Private equity practices for boards of directors of public companies

Private equity practices for boards of directors of public companies enable the introduction of more effective and disciplined approaches to corporate governance. At the core of these practices are optimizing the board structure and increasing the accountability of its members, which is especially relevant for companies seeking long-term growth and sustainability.

Board structure in private equity companies

Private equity investors require boards of directors not only to meet formal compliance but also to have functional flexibility. In international practice COREDO we see that the optimal board structure in private equity includes:

Independent directors with experience in investments, M&A and risk management. Their role is not only oversight but also strategic mentorship.
Professionals in corporate strategy and operational efficiency capable of implementing PE best practices into day-to-day management.
Members with expertise in Due Diligence, compliance and financial reporting: especially important for companies entering new markets in the EU, the UK, Singapore or Dubai.

A solution developed by COREDO for one of its clients in the Czech Republic allowed the integration of two independent private equity experts and one representative of an institutional investor into the board of directors, which increased the transparency and quality of strategic decisions.

Interaction between the board of directors and management

The effectiveness of the board of directors directly depends on the quality of communications with the CEO and shareholders. COREDO’s practice confirms: regular strategic sessions, joint planning and agile approaches help build trust between the board and the executive team, as well as reduce the risk of misunderstandings with institutional investors.

In one of COREDO’s cases in Estonia, the introduction of monthly meetings with shareholders and investors not only increased process transparency but also accelerated decision-making on new investment projects.

Committees in PE boards: allocation of responsibilities

Boards of directors of public companies with private equity participation are distinguished by a developed system of committees:

Audit and Risk Committee – key for compliance control and risk management in private equity.
Strategic Committee: responsible for evaluating and executing M&A deals, monitoring the implementation of strategic plans.
Corporate Culture and HR Committee, implements mentorship practices and the development of top management.

At COREDO we recommend forming committees with clearly defined KPI s and performance metrics, which allows not only controlling but also developing the business in a multi-stakeholder environment.

Thus, the role and structure of board committees directly affect governance transparency and business sustainability, underscoring the importance of effective corporate policy in private equity.

The role of the board of directors in managing private equity

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The role of the board of directors in managing private equity becomes decisive for the successful implementation of the investment strategy and the protection of shareholders’ interests. It is through the board’s involvement that decisions on key areas are formed, from strategic choices to monitoring the effectiveness of investments, which makes private equity management more deliberate and transparent.

Corporate strategy and decisions on PE investments

Private equity investors demand high speed and quality of strategic planning from boards of directors. Our experience at COREDO has shown that implementing the OKR (Objectives and Key Results) methodology in the board’s strategic sessions not only increases the transparency of goals but also ensures their achievement within tight timelines.

In a COREDO case for a company in the United Kingdom, the board of directors with participation from a PE investor implemented a scaling strategy through a series of M&A deals, using due diligence and regular monitoring of ROI for each project.

Risk management and compliance in public companies with PE

risk management in private equity is not only financial control but also constant monitoring of regulatory changes. The COREDO team implemented an automated compliance system for a client in Singapore, which reduced the risk of AML breaches and increased trust from institutional investors.

The board of directors should regularly assess risks across key areas: financial, operational, legal and reputational. Implementing agile approaches to risk management enables rapid response to market changes and regulatory requirements.

Monitoring strategic plans and operational management

Monitoring KPIs and controlling the execution of strategic plans are among the key tasks of a board of directors with private equity participation. At COREDO we implement dashboard systems for tracking operational efficiency, which allows the board to make decisions based on up-to-date data.

In a COREDO case for a company in Dubai, the board of directors analyzed operational metrics quarterly, which made it possible to identify bottlenecks and promptly adjust the development strategy.

Effectiveness of boards of directors with private equity investments

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The effectiveness of boards of directors with private equity investments becomes a key growth factor for companies raising capital at new stages of development. Active investor participation on the board enables a focus on value creation and operational management, which is critical for achieving maximum results and investment returns.

ROI metrics for boards of directors in PE companies

Assessing the effectiveness of the board of directors is a task that requires transparent and objective metrics. In COREDO’s international practice the following methods are used:

ROI on strategic projects – analysis of return on investment for each line of activity.
Assessment of board engagement, regular surveys and analysis of participation in strategic sessions.
Comparing operational metrics before and after a PE investor’s entry reveals the board of directors’ real contribution to increasing the company’s value.

