The number of women and visible minorities in Canadian venture capital (VC) and private equity leadership roles grew in 2024—despite headlines to the contrary—as formal environmental pledges took a hit, according to a new report from the Business Development Bank of Canada (BDC).
“Despite the headlines, people truly believe that [DEI] is important.”
Paula Cruickshank,
BDC
Through its venture arm, BDC Capital, the Crown corporation is the most active VC investor in Canada and invests directly in companies and indirectly in funds. Its 2025 DEI & ESG Industry Report, released Wednesday, surveyed the dozens of firms that BDC invests in and found an uptick in women in senior firm leadership and a downturn in climate pledges.
BDC senior VP of investments Paula Cruickshank said the numbers tell a different story than the anti-DEI backlash accelerated by the 2024 United States election. She was encouraged by the report’s year-over-year consistency across diversity metrics and environmental, social, and governance (ESG) investing.
“Despite the headlines, people truly believe that it is important,” Cruickshank said in an interview with BetaKit.
Many post-election headlines tell a story of corporations and tech companies rolling back policies and hiring practices meant to promote equity and inclusion. Though advocates say the shift in Canada was less overt, it still manifested as some related programs and sponsorships ended, mostly in 2025.
The success of diversity, equity, and inclusion (DEI) and ESG policies in boosting fund performance is one reason why they aren’t being abandoned so quickly in Canada. Other firm leaders interviewed for the report reinforced that DEI and ESG lead to increased financial returns. Kathryn Wortsman, managing partner at Toronto-based fund Amplify Capital, said that its financial success is “closely tied to the diversity within our portfolio companies,” especially at the leadership level. Olivier Quenneville, CEO of Québec investor network Réseau Capital, said in a statement that funds with an ESG strategy “strengthen the financial performance of their portfolios.”
More women at the top, but retention lags
The gender representation on general partner (GP) investment committees, which make investment decisions at a given fund, rose in 2024. Eighty-eight percent of firms included at least one woman on these committees, up from 63 percent in 2021, the report said.
However, gender parity was still only 34 percent across the workforce, and the makeup of junior teams got slightly less diverse year over year.
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The report also offered a peek at the policies firms are employing to encourage diverse hiring and retention. Over 90 percent now have family leave policies and anti-bias policies in hiring, while 71 percent have a harassment reporting system.
Fewer than half of firms track progress on inclusion through internal culture surveys, while 41 percent have a diversity target for portfolio companies.
While nearly 90 percent of general partner investment teams in Canada now have at least one woman, retaining these VCs is still a challenge, the report said. In 54 percent of GPs, at least half of all departures were women. The organization Canadian Women in VC tracked a similar trend this year, finding that about one in four women left the industry between 2019 and 2024.
Cruickshank said women gaining more ownership could help improve retention. “Working in VC is hard work, so you need to be rewarded for it,” she said. “You need to have your piece of the pie.”
BDC has been allocated hundreds of millions of dollars for investing in women-led firms and startups. In 2022, it launched the $500-million Thrive platform, which includes a $300-million Thrive Venture Fund for women-led startups. The Crown corporation also put $50 million this year toward an entrepreneurship-through-acquisition fund to help women buy businesses from aging owners. According to its latest annual report, the bank has directly supported 21,586 women entrepreneurs in Canada and is on track to reach nearly 23,000 by fiscal 2027.
Firms shy away from “grandiose” ESG claims
On the environmental side, the report saw a pullback in the number of firms pledging to reach carbon neutrality—down to only five percent, compared to 18 percent in 2022.
Cruickshank said that fewer pledges indicates a “maturity” around understanding the complexity of climate change and its impact on the economy. She pointed to an increase in actions with more immediate impact, like implementing ESG in due diligence and adopting policies to curb air travel.
“That’s more within their control than trying to have a grandiose impact with something they have less control [over],” Cruikshank said.
She added that slashes to government support for cleantech in the US have contributed to an uncertain climate surrounding ESG.
The report noted that new Canadian greenwashing regulations have prompted some organizations to “scale back” climate disclosures. In July 2024, new explicit provisions targeting “greenwashing” came into effect, targeting misleading claims that make a company’s environmental record seem better than it is. Amendments to the Competition Act tightened regulations on how a brand, firm, or company could represent the environmental benefits of its activities.
Feature image courtesy Unsplash. Image by CoWomen.