HOW ARE WOMEN
ADVISORS FARING IN BANK PROGRAMS?
Feature Article
Gina Lauer

Gina Lauer is a contributing editor of Bank Insurance & Securities Marketing. She can be reached at glauer@bisanet.org.

AS MUCH AS the financial services industry has worked over the years to balance the gender gap in its work force, the numbers still show a persistent disparity. Depending on where the figures are gathered, women make up anywhere from 12 percent to perhaps 25 percent of financial advisors.

"Right now, I would say women brokers…conservatively range from 12 percent to 15 percent, depending on the company, so that leaves us very male dominated," says Delia Passi, president and CEO of Medelia, Inc., which provides training and consulting on selling to women. She is the author of "Winning the Toughest Customer: The Essential Guide to Selling to Women."

It's not surprising, then, that a few months ago (July 2009) Morgan Stanley Smith Barney launched an online Women Financial Advisors Forum, a blog for women interested in becoming financial advisors at the firm.

According to the press release, the forum "was developed to offer women Financial Advisors an opportunity to share insights and ideas about the work they do, the clients they advise, and the work-life balance they seek, and to be a useful source of information for women considering a career as a Financial Advisor."

Increasing diversity in the workplace is just one reason for wooing more women financial advisors. Many financial services and securities firms are also realizing that women represent a growing, affluent clientele in need of financial planning and advice.

A force to be reckoned with

"There's a huge transfer of wealth to the baby boomer woman," Passi says.

Women have become a force to be reckoned with when it comes to monetary wealth and managing business finances not to mention the family wallet. In a few short months (officially the year 2010) women will own 60 percent of the wealth in the United States. Other often-cited statistics are that women now represent more than half of the U.S. population and approximately two-thirds of the work force in the country. No only that, about 80 percent, at some point in their lives, will take responsibility for all household financial decisions.

Passi says 40 percent of U.S. firms are now owned by women, and women account for 50 percent of all U.S. stock ownership.

There is another consideration, as well: Women are more than twice as likely as men to choose to work with a female advisor, according to a Women, Money, and Power study commissioned by Allianz Life Insurance Company of North America.

Passi says that wasn't always the case. "About five or six years ago, our research said about 92 percent [of women] had no preference, as long as they can trust them."

She says that shift in thinking likely comes from seeing more women "role models" who can talk about finances in their terms. "I could attribute it to seeing people like Suzi Orman, who are gaining popularity," she says. Passi says another example is CNBC financial journalist Maria Bartiromo.

Women have a 'significant need for these services and oftentimes they seek out women to meet with who can relate to their situation.

—Valorie Seyfert, CFS

Are women advisors a good fit?

If some generalizations can be made here, those interviewed by Bank Insurance & Securities Marketing agreed that women tend to be nurturers, good listeners, and adept at relationship building, all important qualities for bank investment advisors. In addition, those skills are essential in a bank setting where networking and communicating with branch employees can boost referrals.

"Women are motivated to help people. That's why they'd be perfect in the bank financial advisor position," says Passi.

Sandra deChastain, western regional program manager at CUSO Financial Services, L.P. (CFS), agrees. She says a bank or credit union can be "a great environment for someone who just wants to do the right thing for people. Who doesn't want to slam products or just go from client to client, but really want to offer service as a trusted advisor and develop a relationship."

Valorie Seyfert, president and CEO at San Diego-based CFS takes a similar view. "It is a good career, a good match for women, so I hope we see more and more of them. We have some very, very successful women who are top producers," she says.

Seyfert says women have a "significant need for these services and oftentimes they seek out women to meet with who can relate to their situation."

How, then, is bank brokerage faring in the hiring and recruitment of women advisors?

Although it's difficult to pinpoint how many bank or credit union investment reps are women, some of the numbers gathered from several third-party marketing firms indicate the gender disparity may not be as pronounced in bank brokerage as in other channels. At PrimeVest Financial Services (St. Cloud, MN), about 40 percent of reps are women. At CUSO Financial Services (San Diego, CA), the rep force is about 25 percent women. At Infinex Financial Group (Meriden, CT), about 19 percent of the producers are women.

It is also difficult to gauge how those numbers have changed since the early years of bank brokerage when the number of women investment representatives was often thought to be higher than in other channels.

"When the business started out, it was more female-dominated because they recruited from within the bank branches," says Juanita Buss, whose career in the financial services/brokerage industry started in 1963. She was one of the original employees at INVEST Financial Services (St. Petersburg, FL) and continued to work in the bank-brokerage industry until just recently.

