Now is a great time for Women to join the PE industry

The Flying European Women of Private Equity

Interview with Dörte Höppner, COO of Riverside Europe

The LPEA met with Dörte Höppner to discuss one of Private Equity’s (PE) main challenges today: the need for more women in senior roles. Rajaa Mekouar-Schneider, CEO of LPEA and Olivier Coekelbergs, Vice-President of LPEA, discussed with Höppner about her career and her commitment in pushing for more women to join the asset class.

There is a positive correlation between gender diversity in teams and returns achieved

Tell us about the key moments in your career and how you entered the PE industry

After my career as a TV journalist, I worked at the German Institute for Economic Research as Head of Comms back in 2007. A keynote speaker at one of our events was Thomas Pütter from Allianz Capital, who chaired the German private equity association. I asked him why Private Equity as an industry was doing such a poor job at explaining itself to the wider public. A week later he called me and offered me the role of Managing Director at the Association to help improve the image of the industry. This was one of the key moments in my career.

I never sat down to plan my career methodically, but I was always open to new opportunities that presented itself. Not at evening networking events, which I always tried to avoid, but by staying open minded everywhere I am. Also, I was lucky to always have a boss or mentor who supported me to grow and develop. In my case it was always a man, which is not surprising given the few women in senior roles.

Also, as a mother of three, I found it was important to have the right partner at home who supports you, together with a strong social network of family & friends. After our second son was born, I initially stayed at home for a year or so before resuming work. Once I was back to work my husband, who also has a demanding job, was always there to share the household tasks and the kids’ education. Combining children and work will look different for every young mother. There is no single role model. But it is doable, ultimately it is an organizational challenge.

The later part of my career, since 2007, has been spent within the PE industry and has always involved a great deal of travel. For example, during my tenure as CEO of Invest Europe, I was working out of Brussels, but I did not relocate my family and was commuting Monday-Friday every week. This certainly required me to have a good support system around me, but with all my travelling it was the best option for my family to stay in Berlin.

I think PE is a fascinating industry, led by people who are swift in their processes and decisions, compared with other sectors. Working within such an industry has been a big reward for me. After completing my mandate as CEO of Invest Europe, I was keen to stay in PE and Karsten Langer, a former chairman of Invest Europe, offered me a role working with him again, this time at his PE firm, Riverside Europe, as COO. I have now been with the firm for two years and love being on the inside of our industry as a GP.

Nowadays, some of the largest companies are imposing quotas for gender diversity in their management functions. Do you think it is a good idea and should PE Firms try to follow suit?

I do not think that imposing quotas is the solution. However, I believe that PE firms need to have a strategy on diversity with specific targets. Those targets will differ for each firm, depending on its size and the market segment it operates in. Some firms and advisory companies are already designing strategies around diversity in their organizations and more specifically in their management functions. This seems to be a very sensible approach. In my view, a proper strategy should include a number of key pillars, including: i) the recruitment and the retention of talented women at various level of the firm; ii) the design of dedicated programs or initiatives aimed at strengthening retention; iii) the development of inclusive coaching and developmental programmes designed for a diverse base and not just for men; and iv) processes supporting fairness for all employees when it comes to compensation and promotion.

You are a very active member of Level 20, an organization aiming at promoting women in PE. Could you tell us a bit more about Level 20?

Level 20 is a not-for-profit organization which was founded in 2015 to inspire more women to join and to succeed in the PE industry. In 2015, according to Invest Europe, women occupied only around 5% of senior roles in the European industry. Level 20’s aim is therefore to increase the percentage of senior women in the industry to 20%. Level 20 is now supported by 46 major PE firms, which shows the growing goodwill and desire to promote gender diversity in our industry.

Level 20 has designed mentoring programs to enable women working in the industry to benefit from the lessons learned and insights of those with more experience. It is important to note that the mentors are also men – gender really does not matter here. Level 20 hosts a variety of events to support its objectives. These vary from large member networking sessions through to smaller, more targeted events, often with an educational component, for a select group of members. The Level 20 Outreach Program aims to encourage young women to consider careers in PE.

