ADDRESSING LABOR RISKS IN PRIVATE EQUITY

Private equity firms own at least 31,000 companies employing 13 million US workers, often in low-wage sectors. The document asserts that poor workforce relations and high bankruptcy risks in private equity-backed companies can lead to material financial losses, while proactive workforce management—including better wages and health and safety practices—enhances company performance and investor returns. Several US state pension funds managing over a trillion dollars have already adopted such policies to integrate labor risk assessment into manager selection and monitoring.

• Private equity-backed portfolio companies employ approximately 13 million workers in the United States, representing nearly 10 percent of the private sector workforce, with significant concentrations in low-wage industries such as retail and hospitality.
• Poor workforce management in private equity portfolios creates material financial risks, including operational disruptions, litigation, fines, and reputational harm, while companies with workforce risk management programs and investments in employee wages and benefits report better performance.
• State pension funds managing more than a trillion dollars in combined assets, including CalPERS and funds from New York State Common, Maryland, Massachusetts, and Illinois, have implemented Responsible Workforce Management policies to manage risk through due diligence and manager selection.

APA

Private Equity Stakeholder Project (n.d.). ADDRESSING LABOR RISKS IN PRIVATE EQUITY. https://pestakeholder.org/wp-content/uploads/2026/04/PESP_OnePager_LaborPrinciples_April_2026.pdf

Chicago

Private Equity Stakeholder Project. ADDRESSING LABOR RISKS IN PRIVATE EQUITY. n.d. https://pestakeholder.org/wp-content/uploads/2026/04/PESP_OnePager_LaborPrinciples_April_2026.pdf.

Wikipedia

{{cite report |author=Private Equity Stakeholder Project |title=ADDRESSING LABOR RISKS IN PRIVATE EQUITY |url=https://pestakeholder.org/wp-content/uploads/2026/04/PESP_OnePager_LaborPrinciples_April_2026.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{privateequitystakeholderprojectndaddressing, author = {{Private Equity Stakeholder Project}}, title = {{ADDRESSING LABOR RISKS IN PRIVATE EQUITY}}, institution = {Private Equity Stakeholder Project}, url = {https://pestakeholder.org/wp-content/uploads/2026/04/PESP_OnePager_LaborPrinciples_April_2026.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }