A controversial paper published earlier this year by consultant Nori Gerardo Lietz, “Cloistered in the Pink Ghetto: Women in Private Equity, Real Estate and Venture Capital,” sparked debate in the US over the lack of women professionals and overall diversity in the industry. Now, that debate has come to Europe.
Emily Bohill, founding partner at London-based headhunter Bohill Partners, said she has researched the issue of diversity and, from conversations with chief executives in the private equity real estate industry across Europe, it is clear the goal is “on their agenda” and “aspirational.” However, she added: “You do wonder sometimes whether this is largely for public perception. One CEO told us he would have loved to have hired a woman for a chief investment officer role, but that person just did not exist with the pre-requisite skills. We challenged him because we knew several women with the right expertise, as we track the highest-performing female real estate professionals through our ‘Women to Watch’ programme.”
Having recently polled CEOs and other senior clients, Bohill found that some European firms have gone farther than others in addressing a perceived imbalance. Pierre Vaquier, chief executive of AXA Real Estate Investment Managers, noted that his firm has a comprehensive diversity and inclusion strategy. “One of our priorities is to increase gender balance, particularly at senior levels,” he said. “To this end, we have set a goal to have at least one female in the pool of candidates for all vacancies. This approach has resulted in the appointment of a number of women to key senior roles over the past two years, both from within the organisation and from the external market. I am particularly pleased that 40 percent of our management board is comprised of women.”
Vaquier added: “While I am not an advocate of gender quotas, I do believe in setting targets. If we truly want to see our industry evolve, organisational leaders and educational institutions must make a concerted effort to address the barriers and biases that are limiting the participation of women in our industry.”
Bohill’s research shows CEOs generally felt women were better at raising ‘difficult issues’ in business and forcing them to be dealt with in a ‘non-aggressive manner’. Other ‘pull factors’ included the fact that women tend to value loyalty highly and change companies less, which is helpful for investors looking for stability in the funds they are investing in. Other areas where women tend to excel include networking and building long-term relationships.
The research also highlighted a feeling that being a public property company instead of a private one could affect how a firm approached the issue of diversity. After all, a recent UK government report, “Women on Boards,” proposed that FTSE 350 boards should aim for a minimum of 25 percent female representation by 2015. Since the report was published one year ago, the largest-ever annual increase in the percentage of women on boards has been seen. In fact, if the present momentum is maintained, the report’s proposed target will be exceeded over the next three to four years.
Laure Duhot, a former female founding partner of Macquarie Capital Partners and now director of strategic capital markets at public property company Grainger, said the more transparent listed sector – with its closer scrutiny of operational policies and management by external investors – might lend itself more naturally to good diversity practices than more opaque limited partnerships in private real estate. “I would say the current situation in the real estate industry is not a matter of deliberate gender discrimination, it’s just the result of companies taking the ‘easy route’ in filling their non-executive management positions,” she added.
However, Eric Adler, managing director and chief executive of Pramerica Europe, noted that his firm is developing some industry-leading female talent, including the head of its flagship real estate fund in the US and its country head in Mexico. “Bringing together a leadership group that reflects different backgrounds, styles, perspectives and opinions can make the decision-making process more challenging for a company,” he acknowledged. “However, it is that very process of working together to understand the different viewpoints that can lead to good decisions for our company, our partners and our investors.”
Lynn Thurber, one of the most-senior women in private equity real estate and the non-executive chairman of LaSalle Investment Management, said: “In almost every senior role in the real estate industry, management, leadership, strategic thinking, negotiation, presentation skills and a substantial set of relationships with clients and/or sources of investment transactions are essential. Companies and female professionals would benefit significantly by identifying both formal and informal programmes to develop and enhance these areas.”
Thurber’s solution involves a change in training and mentoring. “All managers should be charged with the responsibility of ensuring their reports receive training and coaching in these areas. Male supervisors typically find it more natural to provide feedback and mentoring to male personnel. Senior management should recognise this and make a concerted effort to ensure female professionals are receiving the same level of constructive feedback and variety of opportunities for career growth and expansion of skills that their male counterparts receive.”