Britain’s leading private equity lobby group is set to oust Peter Linthwaite, its chief executive, in response to his failure to fend off rising criticism of the industry from trade unions, MPs, the media and the public, The Times has learnt.

It is understood that Wol Kolade, the chairman of the British Venture Capital Association (BVCA), has ordered a strategic review of the trade body in light of its response to a prolonged series attacks.

Mr Kolade, who runs Isis Equity Partners, said yesterday that the organisation had not acted quickly enough to defend the industry. He said: “As an industry, we have to accept that we have not been good at putting our case across.”

One industry practitioner, who declined to be named, said it was expected that Mr Linthwaite would “step down” as chief executive in September as part of the review. Doubts over Mr Linthwaite’s future came as he and the BVCA faced a grilling yesterday from the Treasury Select Committee.

For months private equity executives have candidly criticised the BVCA for not doing enough to defend the industry in the face of fierce attacks from trade unions, in particular the GMB, which has mounted an effective campaign against firms such as Permira, Blackstone, CVC and KKR, branding them asset-strippers.

Insiders say that rather than addressing the issues head on, Mr Linthwaite and his executive team have buried their heads in the sand and let the unions and the media run away with the story. As the crisis mounted this year, private equity partners, such as Damon Buffini, the head of Permira, took it upon themselves to speak out.

Finally, the BVCA did act, in March, by setting up a working party chaired by Sir David Walker, the City grandee. But many said that the move to develop a code of conduct was a case of too little, too late.

The association then quickly changed its name, to incorporate the “private equity” world rather than just the venture capital community, but the effort was bungled and failed to catch on. “I think they’ve tried to do a good job, but they’ve been very slow off the mark,” one senior private equity executive said. “They really need to get their act together.”

Yesterday Members of the Treasury Select committee turned on the trade group, demanding answers to criticisms that private equity executives have exploited loopholes in tax laws to boost their personal income.

Angela Eagle, a Labour MP, said that the BVCA’s responses were “the most obstructive piece of evidence we’ve been given for a long time”.

Mr Linthwaite joined the BVCA in September 2005. He replaced John Mackie, a respected private equity veteran, who had formerly worked for 3i and held the chief executive position for five years.

Last night a spokesman for the BVCA confirmed that the review was under way. He said: “We are looking at the way the industry is developing and how the BVCA meets the demands of that new environment.”