PERG annual report on Walker Guidelines

The Private Equity Reporting Group (PERG) has published its sixteenth annual report on the private equity industry’s conformity with the Guidelines for Disclosure and Transparency in Private Equity (known as the Walker Guidelines).

The guidelines aim to improve disclosure and transparency in the PE industry and apply to the largest portfolio companies (meeting certain size and employment thresholds) and the PE firms behind them. Portfolio companies are expected to make certain disclosures in their annual reports including around ownership, board composition, and other matters concerning the business.

For the 2023 period, 81 portfolio companies were within the scope of the guidelines (up from 73 in 2022), of which a sample of 25 were selected for detailed review of their compliance.

The key findings in the PERG annual report include:

• 60% of the portfolio companies sampled prepared disclosures to a good or excellent standard (unchanged from 2022);
• 60% included a statement of compliance within their annual report, up from 52% in 2022;
• in some specific areas such as: (i) non-financial KPIs; (ii) trends and factors affecting future development, performance or position; and (iii) gender diversity, PERG noted a deterioration in the quality of disclosures; and
• in some cases, portfolio companies had to publish an addendum to their annual report to rectify failures to comply with their disclosure requirements the first time.