Private Equity
Governance performance reviews: a practical guide to maximising private equity value
Aug 13, 2025
Governance is a value lever. Used well, reviews expose board constraints, align leadership with the investment thesis, and de-risk exit. This guide shows how to run governance performance reviews that move EBITDA and multiple, not just paperwork.
Why governance reviews matter in private equity
Governance shapes pace and quality of decisions. Reviews surface board composition gaps, sluggish committees, and unclear accountability that slow the value creation plan.
For investors, the upside is faster execution, cleaner reporting, and fewer surprises during diligence. The downside protection is real. Strong governance reduces key-person risk, flags strategy drift early, and documents controls for lenders and buyers.
What good looks like for PE-backed boards
Good boards in PE portfolios are small, skilled, and focused. They link every agenda to the investment case and track progress against a simple scorecard.
Non-executives bring targeted expertise across sector, go-to-market, digital, and M&A. Chairs run disciplined meetings with clear pre-reads, timeboxes, and decision logs. Committees operate with tight scopes and close any audit or remuneration issues quickly.
Measure what matters: metrics and benchmarks
Anchor the review on measurable governance drivers tied to value:
Board effectiveness: meeting cadence, time on strategy, decision lead times, action closure rates.
Composition and skills: coverage across finance, commercial, digital, people, and ESG.
CEO and top team oversight: goal clarity, feedback quality, succession readiness.
Risk and controls: audit findings, policy adoption, data privacy posture.
Culture and dynamics: psychological safety, challenge quality, independence.
Use external benchmarks to set targets and identify gaps by stage and sector.
From findings to a value creation plan
Translate insights into a 12- to 18-month governance workstream:
Refresh board skills and independence where needed.
Tighten operating rhythm: quarterly strategy deep dives, monthly KPI packs, and short decision memos.
Upgrade reporting to investment-grade quality.
Formalise CEO evaluation, incentives, and succession.
Close compliance gaps that could delay financing or exit.
Assign owners, timelines, and success measures. Track progress like any other VCP initiative.
Governance through the portfolio lifecycle
Seed stage to exit needs different oversight:
Early scale: emphasise go-to-market expertise and cash discipline.
Mid-cycle: strengthen audit, people, and digital capabilities; prepare for add-ons.
Pre-exit: shift to disclosure readiness, predictability of numbers, and board independence optics.
Re-run targeted reviews at each phase to keep governance fit for purpose.
Exit readiness and disclosure
Buyers test governance first through data rooms and management meetings. Arrive with:
Documented board evaluations, action logs, and closed items.
Clear role charters, committee terms, and updated policies.
Evidence of CEO performance management and succession planning.
ESG and data privacy artefacts aligned to regulation.
This shortens confirmatory diligence and supports a stronger multiple.
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———Good boards in PE portfolios are small, skilled, and focused. They link every agenda to the investment case and track progress against a simple scorecard.
Non-executives bring targeted expertise across sector, go-to-market, digital, and M&A. Chairs run disciplined meetings with clear pre-reads, timeboxes, and decision logs. Committees operate with tight scopes and close any audit or remuneration issues quickly.
8
———Good boards in PE portfolios are small, skilled, and focused. They link every agenda to the investment case and track progress against a simple scorecard.
Non-executives bring targeted expertise across sector, go-to-market, digital, and M&A. Chairs run disciplined meetings with clear pre-reads, timeboxes, and decision logs. Committees operate with tight scopes and close any audit or remuneration issues quickly.
9
———Good boards in PE portfolios are small, skilled, and focused. They link every agenda to the investment case and track progress against a simple scorecard.
Non-executives bring targeted expertise across sector, go-to-market, digital, and M&A. Chairs run disciplined meetings with clear pre-reads, timeboxes, and decision logs. Committees operate with tight scopes and close any audit or remuneration issues quickly.
10
———Good boards in PE portfolios are small, skilled, and focused. They link every agenda to the investment case and track progress against a simple scorecard.
Non-executives bring targeted expertise across sector, go-to-market, digital, and M&A. Chairs run disciplined meetings with clear pre-reads, timeboxes, and decision logs. Committees operate with tight scopes and close any audit or remuneration issues quickly.