Don’t conflate diversity and ESG

Don’t conflate diversity and ESG
For the financial advice community, achieving diversity represents its future
JUN 21, 2020

Societal issues remain at the fore of the American mindset right now. And when emotions reach the heights that they have, it becomes common — and risky — to conflate issues that are similar but not the same. In that vein, I want to address a topic that I consider enormously important for understanding the future of the industry: ESG is not diversity. ESG is an investment strategy. Period.  

Rather than making investment decisions using metrics like price-to-earnings ratios or Bollinger Bands, they’re based on policies and practices that meet a set of environmental, societal and governance expectations. But the ultimate goal of ESG is to deliver investment returns. 

Diversity is far more important. Diversity means complete representation throughout a community. For the financial advice community, achieving diversity represents its future. 

It’s well documented that there is a gap in access and use of financial advice and planning between different communities. If you believe, as I do, that financial advice and planning provide real benefits, then you should pursue diversity to make this essential service available to all communities.  

To me, that difference is why we must never conflate ESG and diversity. 

Latest News

Just as wealth industry M&A was picking up, economic uncertainty could kill it again
Just as wealth industry M&A was picking up, economic uncertainty could kill it again

Deal volume increased post-election but now caution has taken over.

Want to get the most out of alts? You’ll have to do your homework
Want to get the most out of alts? You’ll have to do your homework

Advisors who expect an edge from alternatives' illiquidity premium – without understanding the underlying terms and explaining them to clients – have a world of learning to do.

'Finfluencer' Ponzi scheme defrauds investors of over $20M
'Finfluencer' Ponzi scheme defrauds investors of over $20M

The social influencer Tyler Bossetti pleaded guilty to wire fraud and aiding in the filing of false tax documents as a result of the real estate scheme, which ran from 2019 to 2023 and used platforms including Facebook and YouTube.

US annuity sales see sixth straight $100B+ quarter
US annuity sales see sixth straight $100B+ quarter

The latest LIMRA data release shows continued growth in RILAs, variable annuities, and FRD products, though researchers argue more education is still needed.

RIA moves: Thiel's Indivisible welcomes Ride Wealth Partners, $4B Beacon snaps up Astor
RIA moves: Thiel's Indivisible welcomes Ride Wealth Partners, $4B Beacon snaps up Astor

Indivisible Partners builds on its strategy to take turf in the independent space with its latest move in Colorado.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.

SPONSORED Beyond the dashboard: Making wealth tech human

How intelliflo aims to solve advisors' top tech headaches—without sacrificing the personal touch clients crave