In the business of recruiting financial advisors, it’s true that our industry has been programmed to think of a “perfect fit” in terms of dollars and cents. When you read headlines about impressive mergers or new hires, the deal is often centered on the financial benefits—you might even see the word “synergy” used a few times when comparing the client base or organizational structure.
But the reality is, when advisors make the monumental decision to join a new firm, the reasons they’re looking elsewhere are usually emotional ones. Maybe their current firm doesn’t make them feel valued. Maybe they don’t feel like their environment is reflective of their own experiences or personal views. Or maybe, the advisor disagrees with the ethics of their leadership team.
In over 20 years of recruiting financial advisors, I can tell you that financial fit is much easier to find than cultural fit.
In particular, this past year as the Black Lives Matter movement shined a light on the many systemic issues impacting BIPOC (Black, Indigenous, and people of color) folks and women in our industry, this question has come up often: How can advisors identify firms that are making real progress with Diversity, Equity, and Inclusion (DEI)?
Usually, this topic is presented during conversations with under-represented advisors or those who see the significant benefits that exist in having a fully diverse team. These advisors want to ensure that the organizations they’re looking to join are actually doing the work, versus simply using diversity as a recruitment tool or public relations campaign.
So, how can advisors search for prospective firms through the lens of DEI?
1. Learn To Spot The Red Flags
According to Sonya Dreizler, the founder of Solutions with Sonya—a consulting firm that fosters candid conversations about gender and race in financial services—there are certain red flags that can indicate a firm is all talk, no walk. These flags include little to no racial or gender diversity on the team page of their website, and no public indications that the firm is working on outreach and inclusion initiatives.
“Statements about diversity and inclusion, but no time or dollars devoted to internal education initiatives or external outreach programs, are another [red flag],” says Sonya.
In fact, there are a lot of context clues you can find from simply looking through a firm’s website.
“There are firms who are quick to appoint a Chief Diversity Officer or similar role and delegate the diversity, equity, and inclusion responsibilities to that person,” says Stephanie Foster, chief administrative officer at XY Planning Network. “If the firm’s website indicates that the only member of an under-represented group is the CDO, then I would question how serious they are about DEI.”
This CDO role, she says, typically ends up with limited resources and limited authority to make any significant changes within the company.
“Another red flag can be high turnover rates for women and BIPOC,” says Sonya. “Getting that information will take a bit of research if the firm hasn't been on your radar for a while.”
2. Ask Questions
Once you get to the meeting stage with a company, it’s important to write down the questions you have about the company’s DEI initiatives.
“I am not afraid to ask about diversity data and specific examples on how the company is planning on diversifying their pipeline to leadership roles,” says Stephanie. “If it becomes awkward then that tells you there is still work to be done.”
In addition, Stephanie recommends speaking with under-represented groups who are already working there and asking them to share their experiences with you. In her experience, firms that have excelled in diversifying their workforce have been successful for two reasons: their DEI efforts are led by the CEO and executive leadership team, and they have clear success metrics in place.
3. Find A Values-Aligned Recruiter
If you’re working with a recruiter, be upfront about the qualities you’re seeking in a future firm. A good partner will help weed out firms that aren’t aligned with your needs and values, and they help with a lot of the legwork and research to ensure your meetings are productive.
How do you find a recruiter that will work with you side-by-side to navigate the cultural fit? Start by asking friends in the industry for recommendations. And bring your “Cultural Fit Checklist” to the first recruiter meeting. If the recruiter seems unsure or challenged by this idea, they probably won’t have your best interests at heart in the long term.
Firms that are intentional about their diversity and inclusion efforts are better positioned to meet the needs of both their advisors and the clients that they serve in the long term. In the end, the responsibility lays in the hands of our entire industry—leadership teams and recruitment partners in particular—to ensure that under-represented advisors are valued, listened to, and given every opportunity to work at a firm that is equipped to help them thrive.
Ryan Shanks is founder and CEO of FA Match, a digital recruitment platform that connects experienced advisors with financial services firms equipped to help them thrive. Ryan brings over 20 years of experience as a recruiter and “sports agent” to financial advisors. Learn more at www.famatch.com.