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What You Need to Know

  • Industry executives, including white men, are more willing to discuss topics previously considered taboo, Sonya Dreizler says.
  • D&I work is the right thing to do, but it's also the future, says former DT Ameritrade executive Kate Healy.
  • DE&I is about creating opportunities for people to connect and activating coaching and mentoring networks, Gabe Garcia of Cresset Capital Management says.

The financial services industry is embracing the push for diversity and inclusion as never before, though lots of work remains for the sector to more adequately represent the people and community it serves.

This is the general view of the judging panel for ThinkAdvisor’s LUMINARIES, a groundbreaking program to recognize individuals, firms and programs working hard to move the wealth management industry forward in terms of its diversity and inclusion, as well as in three other areas (thought leadership, executive leadership and deal-making/growth).

Though more than half of the U.S. population is female and women control one-third of household assets (more than $10 trillion), only about 1 in 5 financial advisors are women, according to Cerulli data. The figures are much lower for Asian, Hispanic and Black advisors. 

“After the #MeToo movement, the public focus on anti-Black racism last summer and anti-Asian racism this year, I’ve noticed that industry executives including mostly white men have a much greater willingness to have conversations around topics previously considered taboo,” said Sonya Dreizler, an industry speaker and writer, as well as the head of the consulting group Solutions With Sonya. 

“What I’d like to see next is moving from conversations and pledges to measurable commitment and action on pay equity, hiring and retention, as well as more intention around who we listen to,” Dreizler added.

‘Crossed the Transom’

Gabe Garcia, head of corporate development for Cresset Capital Management, believes the industry has “crossed the transom of awareness; but there is still much work to do, so this does not become a ‘check-the-box’ item for corporate responsibility, and instead is actually a cultural cornerstone.”

For Garcia, “It’s heartening to hear the conversation happening in our profession. It starts first with awareness, then creating real curiosity and introspection, and then true engagement and change.” 

D&I work “is about pursuing progress before perfection,” according to Renée Baker, head of Private Client Group Advisor Inclusion Networks for Raymond James. The industry has recognized the importance of these issues, Baker explained, “and the key difference I’ve seen is the intentionality and focus on a [well-]thought-out D&I strategy — and working alongside each other to measure accountability.” 

Firms across the industry “continue to see encouraging results with new advisor training programs and pipelines, signaling great progress on recruitment efforts,” she added.

In addition, “I’m also seeing a more human approach when addressing racial inequality in the industry. Self-education and additional resources are available, more than ever before,” according to Baker.

Future Steps

To further move the D&I needle in the industry, further collaboration is required, she said. “Together we can change how we hire and cultivate diverse talent especially if we want to attract and, more importantly, retain this talent in financial services.”

Industry players “need to remain intentional about creating a more inclusive firm,” according to Kate Healy, a longtime industry veteran and former TD Ameritrade executive. The industry “cannot let the recent awareness fade away,” she added. 

“Diversity, and more importantly, inclusion, need to be part of a firm’s strategy for future growth. That means not just hiring diverse talent, but creating a firm that is in a constant growth mode,” Healy explained.

This growth should include better understanding of other cultures and their thoughts about money and advice, developing diverse talent and “becoming more inclusive and providing opportunities for different voices to be heard,” she said. 

While D&I work is “the right thing to do,” it’s also the future, she said. “Shifts in demographics, family structures, the challenges of student loan debt, the gig economy and cultural preferences have changed the way and type of advice needed. Financial planning needs to be more diverse to appeal to more clients and prospects.”

Mentoring Matters 

There are several drivers of D&I, Garcia said. “Diversity is fundamentally necessary to reflect the world we serve. Equity and inclusion is about changing the conversation, creating real opportunities for people to connect, and activating networks for coaching and mentoring.”

The former E-Trade executive has “had the benefit of experiencing both sides of this issue,” he explained. “My personal experience of having a mentor see the potential I had and proactively create opportunities for me to succeed has had tremendous influence.” 

Successful mentoring is about taking an interest in an individual and seeing that person as a professional, according to Garcia. In his experience, it’s been “about breaking down barriers to allow me to grow and be exposed to opportunities that required me to be capable and competent enough to accomplish,” he explained. 

“As my mentor shared on many occasions, ‘The greatest indignity we can bestow on someone is to underestimate them,’” he added.

To broaden the impact of the industry’s D&I efforts, Garcia said, “We need broad participation, activating at all levels of an organization, to become more self-aware and effect cultural change.”

Other Steps

Since many finance careers are interesting, engaging and well compensated, these roles should “be available to anyone who has the skills and desire to do them,” Dreizler explained. “It’s the right thing to do, and it will make our companies and industry stronger and more prepared for the future.”

She sees “a tremendous amount of opportunity in both media and conferences to lead the way to a more inclusive and diverse financial services industry, because both of these platforms serve as industry ‘gatekeepers’ of the voices that we listen to.” 

This effort requires “intentional networking reaching beyond our existing, largely homogenous, circles to find new voices and perspectives,” she explained. And it’s a step that can be more widely embraced and followed by the broader industry as well.

(Image: Adobe Stock)