WORC Unveils New Research Report on Human Capital Management in Private Equity

CHICAGO, IL - The Workforce & Organizational Research Center (WORC) has released a new study, titled "Thinking Beyond the C-Suite Pays Off - Well, At Least Sometimes: Human Capital Management in Large Private Equity Value Creation." This research, funded by the Ford Foundation Mission Investments, delves into the role of human capital management in enhancing the value of large private equity firms.

The study drew insights from interviews with stakeholders from seven prominent private equity firms, including the BlackRock Impact Opportunities Fund and TPG. It highlights how focusing on the C-suite is predominant in value creation strategies until the realization that lower-level workers also hold significant importance. The research indicates a paradigm where large private equity entities invest in the broader workforce, especially when these roles are crucial in implementing a deal’s value creation strategy.

Despite past emphasis on C-suite management, this study suggests a notable shift towards valuing roles at all levels within companies. It presents a scenario where enhancing lower-tier positions can lead to benefits not just for investors but also for companies and their employees, fostering a more satisfying work environment and healthier communities.

Ellen G. Frank-Miller, Ph.D., founder and CEO of WORC, emphasized the importance of recognizing the potential benefits of prioritizing lower-level employees as key drivers of value rather than viewing them merely as costs. This approach aligns with the concept of ‘Patriotic Capitalism’ and is supported by positive financial returns observed in firms adopting such strategies.