It seems that every day, there is another news story bashing private equity.

More often than not, these articles focus on the latest example epitomizing the negative impact private equity ownership has over portfolio companies. From nursing homes to toddler gyms, coverage has sought to show how stakeholders suffer when private equity moves in. 

Taken together, the drumbeat of negative press has created a massive reputational problem for the industry. It has fueled scrutiny from Washington D.C., apprehension among portfolio company employees, and reservation from LPs. And it’s clear that increased communication from private equity firms has not yet turned public opinion.

To make real progress on reputation, the industry must double-down on improving outcomes for its stakeholders. Because ultimately, action drives reputation.

Here are four ways private equity can take action to move the needle on public perception, one portfolio company at a time:

  1. Boost employee experience. Perhaps the most chronicled fear of private equity ownership is that the company will undergo significant change, resulting in layoffs and more constrained resources. Flip this on its head. Take meaningful steps to improve job quality and satisfaction. Often, the industry will point to overall job creation numbers, but this isn’t everything. Focus on the employee experience. Measure it and showcase powerful stories from regular workers—not just the CEO—who benefited under new ownership.
  2. Focus on customer outcomes. Evermore, the industry is under scrutiny for producing worse outcomes for end users. This is paramount in the realm of healthcare, where quality of care is especially high stakes. Private equity often highlights the positive impact of ownership from the perspective of its companies’ management, but how about those who rely on them? Share stories directly from patients and customers whose lives have positively changed since the time of initial investment. Show how changes made under PE ownership directly improved a vital outcome for someone who relied on the company.
  3. Lean into crisis. When crisis presents itself, decisiveness is crucial. If there is a seismic event that impacts your portfolio, such as the recent failure of Silicon Valley Bank, show how your firm is stepping in without equivocation to support its companies. Explain how private equity ownership adds value in those situations, which would not otherwise be possible. Even if there is an isolated bankruptcy event at one of your portfolio companies, make sure you have a plan in place that reassures workers they will be taken care of—and back it up with swift action. Leave no doubt you are on their side.
  4. Make exit a win-win. Upon exit, there is a unique opportunity for employees—not just GPs and LPs—to share in a successful investment period. Ensure all workers, no matter what rank, benefit from this important moment. This will help define how they look back on their efforts to create value under private equity ownership. Make sure the employees win when private equity finishes the job. Certain firms have started taking meaningful steps towards adopting this shared ownership model, which points the way forward for the industry. Communications programs go much further when rooted in this kind of action.

Undoubtedly, the industry will continue to face reputational headwinds for years to come. With a negative impression etched in the minds of many, every familiar example—no matter how peripheral—will only reinforce this undesired reputation. Yet, by committing to take these actions at the portfolio company level, these firms can start to turn the tide.

Tim Quinn is an Executive Vice President at Edelman Smithfield