Financial services firms are putting significant efforts into their diversity and inclusion strategies as they aim to balance out the ethnic and gender gaps on their advisory teams.
Although many advisors believe that a more diverse workforce is a valuable asset to connecting with clients, others think firms should focus on hiring top talent, regardless of gender or ethnicity.
Advisors surveyed for Investment Executive‘s 2011 Report Card series were asked to rate their firms’ efforts in the “firm’s diversity and inclusion strategy” category for the first time. On average, advisors rated their firms at 9.0 in the category — the fourth-highest overall average performance rating among all the categories in the 2011 Report Cards.
Specifically, advisors surveyed for this year’s Report Card on Banks and Credit Unions rated their firms’ efforts in this area higher, on average, than any other industry channel, with a performance rating of 9.1. The reason is evident in the channel’s advisor demographics, as 45% of advisors surveyed at deposit-taking institutions were women. This is in stark contrast to the results of the Brokerage Report Card: that channel had the lowest average rating in the category, at 8.8, and women made up only 18% of survey respondents.
Still, it’s evident brokers also see the need for their firms to put significant efforts into this area. In fact, many advisors shared the view of a male advisor in Ontario with Toronto-based BMO Nesbitt Burns Inc. : “As a white male, I have had to sometimes make referrals to a female advisor, so it’s definitely what some clients want.”
Vaughan, Ont.-based World Financial Group Insurance Agency of Canada Inc. , Mississauga, Ont.-based PFSL Investments Canada Ltd. , Vancouver-based Vancouver City Savings Credit Union, Toronto-based TD Canada Trust, Winnipeg-based Wellington West Capital Inc. and Toronto, Ont.-based Macquarie Private Wealth Inc. were firms that stood out in ensuring they have a diverse advisory force.
At WFG, diversity and inclusion are built into the firm’s hiring philosophy, says Richard Williams, president of the managing general agency: “We have many ethnic groups in our firm. We have a large group of extremely successful women in our organization.”
Wellington West has also become more proactive not only in hiring female advisors, but at promoting women from within, says Charlie Spiring, chairman and CEO of Wellington West: “We took the glass ceiling off of women about eight years ago … we are getting better and better at this.”
Other firms, such as TD and Macquarie have established task forces dedicated to promoting diversity and inclusion at their firms — especially among women and visible minorities.
Although Toronto-based RBC Dominion Securities Inc. didn’t receive a top rating in this category, the firm has devoted significant resources to encourage its female employees to network in person and online.
In addition to the launch in 2009 of its DS Women’s Advisory Board, a group dedicated to recruiting, training and maintaining DS’s female workforce, DS has instituted an annual symposium for its female advisors that allows them to network with each other and attend guest lectures by female industry leaders. DS also has built an online networking tool for its female employees, through which they can share ideas and network virtually. DS also has a mentorship program for its new female employees.
Despite these efforts, not all advisors feel these practices are necessary. In fact, the average overall importance average for the category across the Report Card series was only 7.8. The reason? A significant number of advisors surveyed say hiring practices should be based strictly on talent, not ethnicity or gender.
Says a male advisor in Ontario with Toronto-based Canadian Imperial Bank of Commerce: “If they are bringing in Martians, that’s fine — as long as they know what they are doing.” IE