The perception of the industry is one of the barriers to diverse members: Many potential advisors still feel financial planning is all about Wall Street rather than about helping individuals, Schweiss says. “It is going to take a lot of time to bring in a more diverse population of advisors. And I am not just talking about young people but also about women who are coming back into the workforce, ex-military and career changers.”
He says the FPA is working with schools, colleges and military organizations to try to draw a more diverse group of people to the profession.
Despite the many efforts by organizations and firms, “the numbers are still abysmal,” says Christopher Woods, chair of the Diversity and Inclusion Committee at the FPA. “It is so hard to make progress. Every firm is handling the issue with varying degrees of success. If you did an examination of every firm, you would find different holes in each of their efforts.
“It comes down to recruitment, retention and promotion,” he adds. Once a woman or minority candidate is hired, he or she needs to see a path forward in the firm and needs to feel included and valuable. “Unfortunately, the numbers have not moved much. Employees also need a safe path for reporting incidents that make them feel uncomfortable or not included,” Woods says.
“You still do not see a lot of diversity in senior positions. Mentors and sponsors can help,” he adds. People need to be supported while they build networks to draw clients from, and they need a financial safety net while they are getting started, especially in an industry that often operates on commissions at first.
Angela Holliday, president of Frost Brokerage Services and Frost Investment Services in San Antonio, feels “progress is being made but incrementally due to the long-standing nature of our social and cultural issues. The difficulty attracting women and people of color are deep-rooted issues that are complex and multifaceted,” she continues. “The financial services business model was built on attracting wealthy individuals as clients, usually white males, who could afford products and services. Unfortunately, wealth inequality in the United States has continuously increased. Aspiring to a profession where you’ve seen someone who looks like you has only served white males as women and people of color have been minimally a part of the picture.”
The industry cannot continue to let older, white males dominate the profession, she says, because those firms that fail to work with diverse communities will miss opportunities and suffer competitive disadvantages. “As for employees,” she says, “diversity has consistently proven to increase the financial performance of the firm, as well as fostering creativity through a greater variety of problem-solving approaches and ideas.”
Moneta Investment Group Advisors, a fee-only financial services firm with offices in Denver and St. Louis, has succeeded in recruiting and retaining women advisors says Bethany Wilkinson, chief talent officer, and Anthony Palazzolo, director of strategic planning and performance management.
Fifty-four percent of Moneta’s total staff members are female. In the management level, 62% of the members are women. “We have made diversity part of our decision-making process,” Wilkinson says.
“Once we have a diverse advisory base, we can better serve a diverse client base,” Palazzolo adds. “This is not a project for us; it is an ongoing process and it is done intentionally.”
The advice and assistance of women financial advisors is often sought out by both female and male clients. Firms also are finding it easier to hire women, according to Nina O’Neal, investment advisor and founder of the Female Advisor Network, a national organization of female financial advisors. “But firms find it hard to keep women advisors because they quit when they do not receive the support they need inside the firm,” she says. O’Neal participated in a recent webinar, “Closing the Gap: Women in Financial Services,” sponsored by FMG Financial Services, which is based in Worcester, Mass.
FMG produces a guide on how firms can provide more help for female advisors, including everything from providing equal compensation to improving the workplace culture. A workplace welcoming to women has not always been available at financial firms.
“Historically, the industry has not taken the steps necessary to intentionally address the woman’s experience,” says Sandy Botcher, head of field talent and leader of the women’s initiative at Milwaukee-based Northwestern Mutual. “Women need to be supported to stay at a firm and grow.
“Women are taking more control of the family finances, and [including women advisors] is essential for a firm to grow,” Botcher says. “The effort to diversify the industry is a marathon, and sometimes progress is not seen overnight.”