This publication continues to examine women in wealth management, and how firms are looking to improve the issues surrounding female advisors and clients.
(This is a repeat article from last Thursday's edition of our sister publication WealthBriefing)
A few days after last week's International Women’s Day, debate about how far women have come in the wealth industry continues. Figures in the industry show they have made strides but there's still big room for improvement.
Dividing lines between male and female wealth managers remain. For example, Barclays said female employees at Barclays International, which houses private banking, earn on average 48 per cent less than their male counterparts. And according to a study by analytics firm Cerulli Associates in January 2017, women represent only 15.7 per cent of the 310,504 financial advisors in the industry across the US, a country where one might assume the situation of women was more advanced.
But there are some firms who are trying to equal the playing field, including Royal Bank of Canada, which signed up to the Women in Finance Charter in March 2017, in a bid to promote gender equality across its workforce as well as the wider financial services industry.
This publication sat down with RBC Wealth Management’s Ross Jennings, head of sales and relationship management across the UK and British Isles, and Katherine Waller, director based in London, to discuss such issues.
“As a headline statement: there are not enough women advisors in wealth management,” said Jennings. “There is clear evidence to suggest that above a certain age female clients want to be looked after by a female advisor. But this presents an issue for our industry as the pool of women coming into wealth as a career is not as high as it should be and there is an equalisation that needs to happen. I don’t know what the drivers are that are keeping women away but our industry needs to look at the factors as to why they are not coming in."
Jennings, who has been with the firm since November 2010, continued: “At the moment our book of clients is broadly 60 per cent male, and 40 per cent female, across all of our individual accounts. I think to have a nearly 50/50 split in clients; you need to have a broadly 50/50 split in relationship managers, as it makes sense.”
Many firms are starting to tackle the lack of women in the sector by equalising the numbers of male and female relationship managers. Julius Baer, for example, boasts a 41.2 per cent ratio of women/men at the entire company, as reported by this publication. However, according to the Women in Financial Services report by Oliver Wyman in June 2016, at the current rate of progress, it will take another 30 years for executive committees in the financial services industry globally to reach 30 per cent female representation.
Both Jennings and Waller discussed the benefits of working as a team at RBC WM, with teams featuring both male and female relationship managers.
“I think wealth management has changed at a rapid pace,” said Jennings. “Since November 2016, around 45 per cent of our new hires at the relationship manager level have been women. We also think about client-facing support as well, and that number does go up to around 50 per cent of both male and female hires. We believe in the trend, so let’s keep a balance between the two rather than going one way or the other. We ensure our clients are well supported, maybe by one male and one female relationship manager. You are able to hedge your position with a team-based approach. And in an ideal world, you would want coverage from both male and female advisors within each team.”
Waller, who joined in 2012 from HSBC Private Bank, said: “Having a team approach gives the client more consistency. The continuity of a team supporting a client is really important. Having both genders and multi-generations working in a team really helps the client. For example, when I was off on maternity leave, I knew my clients were very well looked after by members of my team.”
There are clear benefits to a wealth management firm in winning new business by having a diverse staff range. In 2017, CFA Institute found, during a study called the Value of Premium Wealth Management, that in North America, ultra-high net worth clients are looking for advisors that both have skilled expertise, but also have “emotional intelligence” to understand their clients’ needs.
And Jennings feels this is what more female relationship managers can add to the industry, and speaks about the different qualities women have to men within the sector.
“I think women are better at the emotional wealth management
approach, and I sit here as a man and I can admit it,” said
Jennings. “A lot of the ingredients for emotional wealth
management are empathy and caring, and having time for clients.
And women tend to do that better than men. In my experience,
female wealth managers can be more tactfully audacious when
dealing with male clients; they can ask questions that a man
would never ask another man. It is a real point of
differentiation, and we sometimes overlook that. One of the
things we encourage people to do is shape their thinking, and
sometimes that means asking the more difficult questions, which
women seem to handle better.”