Blackstone Casts a Wider Net in Diversity Push
October 22 2020 - 7:29AM
Dow Jones News
By Preeti Singh
Private-equity giant Blackstone Group Inc. is making a wider
push to increase diversity in portfolio companies and their boards
of directors with two new initiatives.
The first focuses on board-level representation, with a mandate
that a third of board seats at newly acquired U.S. and European
companies are filled by diverse candidates within a year after
Blackstone's acquisition of a controlling interest. New York-based
Blackstone defines diversity based on race, gender and sexual
orientation, where known.
The diverse directors would include those from company
management, from within Blackstone's ranks and among independent
directors, according to Joseph Baratta, Blackstone's senior
managing director and global head of private equity. Mr. Baratta is
also a member of the firm's management committee and has long
championed diversity. Earlier this year, Blackstone said it would
aim to diversify its own hiring by expanding the number of colleges
from which it recruits.
"We wanted to be very specific and intentional," Mr. Baratta
said of the new mandate, adding that the one-third representation
goal "was something we thought was realistic to accomplish now and
over time we'd like to drive it higher."
According to Mr. Baratta, Blackstone makes 25 to 30 control
investments annually across its private markets businesses, and in
recent years has focused on adding women to portfolio company
boards: Women filled half of the independent director seats it
controlled at portfolio companies last year.
"The new mandate would help cast the net to expand ethnic
diversity," Mr. Baratta said. The firm was already working with
executive search firms and forums that focus on diversity to
identify board candidates, he said. Blackstone began the effort on
a less formal basis several years ago.
The second initiative focuses on portfolio company staff all the
way down to entry-level jobs.
As part of the initiatives, Blackstone hired an experienced
executive, Marcus Felder, to spearhead strategic hiring initiatives
as a vice president in portfolio operations. Previously Mr. Felder
worked at the Posse Foundation, leading efforts focused on military
veterans, and has more than 15 years of experience developing and
executing strategies and programs to create access and opportunity
for diverse groups of people.
Among his initial duties, Mr. Felder will lead the pilot
program, called Career Pathways, to help expand traditional
entry-level applicant pools for portfolio companies.
Chosen for their large staffs, three Blackstone portfolio
companies will participate in the Career Pathways program,
partnering with two nonprofit organizations, Year Up and COOP
Careers. Both provide job training and recruiting from underserved
communities, and Mr. Baratta serves on the Year Up board.
The companies are Alight Solutions LLC, a benefits
administration provider in Illinois, Great Wolf Resorts Inc., an
operator of indoor water parks based in Wisconsin, and BME Group
Holdings BV, a European building materials company.
Year Up trains young people who have been derailed from a
regular career path. The group works with almost 5,000 people each
year on functional skills in areas like software coding and finance
and accounting, and in soft skills such as working within a
corporate setting.
COOP Careers recruits recent graduates from low-income
backgrounds who come out of urban public colleges and universities
to help them learn technical skills through apprentice-like
programs and to build contacts within the digital marketing and
data analytics industries.
At Year Up, Mr. Baratta said an opportunity gap exists for
high-quality student participants.
"These people are not in the ecosystems and patterns of regular
recruitment processes," Mr. Baratta said. "The new program is an
attempt to change those patterns to access different pools of very
high-quality talent that brings diverse backgrounds, diverse
opinions and will really make these companies better."
Ultimately, Mr. Felder's efforts and the pilot program are
expected to help portfolio companies recruit diverse candidates,
Mr. Baratta said. The efforts at inclusion will help drive results
at the companies, he said.
"This is meant to be like an organic development that becomes
part of their standard operating procedure over time and where they
appreciate that it benefits their businesses to have a diverse pool
of employees," Mr. Baratta said.
Write to Preeti Singh at preeti.singh@wsj.com
(END) Dow Jones Newswires
October 22, 2020 07:14 ET (11:14 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Blackstone (NYSE:BX)
Historical Stock Chart
From Mar 2024 to Apr 2024
Blackstone (NYSE:BX)
Historical Stock Chart
From Apr 2023 to Apr 2024