"In the beginning, so many bank reps came up through the ranks as originally bank branch managers, CSRs…," says Paul Werlin, president of Human Capital Resources, a recruiting and consulting firm (St. Petersburg, FL).

Werlin says his "hunch" is that the number of women reps in bank programs has probably dropped over the years as bank brokerage has evolved and "lines have blurred" within the industry landscape.

Buss, too, says she thinks there has been a shift toward more male advisors as they realized the potential within the bank branch environment.

Where are the women?

So, why aren't there more women financial advisors in bank brokerage or the financial services industry?

Those interviewed say that it has always been a male-dominated industry, and it will take time for the numbers to balance out.

"I think we have come a long way, and we are seeing more and more women in senior positions within our industry, but it takes time," says CFS' Seyfert.

Amy Beattie, chief operating officer at CFS, says that the number of women advisors within CFS has grown over the past 12 years from "maybe 5 percent" to 25 percent. According to August 2009 figures, 90 of the 364 producers were women. CFS manages more than 130 programs throughout the country.

"I'm surprised to see that high a number to be honest with you. Wall Street, and financial services in general, has historically been dominated by men," she says.

Beattie also gathered statistics on the number of women CEOs at the financial institutions served by CFS. "About 20 percent to 21 percent of the CEOs were women, too," she says—"a similar statistic."

Anne Dunne, community financial institutions director at PrimeVest, agrees that the acceptance level for women in the industry has gotten better. "And I think it's going to continue to get better."

The makeup of a community also has a lot to do with how a rep will fare in a particular bank or branch. While a banker may be open to hiring diverse candidates, sometimes they ask whether a candidate is a good match for their clientele.

'Women like to work with women. I think that as the aging trend continues, more and more of our accounts will be held by women.'

—Catherine Bonneau, PrimeVest

"In the bank brokerage world, there's also a big difference between an urban and more rural marketplace," says Kristine Somerville, executive vice president, southeast regional director, Infinex. "My take is that it's not so much male versus female as it is, "Are you of the ilk of the people?"

PrimeVest President and CEO Catherine Bonneau expresses a similar view. "We look for the absolute best fit for the task at hand and with the credentials that people bring to bear…as opposed to looking at any quotas or personas," she says. "We do recognize those that have the greatest probability of success are those who mirror the client bases that they're serving."

Somerville says her recruiting method is to network with existing advisors or wholesalers. She estimates that about 20 percent of her candidates are women. Her priority, however, is hiring someone with the right skills.

"It's all based on whether you can find someone who's solid, who will speak at the appropriate level to whatever customer they're talking to. It's really about the skills set of a person," Somerville says.

The tally on women producers at Infinex, which partners with about 140 banks nationwide, shows little change from five years ago. In October 2004 (going back 12 months), 18 percent of the producers were women, and 25 percent of the top 20 producers were women. In October 2009 (going back 12 months), 19 percent of producers were women, and again, 25 percent of the top 20 producers were women.

Like Somerville, CFS's deChastain says she doesn't see many women candidates. When she worked as a vice president for a larger credit union, she watched the program grow from two advisors (1 man, 1 woman) to 14 advisors, three of whom were women. "They thrived, and they were doing very well, every one of them."

DeChastain says the firm recruits through various avenues, including job-hunting websites, "and across the board it seems that it's 90 percent dominated by men. So it's rare that we'd have a female applicant."

Still, the statistics show that women advisors have been and continue to be some of the top producers in the industry. Note that at Infinex, 25 percent of the top 20 are women. At PrimeVest, the top producer and No. 4 producer are women. And the No. 1 rep has held that position for three out of the past four years, according to a PrimeVest spokesman.

Women have also garnered high management positions at many of the third-party firms serving the bank brokerage industry. At PrimeVest, three of seven on the executive management team are women. At CFS, including Beattie and Seyfert, eight out of 11 executives at the senior management level are women. At Infinex, two of five in executive management positions are women, and half of the eight regional directors are women.

At INVEST Financial Services, 22 women (plus two team leaders) on the management team are women, or about 65 percent. A company spokeswoman says the company does not track its reps according to gender so she was unable to calculate a male/female ratio for advisors.

How does management account for the relatively high number of women producers at PrimeVest?

Bonneau and Dunne both say that the financial institutions channel has been conducive to women. Financial institutions are relationship-driven, and the advisors are a natural extension of that philosophy.

