Private Equity in Global Capital Markets: Redefining Corporate Ownership and Long-Term Value Creation

Private equity has grown from a niche buyout technique into a structural feature of global capital markets and, in doing so, it has changed how corporate ownership is exercised rather than simply who exercises it. This article asks whether private equity represents a genuine transformation of corporate ownership and value creation or whether it repackages long-standing agency cost solutions inside a different institutional wrapper. Drawing on developments in the United States, the United Kingdom, the European Union, Singapore and Australia, the article argues that private equity’s most significant contribution is not concentrated ownership as such but its emergence as something closer to a private regulator of corporate behaviour, substituting contractually negotiated governance for the public disclosure bargain that listed companies have traditionally accepted in exchange for access to public capital. The article examines board accountability under sponsor ownership, tests the financial engineering versus operational value creation debate against the empirical literature and asks whether disclosure and stewardship frameworks are keeping pace with private equity’s growing footprint in markets that were once organised almost entirely around public ownership. It concludes that private equity has not erased the separation of ownership and control identified by Berle and Means. It has relocated that separation, and the regulatory architecture built around the industry has so far addressed the fund manager more thoroughly than the portfolio companies, workers, and markets that ultimately live with the consequences.