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CVCA Report: Diversity improving but inclusion gap threatens progress

The Logic via FP | Catherine McIntyre  | Feb 17, 2022

diversity and inclusion VC 2021 - CVCA Report:  Diversity improving but inclusion gap threatens progress

The firms that make up Canada’s private capital markets are slowly diversifying, according to a new report, with more women, people of colour, LGBTQ2+ and folks with disabilities than ever across all ranks of venture capital and private equity firms.

The Canadian Venture Capital & Private Equity Association’s State of Diversity and Inclusion report—sponsored by BDC Capital, CIBC and The51, and to be released Thursday afternoon—gathered data on metrics like gender, race and sexual orientation from 413 employees across 122 firms in the country to get a clear picture of the demographic makeup of an industry that’s traditionally been overwhelmingly white and male.

Talking Point

Canada’s private capital markets are slowly diversifying their workforces, according to the latest diversity and inclusion report from the Canadian Venture Capital & Private Equity Association. Greater representation of women, racial minorities and LGBTQ2+ employees in VC firms’ junior ranks shows potential for a demographic shift at the partner level. But concerns about inclusion could threaten that progress.

See:  The Real Story of Access to Capital

The results show an improvement over the CVCA’s last diversity report, released in 2019, but president and CEO Kim Furlong said diversifying the industry is still a work in progress. Here’s what you need to know:

Women overtake men in non-management roles: Women accounted for 61.3 per cent of all non-partner employees at venture capital firms in 2021. (The report does not include data on non-binary employees.) That’s more than in the broader financial industry, which the CVCA used as a benchmark; industry-wide, 52 per cent of non-partner employees are women. In 2019, less than a quarter of VC firms that responded to the CVCA survey had women in over half of all junior-level positions, and about 14 per cent of firms had women in more than half of non-partner management roles.

Diversity overall decreases with seniority: At the partner level, the number of women dropped to just 19 per cent. For racial and ethnic minorities, representation fell from 20.6 per cent among non-partners to 18 per cent among partners, while LGBTQ2+ people accounted for 11 per cent of all non-management employees and 10.3 per cent of partners. People with disabilities—a category that includes physical, cognitive and learning disabilities, as well as mental health conditions—were the only group whose representation consistently increased with seniority, from 12 per cent of junior employees to 17.6 per cent of staff excluding partners and 19 per cent of partners.


Black and Indigenous underrepresentation: Most of the gains in racial and ethnic diversity at the VC partner level—up 5.2 per cent from 2019—came from people with East and South Asian backgrounds, while partners from Black, Indigenous, Middle Eastern and Latin backgrounds “remain few and far between,” the report notes. The CVCA identified the same pattern in the private equity sector. “Notably Black and Indigenous remain significantly underrepresented,” it reads.

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