Should PE Pros Be More Accountable For Mistakes? LPs say “Yes!”
When a corporation makes mistakes, the CEO resigns. When a PE firm makes mistakes, it cans portfolio company management. With all this talk of a PE firm shakeout, will the heads of firms resign? It doesn't seem likely. In fact, I am not sure that has ever happened in the history of private equity. The keyman provision and ten-year tie-up period make PE heads accountable in different ways than managers of public companies. When a firm messes up royally, the top dogs stick around. Yet today we saw the head of one of the largest PE firms in the world resign. Philip Yea, CEO of 3i, stepped down after news that the company's investments plunged 21%. The difference here, of course, is that 3i is a public company.
28 January 2009•2 mins read
