Even if women are aware they can pursue a career in financial advice, they’re highly unlikely to do so, finds a new report from financial services consulting firm StrategyMarketing.ca.
The research, which is partially based on interviews with 35 female financial advisors that took place between May and July, found that many women didn’t consider becoming advisors early in their careers.
Female advisors were initially put off by factors such as the industry being male-dominated and the potential for unsteady pay, as well as by their perception that giving advice was based primarily on financial calculations, the report said.
Most of the women interviewed for the report worked in the bank brokerage channel (25.7%), followed by independent brokerages (20%) and insurance companies (14.3%). More than one third (37.1%) had been an advisor for more than 15 years.
The report noted that a separate online survey of recent female post-secondary graduates also yielded sobering results.
Out of the 52 graduates polled by Strategy Marketing in May and June, the vast majority (82%) were aware of financial advice as a career path but only 36% said they would consider advice as a career. The top reason was a perceived lack of skills required for the job (44%), but others simply had a negative view of the industry.
Almost one-third (30.8%) of respondents to the online survey studied business administration, while the rest studied arts (17.3%), sciences (15.4%) and commerce (7.7%), and 28.8% chose “Other.”
The report said women face “systemic” problems in the financial advice industry.
“If the industry wishes to attract and keep more female financial advisors, more has to be done at the front lines to ensure women feel welcomed — because the low numbers of female financial advisors has more to do with archaic gender biases than any lack of talent or will on the part of women,” the report said.
The financial services industry is trying to improve, the report noted.
Organizations are “trying very hard to attract more” women, the report said. “There are ongoing efforts being made to hire more women, including in senior positions.”
The report suggested firms improve their internal programs and resources, and make sure branch managers are engaged when it comes to hiring women.
“All too often at the branch level, there continues to be ineffective practices: outdated hiring practices, lack of support for women in establishing successful practices and male-focused metrics for what success looks like,” the report said.
The payoff for hiring more women could be substantial.
The report noted that April 2020 research from Boston Consulting Group indicated that “women are set to control $93 trillion in wealth globally and reach almost 40% of all wealth in North America by 2023.”
If female investors prefer to work with women, firms may need a higher number of female advisors to capture part of that wealth, the report said.