Practical (And Profitable) Ways To Attract Women Advisors
Written by Kay Lynn Mayhue, President | Article originally appeared in FA-Mag.
Something’s amiss in the financial advice business, and the data confirms it: Women account for only about 15% of the financial advisor population, according to McKinsey & Co. They account for only 23% of CFPs.
Since research has shown that diversity on our teams, just like diversity in a client’s portfolio, produces better results, why is the needle moving so slowly? Why is it taking so long for firms to attract and retain more female advisors, and what can be done about it?
The industry has made great strides in recent years in recognizing this imbalance and trying to change it. As those industry-wide efforts continue, firm owners and partners can also do their part. We’ve come up with some steps at our own firm, Merit Financial Advisors, that we would like to pass along to you to help make your firm more appealing and rewarding to women.
Something’s amiss in the financial advice business, and the data confirms it: Women account for only about 15% of the financial advisor population, according to McKinsey & Co. They account for only 23% of CFPs.
Since research has shown that diversity on our teams, just like diversity in a client’s portfolio, produces better results, why is the needle moving so slowly? Why is it taking so long for firms to attract and retain more female advisors, and what can be done about it?
The industry has made great strides in recent years in recognizing this imbalance and trying to change it. As those industry-wide efforts continue, firm owners and partners can also do their part. We’ve come up with some steps at our own firm, Merit Financial Advisors, that we would like to pass along to you to help make your firm more appealing and rewarding to women.
Advisor compensation has traditionally been tied to closing new clients, while the work of serving and retaining current clients has often taken a back seat. Yet the retention of long-term clients is the key to a firm’s success and profitability. With that in mind, we have created dedicated advisor teams that focus solely on client service. These teams regularly check in with clients and answer questions that may come up.
So how do you create a compensation plan for these teaming strategies?
We do it in a variety of ways at Merit, so our advisors can pick a compensation scheme that suits them best. For example, some advisors want a straight salary. Others might want their paychecks to be variable, depending on how well they perform. Still others might like getting paid both ways.
In part because of this team approach, women represent more than 53% of the 140 employees at Merit, and their numbers continue to grow.
Flexibility Is Key
Our team structure also allows us to be flexible with working hours. In addition to our generous personal time-off policy, we are very accommodating to our staff members’ personal needs and sensitive to their need for work-life balance. It’s important to understand that many people are responsible for childcare, and they also often care for older parents and relatives. Typically, this responsibility falls on women, so we support flexibility, which we find is rewarded by higher productivity, loyalty and retention.
Lead By Example
It’s one thing to create these changes, but firm leaders must also live them. I have five children and often take time during the workday to participate in their important school events. Other women see that I respect, understand and appreciate the role a parent plays in a child’s life, and when I take time to do things with my children, it gives my staff the confidence and security to do the same.
Male allies are also important. My partner, CEO Rick Kent, continues to support and advocate for women in our firm and in the industry. He recognizes and appreciates that we will attract more women to our profession if we rethink the way we approach our business.
Invest In Them
Most women want to continue fine-tuning their professional skills and appreciate it when their firms offer training and leadership programs to help them do so. Recently, we launched a leadership development program that came as a direct ask from our female leaders. We now offer coaching and training in a variety of areas and envision this continuing to act as a wonderful added value for our female team members.
Women play a key role in a firm’s current and future success. By offering flexibility and training and by differentiating roles among professional specialties, our firm has attracted outstanding women and others who probably never would have considered a career in financial advice in the past. By broadening our concept of advisor success, our firm has benefited immeasurably from their contributions. Your firm can too.