Taking it Private. Consequences of the Global Growth of Private Equity

The Corner House presents research about private equity that during the last two decades became an integral component of the world’s financial system – at a time when financial markets overshadowed the productive economy. Private equity was invariably behind the multi-billion buyout deals, and mergers and acquisitions that swept across the US and Europe, creating a new type of corporate conglomerate that is reshaping the way business is conducted.
Insofar as it constitutes a new form of corporate ownership, private equity poses new challenges to labour unions, NGOs and community groups because it has a significant and distinctive influence on taxation policy, corporate governance, labour rights and public services, and thus deeply affects society, human rights and environment alike.
These challenges are especially clear in Asia, which has become more attractive for private equity firms since mid-2007 when the “credit crunch” took hold and diminished the scope for the huge deals in Europe and North America.
This 54 page ‘work in progress’ paper (339KB) looks at the global growth of private equity and its social, environmental and political impacts, using India as a case study of its growing importance in Southern countries. It concludes with an outline of private equity’s vulnerabilities that may provide opportunities for public concerns to be addressed.