Resources for private equity investors seeking to mitigate labor-related risks
State pension funds managing over a trillion dollars in combined retirement assets have adopted Responsible Workforce Management policies to help drive value and manage risk in their private equity portfolios, including New York State Common, Maryland, Massachusetts, Illinois, and CalPERS.
Private equity-backed portfolio companies employ 13 million US workers, which is nearly 10 percent of the private sector workforce. The private equity industry is facing increasing scrutiny as returns drag. The standard buyout playbook of loading portfolio companies with debt, fees and aggressive cost cutting poses risks to workers, communities and investors.
By integrating workforce policies into manager selection, due diligence and monitoring, investors can better assess and manage potential labor-related risks within their portfolios. PESP has created a list of resources for investors below to assist in considering, crafting, and implementing similar protections for their investments.
Labor policy resources for investors:
Private Equity Labor Policy Comparison: compares the policies of five funds that have recently adopted workforce principles.
Addressing Labor Risks in Private Equity Fact Sheet: Important facts for investors considering how to address risk in their private equity portfolio.
Case Studies: The financial fallout from poor labor practices.
Hundreds of private equity firms subject to responsible workforce principles: an interactive list of which private equity firms fall under existing state pension policies.
Additional resources:
Bankruptcy Tracker: Find private-equity backed bankruptcies from 2024 and 2025
Private Equity Employer Tracker: running database of US-based private-equity backed companies that employ more than 7,000 workers
