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November 25, 2019 at 09:00 AM
A typical fireside chat at an event in October quickly turned into a firestorm after billionaire investment advisor Ken Fisher made crude remarks that have sparked a renewed discussion on the treatment of women in financial services.
In the weeks following the incident, industry leaders and many others have spoken out about such bad behavior, some $3.4 billion of Fisher Investment’s $115 billion of assets reportedly have flowed out, and a growing number of organizations are putting codes of conduct in place to prevent such behavior.
See A Timeline of the Fallout from Fisher’s Crude Remarks.
The industry seems to have reached a tipping point in gender issues, as news stories tied to the Fisher matter continue to dominate headlines and water-cooler conversations.
To best evaluate the prospects for meaningful change in the industry’s treatment of women, we spoke with business leaders and other participants and conducted an exclusive advisor poll on Fisher’s behavior and broader gender-related topics — the results of which are highlighted here.
First, What Happened
Fisher Investments’ founder and chair had made crude remarks before. But this time — on Oct. 8 at the Tiburon CEO Summit — was different.
Early the next day, conference attendee Alex Chalekian reacted to them in a video posted on Twitter, which quickly went viral. He described them as “a true debacle. It was horrible.
Things that were said by Ken Fisher were just absolutely horrifying.”
Chalekian, head of Lake Avenue Financial and RIA Integrated Partners’ practice acquisitions, said Fisher referred to “genitalia, … picking up a … girl, …. Jeffrey Epstein, … and [made] other inappropriate comments at the conference.”
He and others at the event were “disgusted by this, and many of the women expressed to me that this is why they don’t like coming to these conferences. It makes them very uncomfortable. And this obviously doesn’t help the situation.”
In the remarks, Fisher described prospecting for new clients like “going up to a girl in a bar … going up to a woman in a bar and saying, ‘Hey, I want to talk about what’s in your pants,’” according to an audio recording obtained by CNBC.
Rachel Robasciotti, founder of wealth manager Robasciotti & Philipson, was one of less than 20 women among the 220 guests at the Oct. 9 event. “I sat in the audience stunned by what I was hearing,” she said in a blog post (and on television).
“When you are on stage, you’re there because others want to learn from you … ,” Robasciotti explained. “When your description of the world uses women as sexual objects and refers to employees as if they were cattle, it has an impact on real people in and outside of the room.”
Sonya Dreizler, founder of the impact-investing consulting firm Solutions With Sonya and another conference participant, also spoke out: “Since this content is not about business issues, I’m choosing to break [the event’s] code of privacy to confirm that the comments from the stage were indeed outrageous.”
Fisher also made crude statements at an event in 2018. “There were similar comments to what Alex [Chalekian] referenced about advances towards women and just some sexual comments that you could tell the audience was uncomfortable with. And there were comments afterwards about how they could not believe … what [Fisher said],” according to advisor Justin Castelli of RLS Wealth Management.
Equally unbelievable to some have been Fisher’s responses to the recent remarks. After seeing Chalekian’s video, Fisher first said in a statement: “While I said most of the words he cited, he wasn’t hearing the context of what I was communicating and seems to have misconstrued its essence — certainly misconstrued my intended meaning.”
He added: “The rest is just nonsense. … To the extent he or others in that large crowd were offended, I apologize most sincerely.”
Fisher told Bloomberg: “I have given a lot of talks, a lot of times, in a lot of places and said stuff like this and never gotten that type of response. Mostly the audience understands what I am saying.” Still, he added, “I regret I accepted that speech invitation because it was kind of a pain in the neck. I wonder if anybody will be candid at one of these Tiburon events again.”
A more official apology was issued on Oct. 10: “Some of the words and phrases I used during a recent conference to make certain points were clearly wrong, and I shouldn’t have made them. I realize this kind of language has no place in our company or industry. I sincerely apologize.”
Nearly a month later, though, the firm returned to its defensive stance. “Any fair account … would acknowledge that Ken used the language he did to underscore how some advisors … behave in pushing their services on prospective clients. Given most people’s privacy about their financial life, aggressive sales pitches are the equivalent of a crude come-on in a bar.
His point was, that’s no way for a financial advisor to behave,” according to John Dillard, the firm’s head of global public relations, who spoke recently to the Los Angeles Times.
Ironically, Fisher’s firm has been accused of such behavior. Since 2016, 125 individuals have filed grievances against Fisher Investments with the Federal Trade Commission, Bloomberg reports.
The firm’s “hardball” tactics include marketing phone calls, spam emails and impersonations of supposed friends, co-workers and government officials. In September, Fisher told ThinkAdvisor the firm spends some 6% of revenues on marketing.
“The firm itself, and Ken to a certain extent, has a reputation in the industry that rubs people the wrong way,” said Kirsten Plonner, communications chief of FiComm Partners. “People [have] turned a blind eye, and he’s known for making off-color remarks; there’s nothing illegal or criminal about that, except [on Oct. 8], it really struck a nerve in a big way.”
Advisor Reactions
Poll data collected by Investment Advisor/ThinkAdvisor support Plonner’s conclusion. In addition, the survey results point to a strong consensus on bad behavior in the industry and how to respond to it, though there is less agreement on how widespread the problem is.
• The majority of financial professionals polled believe Fisher’s off-color remarks were sexist/highly inappropriate, garnering 70% of the 1,350-plus responses overall — with 85% of women and 65% of men expressing this view.
• Even stronger is the consensus view over withdrawing assets from Fisher Investments as an appropriate response to his comments: It has the approval of 86% of responses (92% of women’s/83% of men’s).
• When asked if these redemptions send a clear message that his behavior is unacceptable, 88% of those taking the poll (91% women/87% men) say “yes.”
• A strong majority, 84%, view Fisher’s banning from two industry events (where he’s made lewd remarks) as an appropriate response, and 75% would not attend an event with Fisher as a speaker.
• The consensus, though, breaks down over the frequency of behavior displayed by Fisher and others. Most women polled, 61%, say such behavior is common in the industry vs. a minority of men, 30%.
• As for initial reactions to the specific comments made by Fisher, 47% of men were shocked/disgusted vs. 39% of women. Some 38% of women found the remarks unsurprising vs. 26% of men. (Others were either surprised or not shocked/disgusted.)
• Concerning the general problem of verbal harassment in the business, 80% of women say it is somewhat or very common vs. 48% of men.
• In terms of physical harassment and its frequency, 59% of women believe it is somewhat or very common vs. 27% of men.
