Research finds double standard for misbehaving female advisers

Male advisers are three times more likely to go rogue, but women pay higher price for transgressions

Mar 13, 2017 @ 1:48 pm

By InvestmentNews

+ Zoom

While male advisers are more than three times as likely to engage in misconduct than female advisers, women face much more severe punishments at the firm and industry level, a report finds.

According to research conducted at the University of Chicago's Booth School of Business Stigler Center, female advisers are 50% more likely than male advisers to be fired or separated from their jobs following an incident of misconduct. They also face longer periods of unemployment and are 30% less likely to find a new position in the industry within a year, say researchers Mark Egan, Gregor Matvos and Amit Seru in a paper titled, "When Harry Fired Sally: The Double Standard in Punishing Misconduct."

The research found that, on average, one in 11 male financial advisers have records of past misconduct, compared with only one in 33 female advisers.

Past misconduct also weighs more heavily on women than on men, the research found. Male advisers with misconduct are only 19% less likely to be promoted relative to other male advisers, while female advisers with recent misconduct are 67% less likely to be promoted relative to other female advisers, the researchers found.

Despite their more lenient treatment, male advisers are twice as likely as women to be repeat offenders, and they engaged in misconduct that is 20% more costly for their firms to settle. The research also found that female advisers with no female representation at the executive or ownership level are 42% more likely to experience job separation than male advisers at the same branch following an incidence of misconduct. By contrast, firms with equal representation of male and female executives or owners discipline male and female advisers at similar rates.

0
Comments

What do you think?

View comments

Recommended for you

Sponsored financial news

Featured video

Events

What are advisers clamoring for in the tech space?

Advisers have made their needs known, and fintech firms are listening. Hear from the experts at Fuse what they're doing to help advisers build and scale practices.

Video Spotlight

Are Your Clients Prepared For Market Downturns?

Sponsored by Prudential

Video Spotlight

Path to growth

Video Spotlight

Path to growth

Latest news & opinion

Top 10 financial firms ranked by investor satisfaction

Find out which firm took the top slot for overall investor satisfaction for the second year in a row.

What not to say to clients when the markets drop

Here's what advisers should steer clear of saying the next time stocks turn downward.

A special need for financial advice

Advisers don't have to be experts to help special needs families get a jump on lifelong planning.

Broker-dealers and RIAs at loggerheads over fiduciary rule delay

Companies and groups weighing in with comment letters have vastly different viewpoints on the delay's potential impact.

7 conferences taking advisers beyond financial services

Consider investing some time in learning to build corporate culture, be a better listener and other important skills.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print