Why do you and Level 20 consider gender diversity in PE team to be driver of success for PE Firms?

For the simple reason that diversity in views has a positive impact on the performance. Diverse teams have a stronger ability to understand the challenges presented by a specific opportunity and to deal with these efficiently and effectively. In the PE industry, a great deal of time is spent identifying high-potential opportunities for value creation. Clearly, diverse teams are better equipped to make better decisions. This view is not only the view of Level 20; many studies have demonstrated that there is a positive correlation between gender diversity in teams and returns achieved.

What could the industry do to attract more women?

Reaching out to them! Discuss and see whether a career in a PE firm might be a first opportunity for them or as a next career step. Overall the goal should be to have a critical mass of women, which in turn will attract more women to the asset class, because they will say, “Wow this must be a good place to work if there are so many women”. More women will want to join if they feel that they can be part of a diverse team.

Also, on the remuneration side, Carried Interest is something that can be structured in a way that takes into account the fact that someone may take a career break. This should of course be completely independent from whether the individual is a man or a woman because a male team member can also take a career break for family reasons or to sail the world or whatever. Compensation obviously is important and the Carry structure is important for the industry. It should be part of the strategy to help achieve more diversity within the firms.

What´s next to promote women in PE

At Invest Europe, almost half of the Board members are women, which is great and shows the willingness of women to engage in causes they believe in, beyond the business itself.

To me, this also shows that it is possible to have more gender parity at all levels.

Another great way to promote women in PE is to strive for a 50/50 ratio between men and women in panels at all events. This way female representation is ensured and it speaks for itself; this is much more important than organizing female-only events.

During my tenure as CEO of Invest Europe, I encouraged and supported initiatives like Level 20, while allowing them to remain independent from Invest Europe, the association. This is the way forward.

I look forward to participating in future LPEA events, as a GP member of the Association.

A few words for Luxembourg?

Luxembourg has clearly become increasingly important for the PE industry in Europe and beyond. In light of regulatory, tax and other political evolutions such as Brexit, Luxembourg has managed to offer an appropriate and stable environment to PE Firms to structure funds, operations and transactions. Investors are also familiar and comfortable with the local environment. In the industry, we see more and more PE firms and investors putting Luxembourg as one of their key hubs to operate.

Dörte Höppner – Biographie

Chief Operating Officer, Riverside Europe & Director, Fundraising and Investor Relations

Ms. Dörte Höppner joined Riverside in 2017, bringing extensive experience in European private equity. She serves a multifaceted role, leading Riverside’s initiatives in Europe and working closely with the Global Talent Management and Fundraising & Investor Relations teams. Ms. Höppner came to Riverside from P+P, a leading German law firm. Prior to that, Ms. Höppner was Chief Executive and Secretary General at Invest Europe and Managing Director at the German Private Equity and Venture Capital Association. Ms. Höppner began her career in financial journalism and communications. She earned her diploma in economics from the Freie Universität Berlin. Ms. Höppner has been recognized by a number of trade publications for her contributions to private equity, among them Most Influential Person in European PE and Best PE Personality of the Year.

RIVERSIDE
• Strategy: Riverside’s unwavering focus on the smaller end of the middle market has led to a buy-and-build investment strategy that seeks to maximize potential for companies.
• Riverside manages 6 funds in Europe
• Sector / stage focus: Control buyouts of European companies with less than €25 million in LTM EBITDA.
• AuM: Over $8.9 billion in assets under management, as of Q2 2019
• Office Locations: Brussels, Stockholm, London, Madrid, Luxembourg, Munich / 9 offices in the US and Asia-Pacific

PE compensation packages have to be tailor-made so whether a male or female has a specific need in his or her career, it can be taken into account. It should not be a hurdle at all for women to access senior positions in the firms