BY JULIA ANDERSON
Here we are in the 21st Century, where half the jobs in this country are held by women, yet only 17 out of every 100 people working in the U.S. financial services industry are female. Why is that?
Among a short list of reasons --- men like Ken Fisher.
Fisher managed to embarrass himself and do damage to his $110 billion investment empire by saying, among other things, that client acquisition is like “getting into a girl’s pants.” He said other crude stuff but it’s not worth mentioning here.
So far, Fisher Investments has seen $1.8 billion pulled out of the firm by those uncomfortable with his off-color sexist remarks made at a recent financial industry confab. Fidelity, the giant Boston-based asset manager, is among heavy-hitters who are taking their business elsewhere because of Fisher’s “inappropriate comments.”
Women who have been around the money-management industry, say they’ve heard this kind of talk before from top executives who think they are God’s gift to the universe. So, it is no surprise that despite industry efforts to recruit women, the diversity numbers remain flat, reports Cerulli Associates.
The low ratio of about 20 women out of every 100 working in the industry is unchanged for the past 20 years. For the past 20 years!!!
What bugs me is that women -- both as employees and as clients -- are patronized by the wealth management business that until lately has been powered by a macho sales-driven culture.
According to Barron’s, women represent only 4 percent of top executives at mutual funds, hedge funds and other investment vehicles. They control just 1 percent to 3.5 percent of fund assets under management, Harvard Business Review says.
Yet, women outnumber men in the general population (51 to 49 out of every 100). Women receive the majority of college degrees in the U.S. with 66 million women collecting a paycheck. Seventy-three percent work full-time.
But according to Investopedia, “finance and business degrees remain the province of male students.” Sixty-one percent of college degrees in finance are awarded to men. That may explain why 46 percent of financial services jobs are held by women but only 15 percent work at the executive level. (Forbes)
Meanwhile, banks and investment services rank low in public opinion. We can blame some of that on the Great Recession. Banks lied and cheated, right? And on the industry’s image as a cut-throat, sales-driven, slick con-artist business perpetuated by movies such as “The Wolf of Wall Street,” “The Big Short,” and “Wall Street.”
Add to that more recent data breaches at large banks and credit card service companies such as Capital One, falsified accounts at Wells Fargo and misogynist comments from people like Ken Fisher.
There are more reasons why women are not attracted to the financial services/investment industry.
The industry has not gone onto college campuses offering an attractive recruitment and clear career path for women.
Few senior industry executives are women. That means less leadership emphasis is placed on recruiting women. (Only 12 percent of CEOs of large financial firms are women.) At every level, men are promoted at materially higher rates than women, reports the Harvard Business Review.
Until lately, the financial services industry has been a commission-alone business. Sell or starve. This creates an inherit conflict of interest between clients and their self-described financial advisers. Women may find more repugnant than men.
Unconscious bias and gender-role expectations still disadvantage women. That’s because middle management at banks and brokerage firms are is filled with older white males who set the culture despite diversity efforts dictated from the top.
If there’s good news out of the Ken Fisher debacle it may be as a catalyst for industry-wide change.
What would that industry change look like?
Review your culture: Executives should review their own conduct and the culture of their firms to make sure they are not guilty of some of the same misbehavior displayed by Mr. Fisher, suggests Investopedia writers.
Promote women: Move more women into middle and top management positions that show the way for women newly recruited to the business.
Make jobs family-friendly: Initiate flexible hours, parental leave and mentorship programs that help women stay with the job and see opportunity for advancement.
Recruit outside the box: Open industry recruiting to non-traditional candidates. Do you really have to have a business or accounting degree to be a financial adviser? Nope.
Reach out early: Get girls interested in investing in high school when many are choosing a career path. Bring more women into college business schools. Make them aware of opportunities in the financial world.
Girlswhoinvest.org is doing just that. You can donate to their cause.
The fact is that women control more than half of U.S. personal wealth either through inheritance, a late in life divorce, death of a spouse or through business ownership and personal investment.
According to Wealth Management RBC, by next year (2020), that total will reach $72 trillion!!
Women have the power -- from the inside and from the outside -- to change the wealth management and financial services industries by spelling out what they expect in terms of transparent services, industry culture and attitude and open accountability.
Women recruited to the industry will be perfectly positioned to deliver on all fronts with a different skill set – empathy, intuitiveness and listening.
Thank you, Ken Fisher, for making it clear why things must change.
Why Are so few Women in Finance? It's Complicated - Investopdedia
I meet women all the time who face job and money transitions and who want to do them right. It’s about building confidence and taking charge of the future. This is your money. No one cares more than you do!
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