Inside the Strategy Room 228. How talent drives value in private capital
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Dec 5, 2024 Marla Capozzi, a McKinsey partner and founder of CEO Alpha, along with Claudy Jules, a former McKinsey partner, delve into the vital role of talent in private capital. They discuss the challenges of sourcing and retaining top talent as key to driving value in organizations. Insights from CEO interviews highlight the strategic shift in roles for HR leaders. They also touch on the importance of culture and governance, sustainable investment strategies, and the intricate link between effective talent management and long-term success.
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Human Capital in Private Equity
- Private equity firms emphasize "human capital" because financial capital alone cannot create value.
- Talent is crucial, especially now, and encompasses leadership, culture, and organizational design.
Evolving Role of CHROs
- Private equity firms are shifting from transactional HR to viewing CHROs as value creation partners alongside CEOs and CFOs.
- This reflects a growing recognition of talent's importance, aligning with sponsors' focus on long-term value.
CEO Alpha and Value Creation
- CEO performance significantly impacts company value, especially in private equity.
- Key factors include ambition, leadership skills, and operational essentials like performance/finance, strategy, and talent/culture management.