For all the advances that women have made in financial services, a large gender gap persists at the top of most advisory firms — an unsettling trend in an industry dependent on the strength of its relationships with a diverse set of clients, an increasing number of whom are women.
As
InvestmentNews Research's advisory benchmarking data
recently demonstrated, female advisers are still struggling to attain senior positions: Only 19% of those with partner-level positions or ownership titles are women.
This gap in senior leadership represents a huge missed opportunity for female professionals and advisory firms alike. The advisory profession can be extremely well suited to women in finance who seek a stimulating relationship-based position. And advisory firms that want to compete in today's complex and variegated financial marketplace urgently need a talent pool that reflects the diversity of their clients — women especially.
(Women in advice: Check out IN's inaugural Women to Watch list)
Today, senior advisory professionals share an important responsibility to better serve our female colleagues and, in the process, our clients. At the same time, women in the field can move deliberately and decisively to activate their own professional success.
OPPORTUNITY FOR WOMEN
Even in an increasingly tech-driven world, the advisory model remains heavily reliant on cultivating personal,
trust-based relationships with clients — making it difficult for any professional to step in and out of the advisory ranks. This reality can hit women particularly hard. Although women enter the profession in similar numbers as men, their representation declines over time, particularly during childbearing years when many stall out or even opt out for good.
Despite the challenges, advisory firms need to develop talented women — and not only because of the need to shape their service to the demands of women's longevity, a critical and enduring investor demographic factor.
Firms need women's voices at the top both to help shape their strategic decision-making as well as stay truly in tune with their clients' needs. In the institutional world, investment committees are increasingly diverse; firms need to bring a clearly similar set of sensibilities and perspectives to the table. And women, as clients, continue to present distinctive investing needs. As BlackRock's annual Global Investor Pulse survey has demonstrated, they tend to be more cautious, risk-sensitive investors and decision makers. By including more senior women in their ranks, firms are undeniably better equipped to mirror the concerns of institutional clients as well as serve female individual investors.
CLOSING THE GAP
For firms, the good news is that with creativity and flexibility, attracting and retaining female talent is highly achievable. The most innovative, best-performing advisory firms are already actively seeking to encourage their women's professional development. Here are three things most firms can do better:
1) Reassess areas of firm culture and business practices currently on autopilot. Certain practices not created with female professionals in view may be unnecessarily alienating. Women are generally less apt to ask for accommodations than men, so take time to listen and reconsider concerns that have gone unaddressed but may have an easy fix (like tweaking male-centric protocols for travel and entertainment).
2) Set up an internal forum for women to facilitate mentorship and idea-sharing. There are simply not enough programs to help younger women come up in the profession. Any firm can be a part of the solution by providing a venue for women to connect and learn from each other.
3) Don't try to mind-read. When it comes to addressing the needs of female professionals, it's always better to ask than to assume, particularly when treating them differently from their male counterparts. Consider instituting a formal, ongoing process to query the firm's women about their concerns and solicit their ideas on how to improve firm life.
There is no question that firms can play an integral role in promoting women's rise in the advisory field. Yet, women can drive their own success by providing honest feedback about what will help them, being realistic about the demands put on them and actively building a strong support network. Far from showing weakness, asking for help demonstrates commitment and fosters deeper, trust-based relationships with colleagues.
LOOKING AHEAD
It is an exciting time for women in the advisory field; the prospect has never been greater to step up their presence. As firms seek to encourage the development of senior women, women in turn should feel empowered to ask for what they need rather than waiting for change. And while women certainly need to actively set sights on the role they want down the road, my personal advice would be to focus on the opportunities and satisfactions of the journey as well. Financial advisers have never been better positioned to beneficially serve clients, both women and men, and female professionals bring a broad spectrum of demonstrated strengths to the delivery of advice. Female advisers should seize every chance their professional journey offers to unleash their potential as valued counselors and guides — and in the process, make a real difference for themselves, the investors they serve, and the entire advisory profession.
Hollie Fagan is managing director and head of BlackRock's registered investment adviser business.