The table below shows key performance metrics:

Metric	Description	Applicability for PE firms
Project ROI	Return on investment for M&A and scaling	High
Directors’ engagement	Activity, participation in committees	Medium
Operational efficiency	EBITDA growth, cost reduction	High
Compliance and transparency	Compliance with regulatory requirements	High

Impact of private equity on culture and change management

Private equity changes not only financial processes but also corporate culture. At COREDO we observe that the arrival of PE investors requires companies to be open, ready for change, and to implement new governance standards.

In a COREDO case for a client in Slovakia, the board of directors initiated a mentorship program for top management, which increased engagement and accelerated adaptation to new market requirements.

Top-management mentoring through boards of directors

A board of directors with private equity involvement becomes a center for developing managerial competencies. At COREDO we recommend implementing mentorship programs, regular training sessions, and experience exchange between board members and top managers.

In one of COREDO’s projects in Estonia, the board organized a series of masterclasses on risk management and corporate strategy, which improved the quality of management decisions and accelerated business growth.

Managing conflicts of interest with shareholders

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Managing conflicts of interest with shareholders requires transparent procedures and a balance of interests among all participants in corporate relations. A proper strategy for resolving such conflicts helps protect shareholders’ rights, increase trust, and stabilize the business.

Conflicts between majority and minority shareholders

Private equity investments often lead to a shift in the balance of interests within a company. The holder of the controlling stake may face resistance from minority shareholders. COREDO’s practice shows that transparent voting procedures, clear allocation of responsibilities, and regular communication to all shareholders reduce the level of conflicts.

In a COREDO case for a client in the EU, the board implemented an electronic voting system and regular reports on key decisions, which increased trust among shareholders.

The role of independent directors in conflicts and transparency

Independent directors are a key element in resolving conflicts and enhancing transparency. At COREDO we recommend appointing independent directors with experience in international companies and knowledge of the specifics of private equity.

In one of COREDO’s projects in the UK, an independent director acted as a mediator between the PE investor and minority shareholders, which prevented escalation of the conflict and preserved the stability of corporate governance.

Impact of regulations on the work of the board of directors

Boards of public companies with private equity face strict regulatory requirements: from compliance to transparency of financial reporting. COREDO’s solution — integrating automated control systems and conducting regular audits — enables the board of directors to respond in time to changes in legislation.

In a COREDO case for a client in Singapore, implementing automated monitoring of regulatory changes reduced the risk of fines and increased investor confidence.

Thus, automated monitoring and regular audits become key tools for effective management of regulatory risks for boards of directors of public companies with private equity.

Let’s move on to specific recommendations for boards of directors.

Recommendations for boards of public companies with private equity

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Recommendations for boards of public companies with private equity are especially relevant when a company includes external investors as well as owners and top management. In such structures, it is important for the board to consider the interests of all parties and build flexible, adaptive interactions with shareholders and management to effectively respond to the business’s dynamic challenges.

Board management in private equity

Form the board of directors taking into account competencies in private equity, M&A, compliance, and corporate strategy.
Implement agile approaches in strategic planning and risk management.
Organize regular strategic sessions involving all key stakeholders.

Onboarding and development of board members’ competencies

Develop individual adaptation programs for new board members.
Introduce training on private equity specifics, corporate governance, and compliance.
Use mentorship and experience exchange between board members and top management.

Scaling and exit for companies with PE investments

Assess ROI for each strategic project using transparent metrics.
Implement scaling strategies through M&A, entering new markets and developing operational efficiency.
Plan exit strategies for PE investors taking into account the interests of all shareholders and the company’s long-term value.

Key conclusions and practical steps

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Boards of public companies with private equity participation become a center of strategic management, a growth driver, and a guarantor of transparency. COREDO’s experience confirms: implementing best PE practices, development towardsCompetencies of board members, effective management of conflicts of interest and regular performance monitoring allow companies not only to meet investors’ expectations but also to outperform the market.

Checklist of actions for boards of directors involving private equity:

Conduct an audit of the competencies and structure of the board of directors.
Implement agile approaches in strategic planning and risk management.
Organize regular strategic sessions with PE investors.
Appoint independent directors and develop mentorship programs.
Introduce automated systems to monitor compliance and transparency.
Evaluate the board’s effectiveness using transparent ROI metrics.

By implementing these steps, you will not only minimize risks but also create conditions for sustainable growth and long-term business value. The COREDO team is ready to support you at every stage of corporate governance transformation, offering solutions proven by international practice and adapted to the specifics of your business.