New diversity report makes familiar recommendations

The report from the CFP Board outlines specific steps proven to establish and cultivate equity for employees at all levels with financial services organizations.

The CFP Board released a report Thursday outlining modes of recruiting and retaining women and ethnically diverse professionals. While the report is a significant step for the board’s ongoing efforts to make headway as an advocate for diversity within the advisory and investing ecosystem, the report mainly underscores long-established corporate talent strategies.

As soon-to-depart Kate Healy, managing director of the board’s Center for Financial Planning, noted in April at the InvestmentNews Women Advisor Summit, women are gaining ground, comprising nearly 30% of newly minted advisors. Still, women make up only 23.6% of all CFPs, and the presence of ethnic minorities in the profession likewise badly lags their presence in the American population overall.

Recruiting is only half the game; the other half is retaining and advancing underrepresented communities within the advisory and investing spheres. InvestmentNews’ annual Advisor Benchmarking Study indicates that women comprise 45% of entry-level advisors, 36% of midlevel advisors, 27% of lead advisors and only 18% of partners.

The Certified Financial Planner Board of Standard Inc.’s new report, “Creating a DEI-driven Culture,” outlines specific steps proven to establish and cultivate equity for employees at all levels within financial advisory and investing organizations. The report’s recommendations include points of training and action that employers can prioritize to infuse workplace culture with shared responsibility for diversity awareness and results.

In doing so, the report applies widely recognized strategies to the advisory and investing professions routinely promoted in high-profile research by McKinsey, in its annual “Women in the Workplace” report, and in best practice guides published ongoing by vaunted diversity think tanks such as Catalyst.

For instance, the most recent Catalyst report on diversity also focuses on retention and stresses, as does the CFP Board report, the importance of internal accountability and process transparency.