{"id":675658,"date":"2026-07-05T21:45:19","date_gmt":"2026-07-05T21:45:19","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/675658\/"},"modified":"2026-07-05T21:45:19","modified_gmt":"2026-07-05T21:45:19","slug":"in-stories-like-this-the-data-and-the-methodology-are-key-when-private-equity-meets-public-service-journalism-data-journalism","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/675658\/","title":{"rendered":"\u2018In stories like this, the data and the methodology are key\u2019: when private equity meets public service journalism | Data journalism"},"content":{"rendered":"

When Carmen Aguilar Garc\u00eda began investigating the involvement of private equity firms in England\u2019s childcare sector<\/a> with her fellow data journalists three years ago, she didn\u2019t imagine her efforts would one day be scaled up to examine private equity\u2019s role in the entire UK economy. That ambitious undertaking by Carmen and colleagues from across the Guardian was published earlier this week<\/a>.<\/p>\n

\u201cThe initial investigation into the childcare sector in 2023 was already challenging and a big team effort,\u201d says Carmen, a data projects editor at the Guardian. \u201cExtrapolating it to the whole economy did not seem realistic back then.\u201d<\/p>\n

If such a wide-ranging and complex investigation initially seemed impossible, it also feels imperative. Unlike companies publicly traded on the stock market, businesses owned or controlled by private equity are more opaque. But, as they underpin more and more public and essential services and increasingly shape our daily lives, the scale and nature of their influence deserves closer scrutiny.<\/p>\n

Private equity firms use money from investors to buy up businesses with the aim of reshaping them and then selling them to return a profit. While the industry and its advocates argue the model can provide an engine for growth and efficiency, there are important questions about the vulnerabilities of financing models that use large amounts of debt, particularly in the public sector \u2013 and also about whether current regulation is fit for purpose.<\/p>\n

Carmen, her colleague Michael Goodier and two software developers were grappling with how to trace private equity\u2019s influence across the UK economy, when, a few feet away across the newsroom, our social affairs correspondent Jessica Murray received an anonymous tip from someone who worked for a private equity-owned children\u2019s home company.<\/p>\n

A team of more than 10 Guardian journalists, designers and developers were involved in project, including (left to right) Jessica Murray, Carmen Aguilar Garc\u00eda and Anna Leach Photograph: Alicia Canter\/Ryan Prince\/The Guardian<\/p>\n

After digging into the the story, Jessica walked over to the newsdesk to pitch an article<\/a> about what she\u2019d discovered. \u201cThe newsdesk told me that Carmen and the data team were working on a big private equity project and that we should team up,\u201d she recalls. \u201cSo the story became part of this bigger state-of-the-nation investigation. It\u2019s a good example of data journalism and human-centred on-the-ground reporting coming together.\u201d<\/p>\n

But the scale of the project and the opacity of private equity structures posed many challenges.<\/p>\n

The first difficulty when it came to measuring private equity\u2019s stake in the economy was figuring out if a given company was actually controlled by private equity. \u201cSome companies don\u2019t want to show that they\u2019re backed by private equity, but when you dig into it you find that they are,\u201d explains Carmen.<\/p>\n

The danger wasn\u2019t merely about understating the industry\u2019s foothold in the UK. Labyrinthine corporate ownership structures meant there was also a risk of overcounting, particularly when it came to measures such as company headcounts. A key finding of the investigation was that as many as one in eight workers in Britain are now employed by companies ultimately controlled by private equity firms \u2013 but calculating this figure and ensuring it was robust was painstaking work. \u201cWe had to deconsolidate large corporate structures to avoid double-counting employees,\u201d Carmen explains as she points to some of the complex corporate ownership diagrams the data team developed.<\/p>\n

And that was just one aspect of the methodology they devised for the project: \u201cWe had to build our own database of UK companies that are controlled by a private equity firm, map the whole group structure for each of those companies, and extract information related to the controlling party and the number of employees in each company.\u201d<\/p>\n

The project drew on multiple sources of data. \u201cWe don\u2019t trust data blindly, so it was essential that, for each step, we checked the accuracy of the data and understood its limitations,\u201d says Carmen. \u201cIn stories like this one, the data and the methodology are key. If either were not robust enough the story could be wrong. So if we aren\u2019t confident about the data, we don\u2019t publish.\u201d<\/p>\n

Transparency is also crucial: each of the articles published as part of the investigation contains an expandable section that goes into more detail about the methodology behind the project (see below).<\/p>\n

While Jessica\u2019s side of the investigation didn\u2019t involve analysing macro data, she likewise needed to verify and cross-check information from the initial whistleblower and other company insiders. Their insights highlighted the pressures and failings some private equity-owned public services can encounter when the model goes wrong. For example, an official Ofsted inspection of one children\u2019s homes found that it was \u201cchaotic\u201d, with \u201chigh levels of distress\u201d among the children.<\/p>\n

\u201cI was really shocked by what was in those reports,\u201d says Jessica. \u201cI\u2019d spoken to the whistleblowers and that was shocking, but then when I read the official reports, the conditions were clearly appalling. So we\u2019re not only showing how much private equity is taking over all these different services, we\u2019re also showing what it can sometimes mean for an individual who lives or works in a children\u2019s home or in a care home.\u201d<\/p>\n

Jessica was also taken aback by the widespread lack of understanding about private equity. \u201cAnother thing that might surprise people is that a lot of those in power don\u2019t fully understand this world,\u201d she says. As well as talking to economists and academics who study private equity, Jessica also asked politicians to comment on the situation. \u201cSome of them said they\u2019d like to help but they didn\u2019t understand private equity enough to feel qualified to talk about it.\u201d<\/p>\n

