Why aren’t there more female advisors? It’s a confounding issue for many reasons, not least of which is that there are plenty of female clients and that women seem to possess many of the skills that successful advisors share.
One reason may be the lack of “counterstereotypes,” a concept arising from psychological research suggesting that when a person is exposed to individuals who defy stereotypes he, or she, is more likely to overcome their implicit biases to those individuals.
At a Thursday morning media roundtable in New York, Kim Dellarocca of Pershing delivered the results of a new survey that focused on investors’ perceptions of women and leadership, and how more women can be encouraged to enter industries and professions that are dominated by men, such as financial services in general and the advisor profession in particular.
Dellarocca, global head of segment marketing and practice management for Pershing, revealed that the prominence of women in several popular television shows, such as “CSI” in its various iterations, produced those counterstereotypes in forensic science. While men are overrepresented (as a percentage of the overall population) in scientific studies, in forensic science programs 78% of the students were women as of 2008. At a time when “human capital” is one of the most important factors in advisory firms’ success and in the future of the profession, Dellarocca said that this “CSI effect” could be turned into a “Wall Street effect” that could help attract more women into advisory firms.
However, the Pershing study of 2,000 American adults fielded in January by Harris yielded some paradoxes about Americans’ “complex—and contradictory” notions revolving around leadership and gender roles. The participants by a wide margin said they preferred leaders who evince “more collaborative” leadership styles that included qualities such as listening, consulting and asking questions, compared to the more traditional leadership approaches of “talk, give orders and answer questions.” Again, by a wide margin the participants (even men) said they associated the more collaborative leadership style with women, and said they were comfortable working with women leaders in many professions, including 66% who felt that way about personal financial advisors.
When asked to choose whether they would “be most comfortable interacting or working directly with a man or a woman” in a number of professions or positions of power that are traditionally filled by men, the respondents tended to favor men over women. For example, when it came to president of the United States, 59% of the respondents said they’d pick a man as president if they had to choose. For personal financial advisors, 52% of respondents said they’d choose a man, and 48% said they’d choose a woman.
Breaking down the preference by gender, the numbers shifted. Thirty-nine percent of men said they’d prefer a female financial advisor while 60% of women would prefer a woman. Additionally, the older the woman, the more she preferred working with a female financial advisor. The study found that while 58% of women aged 18-34 preferred to work with a female advisor, the number spiked to 79% among women 65 and older. “That’s the paradox,” said Dellarocca. “Americans say they’re comfortable with women in traditional male roles, but when push comes to shove,” they prefer the traditional gender to fill that role. Dellarocca cited other research that showed that only 20% of advisory firm clients actually work with a female advisor. There’s the rub, said Dellarocca: there aren’t enough female advisors to meet the expressed preferences of female clients at a time when separate Pershing research suggests there will be a shortfall of 237,000 advisors overall in the next decade.
What to Do?
So beyond producing more TV shows that cast female financial advisors in a favorable light, what can be done to attract more women to financial services? Two other panelists at the forum — Regina Meredith-Carpeni, COO of BNY Mellon Capital Markets and Vanessa Weaver, a clinical psychologist and founder and CEO of the consulting firm Alignment Strategies — addressed the issues from their unique perspectives.