Many advisers are struggling to get firm leaders to accept the need for more diversity, but making the “business case” can drive Diversity Equity Inclusion & Belonging initiatives forward, according to participants in the Wealth Management think tank EDGE on DEIB issues in the industry.
“It's definitely not a sprint; it takes time,” said Aiysha Adams, a vice president of Osaic. “But once you do that, that's how you're going to at least get your leadership with it if that's the hard thing for your firm.”
Adams was one of several presenters at the think tank “Focused on the Future: DEIB's Exploration of the Wealth Management Industry.” The two-hour discussion, held during Wealth Management EDGE last week at The Diplomat Beach Resort in Hollywood Beach, Fla., included five presentations on specific DEIB initiatives at (or outside of) firms and a discussion with dozens of notable individuals from the whole world. industry.
Cary Carbonaro, a senior vice president with ACM Wealth, agreed with Adams, recalling how she was able to convince Joe Duran to fund women's leadership initiatives at United Capital.
“I did a business plan for Joe Duran and he gave me millions of dollars for women's leadership,” she said. “Not because it was the right thing to do, but because it was a business case.”
The presentations included details about Summit of SER Latin Advisors@, which will hold its second annual conference Oct. 9-10 in San Diego. SER is hoping for 150 counselors this year, triple last year's number, according to Ana Trujillo Limón, director of training content and counsel with the Carson Group.
AdvoKate CEO and founder Kate Healy introduced FinServ Foundation mentoring programs, which help next generation talents find easier paths to the profession. The group currently has relationships with 28 universities and around 100 mentees. Grant Rawdin also presented the ways of his Pennsylvania-based firm Wescott Financial Advisory Group DEIB points out.
dIVERSITYPrograms for aspiring counselors began at the University of Akron and have expanded to approximately 25 colleges and universities nationwide, with four virtual programs a year, according to Carina Diamond, CEO and founder of Stella Secunda Partners.
Adams discussed on Financial Alliance for Racial EqualityHis work at career fairs at historically black colleges and universities. The organization aims to increase the number of professionals of color in the financial services industry. FARE includes 10 financial services firms (including Osaic, RBC, Franklin Templeton and Nationwide) and currently partners with five HBCUs.
The financial services industry has been slow to change in terms of diversity, especially at the leadership level. According to in a collection of research from the Equal Employment Opportunity Commission of the Government Accountability Office, 68% of executive/senior management positions in the financial services industry were held by men, compared to 32% for women. 85% of these positions were held by white individuals, compared to 3%, 4%, and 7% for black, Hispanic, and Asian individuals, respectively.
While mentoring can help combat low levels of diversity in the financial services industry, more companies need to emphasize money, according to Lindsey Lewis, a senior director and president at the American College of Financial Services.
Lewis said she heard from many in the industry that women “are over mentored but under sponsored” and firms should be willing to write checks to ensure more people can attend industry events, including conferences like Wealth Management EDGE.
“Mentorship is very important, but (we need) sponsorship,” she said. “What sponsorship means is writing that check and supporting them when they're not in the room.”
Adams noted that advisers from diverse backgrounds may be inspired to bring more financial and retirement planning services to their communities, but with relatively low commission income, they may struggle to do so. made this financial case.
Therefore, it means that advisors in that situation may need to achieve greater success over years of work before doing so. Adams also suggested that when building pipeline relationships with colleges and universities, firms should look to community and two-year colleges, rather than focusing solely on four-year universities.
But sometimes firms want diversity because their clients “want people who look like them,” according to Allan Boomer, a partner and chief investment officer with Momentum Partners.
Boomer warned that this can lead some advisers to believe their only path to success is to land clients from similar backgrounds. He hopes firms show multiple paths to success, not just one that “works with people who look like you.”
“It's too restrictive,” he said. “There are so many talented people our industry is overlooking.”