Hence the crucial role of public service journalism in making the world of private equity less impenetrable. To that end, Anna Leach, a visual projects editor, worked with a team on a captivating visual storytelling format<\/a> to help explain how private equity works \u2013 using a fictional veterinary practice as a case study. \u201cI chose a vet to illustrate how it works because there\u2019s been such a dramatic acceleration in private equity control of that sector over the last 10 years. There\u2019s a lot of awareness of the impact of that, with people now being priced out of pet ownership.\u201d<\/p>\n

How private equity works Photograph: The Guardian<\/p>\n

The visual explainer also illustrated a common financing structure known as a leveraged buyout. These involve private equity firms borrowing a large proportion of the funds used to buy a business and then saddling the business with that debt. \u201cIt\u2019s easy to show money flowing from one party to another,\u201d says Anna, \u201cbut some concepts such as debt are very hard to visualise.\u201d<\/p>\n

Prina Shah, a senior digital designer who worked on the visual explainer, says the use of toy figurine models not only helped make the concepts more relatable for readers, they also made it easier to engineer the way the visuals switch seamlessly between 2D flow diagrams and 3D scenes. \u201cWhat we were fundamentally doing was revealing money flows but it was important to set the scene first to make these concepts relatable and hopefully more understandable,\u201d she says. \u201cThe use of models lent themselves perfectly to sitting within a 3D world but could also be easily shrunk to be used as icons in a 2D flow diagram. The models also made the icons come alive as they look realistic but also were simple and use block colours that work well at a smaller scale.\u201d<\/p>\n

As financial literacy has become increasingly key to understanding politics and society, visual explainers can be particularly helpful. \u201cBusiness and finance are areas people are very affected by, but they often don\u2019t understand the intricacies of it,\u201d Anna explains. \u201cThe temptation is to go for the simple answers given by politicians. It\u2019s harder to look at and understand some of the complex structural factors.\u201d<\/p>\n

Part of that complexity, reflected in the Guardian\u2019s investigation, is that private equity isn\u2019t simply a villain. \u201cWe were very aware that it\u2019s more complicated than private equity being good or bad,\u201d says Jessica. \u201cPrivate equity can be good for businesses when it\u2019s done right. And there\u2019s also the role of regulation.\u201d<\/p>\n

The articles and the visual explainer prominently feature the private equity industry\u2019s defence against some of the criticisms that have been levelled at it, giving readers a different perspective on the industry. \u201cStarting with a question also creates a curiosity gap for the reader,\u201d says Anna. \u201cPeople don\u2019t want to be lectured to, they want to be given the relevant information.\u201d<\/p>\n

Again, the key challenge was ensuring that this relevant information was robust. And in turn, that required resilience and perseverance on the part of the team of more than 10 data journalists, reporters, visual journalists, software developers and digital designers who were involved in the project.<\/p>\n

\u201cWe had to adapt our initial plan several times to ensure accuracy,\u201d says Carmen. \u201cThere was a lot of problem-solving in this investigation, and many people contributed to finding solutions. There are always high and low moments in data investigations, especially in complex ones like this. Resilience, adaptation and a problem-solving mentality are essential, but also believing that what you are doing is an important contribution to society and that people deserve to know. And we had all of this.\u201d<\/p>\n

Q&AMethodology: How the Guardian estimated the involvement of private equity firms in the British economyShow<\/p>\n

The Guardian’s investigation into the scale of private equity firms in the British economy combines procurement data provided by Tussell, employment ONS data, information from the financial database PitchBook, publicly available data from Companies House and information obtained via the companies\u2019 annual accounts.\u00a0<\/p>\n

Using data from Companies House, the Guardian was able to build the group structure for thousands of UK companies, as well as identifying the ultimate controlling party for each of them as disclosed in their annual accounts.\u00a0<\/p>\n

We then used a Large Language Model (LLM) to collect information about each ultimate controlling party. A team of five journalists manually verified the responses from the LLM by checking the information against the annual accounts, the companies\u2019 own websites, news articles and databases that specialise in private equity markets, like PitchBook. This process allowed us to identify which parent companies were private equity firms or companies that were majority-backed by a private equity firm.<\/p>\n

The final list of companies ultimately controlled by private equity was then matched with public procurement data for the financial year to April 2025 provided by Tussell to find how much money went to pay for services provided by private equity-controlled firms.\u00a0<\/p>\n

The Guardian also gathered information from Companies House about the primary sector of the economy (SIC codes) within which company operates. Using an LLM, the team also extracted the average number of employees as declared by each company in their annual report. A team of three people manually verified the results.\u00a0<\/p>\n

When available, the analysis includes the company\u2019s figure of the average number of employees. However, a small proportion of companies only published consolidated accounts, which means that the number of employees reported was that for the whole group as opposed to only those working for the company.\u00a0<\/p>\n

On the other hand, a similar proportion of non-dormant companies did not report the number of employees or had not filed any accounts.\u00a0<\/p>\n

To avoid double counting employees when the company reports consolidated accounts, we subtract from the group figure the number of workers listed in the annual accounts of other companies in the group. International employees of the largest employers were also removed – when possible – to only count British workers.<\/p>\n

The final number of deconsolidated employees was later aggregated by sector using the SIC codes and compared to employment data from the ONS to calculate the proportion of people that are employed by a private equity-controlled company.\u00a0<\/p>\n

The Guardian methodology has some differences with similar analysis carried out by the Bank of England and the consultancy company EY in the number of companies and the period analysed, the approach with consolidated accounts and the type of companies included (the Guardian excludes venture capital and private credit companies).<\/p>\n

The Guardian analysis is a snapshot in time of the involvement of private equity firms in the British economy.<\/p>\n

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