A Common Refrain Walter Booker, Chief Operating Officer of MarketCounsel, often hears from consultants that they would like to hire people of color, but they fail to find talent. Still, people of color made up a third of the US population, and 80% of financial advisors on the RIA channel are white men, he said.
“You have to ask yourself, ‘If you can’t find a third of the population, where are you looking?'”
During a panel discussion at the Morningstar Investment Conference, wealth management executives said the industry diversity problem was not due to a lack of talent; There are many highly skilled, non-white, non-male finance professionals out there. Consultants just don’t do a good job of finding them and then keeping them.
“The goal is not to perpetuate what we have,” said Booker. “That is not sustainable. The goal is to continuously create something new, different and better, and that means being open and moving forward proactively, on purpose, on purpose and with a very clear direction.
Mark Tibergien, former CEO of Pershing Advisor Solutions and independent director of Pathstone, a $ 20 billion multi-family office and RIA, said the industry is not very good at developing a human capital strategy.
“If there’s a talent shortage, it’s because you didn’t really care about how your brand was positioned in the marketplace. This also includes addressing various candidates, but candidates in general. “
Many companies have made no effort to value diverse contributions and create career paths for individuals.
“Without a framework for how you can attract more people to your company and then keep them, it makes it very difficult for companies to influence diversity,” said Tibergien.
He adds that there is a capacity problem rather than a talent shortage.
“The number of active relationships a consultant can manage is physically limited. So if you don’t increase capacity, you limit your ability to grow, ”said Tibergien.
The industry should also be aware of the rough assumption in the recruiting and networking process that customers only deal with people who look like them. Tibergien cited the example of former LPL advisor Eileen Cure, who allegedly told her staff that she did not want to interview black candidates.
“I think for the most part people are looking for competence,” said Tibergien. “The greatest humiliation is the tendency to underestimate people.”
Finding white male advisors is pretty easy, said Rianka Dorsainvil, co-founder and co-CEO of 2050 Wealth Partners, a virtual, paid, comprehensive financial planning firm. But consultants have to be willing to get involved to find more diverse candidates, and that takes time.
“Diversity, equity and inclusion will not be a short-term game,” she said. “It’s going to be something that has to be in the long run.”
To do this, the consultants have to expand their network; Dorsainvil suggests attending conferences that you would not normally attend, such as the Association of African American Financial Advisors, and recruiting from historically black colleges and universities (HBCUs), many of which have CFP registered programs. Get involved in the Financial Planning Association’s Knowledge Circles, which are special groups for different communities, she said.
“You can’t have the excuse to say, ‘Well, I can’t find black and brown talent,'” she said.
Another common topic when it comes to diversity in the financial services industry was brought up by the panel discussion: Some white, male advisors often feel threatened by the discussion. Tibergien referred to a recent Twitter response to Dorsainvil promoting the Morningstar panel. A white consultant named Theodore Beza wrote, “Diversity, Equity, Inclusion: The Holy Trinity of Corporate Wake-ism. We who have worked in the corporate world know what “diversity” really means when we hear it – “white men go to the end of the line” # anti white”
“It’s sadly a mindset that people think we’re talking about a lack of opportunity, rather than an abundance of opportunity, and that they are somehow being weeded out, just as white men have weeded out people of color and women for so long. as a form of discrimination, ”said Tibergien. “I think we need to understand a fundamental principle in financial services, which is that there is an overabundance of customers and an overabundance of opportunities and an under-supply of people who offer them.”