increasing diversity is important for the entire private equity industry. Numerous studies show that diverse teams both produce better results and attract the best talent. Of course, providing equal opportunities for all professionals is also something that we, as an association and in the entire industry, work toward in many different ways,” Santavirta continues.

Aiming for Diversity Through Initiatives, Training, and Active Role Models

Private equity investors are often involved in recruiting key employees and forming the board of directors of their portfolio companies. Typically, a representative from the private equity firm is also a member of the portfolio company’s board, which means the diversity of PE teams can directly affect the diversity of portfolio companies.

“Private equity investors are constantly developing both the companies they own and their own operations. Much is already being done to increase the responsibility and impact of the industry. With this study, diversity has now been incorporated into the monitoring of the industry’s impact. PE-backed companies are a major employer in Finland, and they can have a meaningful role in promoting diversity,” says Kenneth Blomquist, Head of Private Equity at KPMG.

In addition to the work they do in their portfolio companies, PE investors also work towards increasing the diversity of their own teams. Many are involved in various diversity-related initiatives, such as Level 20, which aims to improve gender diversity in the European private equity industry.

“Level 20 is a project that aims to inspire and encourage women to join the private equity industry. We work towards our goal of a more diverse industry in many different ways: through mentoring, networking and events, as well as by conducting research,” says Pia Kåll, Managing Partner of CapMan Buyout.

“We need more female role models in the industry, as well as more women in sales-, business operations-, and strategy-related leadership positions. This can encourage the next generation of women to pursue careers in still male-dominated fields such as the tech industry or to become researcher-entrepreneurs or investors. My own principle is to help one woman move forward on her career path each week,” comments Inka Mero, founder of the deep tech fund Voima Ventures.

The Finnish Venture Capital Association also promotes workplace diversity through initiatives such as our ESG committee, a mentoring program, and a master’s thesis competition, which encourages students from different fields and backgrounds to learn more about the private equity industry.

The diversity study was conducted as a part of the annual private equity industry impact study. The study examined gender diversity in the top management and boards of Finnish private-equity-backed companies. The results are based on the 2019 gender distribution data, which was gathered from companies that received an initial investment from a Finnish private equity investor between 2017–2019.

In terms of diversity in top management, the sample comprised 198 companies, 63 of which were buyout-backed and 135 of which were venture capital (VC)-backed. In terms of board diversity, the sample comprised 234 companies, 70 of which were buyout-backed and 164 of which were VC-backed.

Additional information:

Finnish Venture Capital Association
Managing Director Pia Santavirta
+358 40 546 7749

Head of Private Equity Kenneth Blomquist
+ 358 40 752 0000

FVCA is the industry body and public policy advocate for the venture capital and private equity industry in Finland. As the voice of the Finnish VC and PE community and the entrepreneurs they fund, it is our role to demonstrate the positive impact of the industry on the Finnish economy. FVCA – Building growth.

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