'Women are motivated to help people. That's why they'd be perfect in the bank financial advisor position,' says Passi

"I think women like to work with women," says Bonneau. "I think that as the aging trend continues, more and more of our accounts will be held by women."

Dunne adds, "The statistics are also showing that women are gaining great and greater control of wealth."

How do you attract more women?

According to Passi, the way to break the barrier is through recruiting.

"Recruiters are generally always male. People recruit people they associate with, they spend downtime with, they network with," she says. "We have to start with the core: That recruiters in his industry need to be trained on how to bring in more women and diverse candidates."

And then, she says, that corresponds to a need for more specific training. "We have to train our workforce to better communicate and work with each other: Gender communication."

She says that women advisors may also need different tools to help them build their business, because training is not "one size fits all."

"Men and women sell differently," she explains. "To be a salesman you have to be able to ask for a close. With men, the close is the climax. To women, it's the relationship building process that is the climax."

But don't recruiters have to be careful not to discriminate against men?

"I don't think that's even a consideration," Passi says. We've been trying for years in the financial services industry—for the last 20 years—to move that needle. It has not changed. It's still at 15 percent."

Should there be an effort to encourage and recruit more women advisors?

"I think there is an effort going on," Dunne says, "But I would suggest that it needs to be a broad-based effort for both men and women to be relationship-driven, to be a trusted advisor.

I think it would behoove the whole industry and the marketplace—and the clients."

Werlin says there has been a change in hiring sentiment over the years.

"If we were talking five years ago, it was very common for my clients to say, 'We're very interested in diversity and we would love to find minorities or women for these positions,'" he says.

Now what he hears more of is that they want someone with a book, experience, good production numbers and a clean record. "Hiring managers want people who can hit the ground running."

Part of that has to do with the state of the economy, but it also has to do with the movement and transition within the industry.

Providing networking

Early on, Raymond James Financial Services, Inc. (St. Petersburg, FL) created "The Network for Women Advisors," a program offering tools and support for its women advisors. The network, formed in 1994, puts on an annual women's symposium and also provides a coaching group, "working smarter" series, and a mentoring program for new financial advisors, according to the company website.

Other financial services and securities firms, particularly in the past few years, have publicized their efforts to recruit and support women advisors. RBC Dominion Securities (Toronto) identified a need for more women investment advisors a few years ago.

"As wealth management becomes increasingly relationship-based, women are well-positioned to capitalize on their expertise in this area," according to David Agnew, national director, RBC Dominion Securities. "We also need to be representative of our clients. Our industry needs more women to reflect the reality that women increasingly manage their financial affairs on their own."

As part of its ongoing commitment to develop its women investment advisors, the securities firm hosted a "Women in Wealth Management" symposium in September 2008.

In 2007, ING Financial Partners launched its Women's Advisory Network to support the practice development of its women reps, and held its first Women Advisors Forum in May 2008. In a news release, Bonnie Reed, vice president of business development with ING Financial Partners, said: "This is not about men versus women. It's about connecting to a community of information, support, accountability and friendship for representatives who primarily are in offices alone."

The need for mentoring

If there is a common theme that connects the women interviewed, it's that mentors played a significant role in their success through the years.

Seyfert says that she and Beattie both had "key people in our lives—and I have to say they were all men—who took us under their wings and acted as mentors to us and continue to act as mentors."

PrimeVest's Bonneau has a similar story. "Very early in my career I had a female mentor who really helped me get going," she says. "And I try to do the same for other people I come in touch with who are really looking to advance their careers."

What obstacles do women continue to face in pursuing a career as an investment advisor?

Those interviewed suggested several factors. DeChastain notes: "Historically the industry has been male-dominated, but there are many opportunities for women. If a person is looking for a predictible, stable income, those positions are typically not available due to the variable compensation structure."

Others suggest that some of the roadblocks might be psychological. "They have preconceived notions of maybe the degree of difficulty, or they [feel] they don't have what it takes," Dunne says.

But the increased visibility of successful women in the industry likely helps to encourage more women to consider a financial services career. "I think there's more and more ways to point out that there are women who have been hugely successful," Dunne adds.

'When the business started out, it was more female-dominated because they recruited from the bank branches,' says Juanita Buss.

There are no simple answers to ironing out gender inequity, but what can help is for firms to re-examine their recruiting and training efforts, implement formal or informal mentoring programs, boost the financial education of the nation's youth, and keep a keen eye on the financial needs and wants of the growing female population.