Fewer than half (43 per cent) of investors polled in a survey by these organisations shows they receive all information they would like from private equity managers. That number slumped to just 10 per cent when the same question was asked of consultants. There is a big mismatch: 85 per cent of fund managers think their investors get all the facts they need.

The survey report, “Searching for Alignment,” compiling results from more than 400 institutional investors, consultants, and fund managers. To request a report, click here.

The report showed that 45 per cent of fund managers said that satisfying investors’ expectations is their firm’s greatest operational challenge. The survey also suggests that managers are largely meeting expectations when it comes to basic transparency expectations. However, while 75 per cent of managers see industry and sector reporting data as most important, 75 per cent of investors and consultants seek more information on areas such as the leverage used in the fund and volatility statistics.

Private equity has traditionally been one of the more opaque asset classes. In some countries, it is difficult to obtain data on internal rates of return from unlisted private equity funds (listed funds must disclose more information). In the UK, for example, public bodies must disclose data if they receive a Freedom of Information Act request.

The survey report points to a “growing disconnect between private equity managers and investors on the depth and type of reporting data necessary despite continued growth in sector assets. Private equity managers need to direct their focus and efforts on the client service front in order to keep up with investor needs,” said Rodger Smith, managing director of Greenwich Associates.