Women’s rise to senior positions at advisory firms has stalled

Despite having less experience than women, men in the service adviser role, for example, were nearly twice as likely to have been promoted in the past year.

Women are well-represented in the financial advice industry from an overall staffing perspective — making up about half of total employees at a typical advisory firm — but that picture changes dramatically when we look deeper.

In breaking out the roles women hold, it is clear the business remains, especially in firm ownership and client-facing professional roles, a male-dominated field.

According to InvestmentNews Research’s latest advisory firm benchmarking data, just 19% of people in partner-level positions, or with titles indicating ownership, are women. When it comes to employee advisers — non-owner advisers holding the Lead (Level 1), Service (Level 2) or Support (Level 3) titles — 36% are women.

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While advisers in more senior roles tend to be male — a trend that hasn’t budged since the 2013 InvestmentNews Adviser Compensation and Staffing Study — changes could be ahead.

(Don’t miss: The 2015 Compensation and Staffing Study)

Women saw gains in entry- and intermediate-level positions that traditionally lead to more-senior professional roles. In the 2015 iteration of our study, 49% of entry-level advisers — the support adviser (Level 3) position, often known as a paraplanner, analyst or associate — were female. That was up from 44% in the 2013 study.

Women also tend to inhabit one of two other entry-level paths that can lead to client-facing professional roles down the line. Client service administrator, a job function that directly supports adviser interactions with clients, has an 84%/16% female/male split.

But research analysts and portfolio managers, roles that also can lead to more-senior advisory positions, are staying stubbornly male; both are staffed at an identical 82% male to 18% female ratio.

(Related read: What it takes to retain women advisers)

When we examine data on promotions and experience by gender, it is not difficult to find evidence for why — despite the number of women in lower-level advisory roles’ rising since our last study — the number of female lead professionals has stagnated. While women and men were almost equally likely to have been promoted in the past year in the support adviser role, when we look one level up at service advisers, men were nearly twice as likely to have been promoted in the past year (21.4% vs. 12.9%).

These service advisers meet with clients and deliver the services but are not expected to win new business for the firm — with titles such as wealth adviser, financial adviser or associate adviser.

In both cases, women usually had more experience than their male counterparts, indicating they’re more likely to remain in the same role longer.

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A big part of that stagnancy could be business development, or winning new business in general. The sales culture and sales mentality is what leads to the upper echelons of compensation and status at firms, and it could be that women aren’t successfully breaking into those roles. What we can say from evidence in the study is that new adviser positions that carve out these responsibilities, such as business development officer or business development specialist, are overwhelmingly male (96% for partners and 72% for employees), which underscores the fact that these responsibilities or opportunities aren’t necessarily being embraced by or allocated to women.

(Staffing insights: The highest paying jobs at advisory firms)

Another post where women play a smaller role is in firm ownership or as primary relationship managers. We did not see much evidence of expansion in these categories in the study results.

Encouraging, however, is the increasing number of young, professional-track female advisers joining the business. Enormous advantages are inherent for advisers who serve their own representative demographic. With women increasingly serving as the primary breadwinners and financial decision makers in their households, those firms who turn an eye to gender diversity when actively recruiting and developing talent are setting themselves up for advantages they’ll carry well into the future.