Aside from Sheryl Sandberg’s sensational Lean In initiative, recent stats on the projection of women’s economic gains as individuals and contributors to households have prompted the financial industry to examine their approach in reaching female clients and developing their own employees. In the US, women currently control $14 trillion in personal assets, and this amount is expected to reach $22 trillion by 2020. In addition, they are the primary breadwinners for 40% of American households, which inadvertently gives them more power to control household investment decisions. Despite that women’s economic power is on the rise, the number of female financial advisors is astonishingly low and disproportionate to the gendered wealth demographics. According to kasina’s Advisor Insights Q2 2013 Benchmarking Report, female advisors, on average, make up only 17% of advisors across all intermediary channels. However, 70% of women investors prefer to work with female advisors.
As such, companies are devising programs to add and promote women in their work force. Asset management firms like JP Morgan, PIMCO, and BlackRock have leadership networks and recruitment programs to support female employees and develop their skills. While it is wonderful that major firms are taking the “lean in” concept seriously, I wonder, is it as simple as meeting staffing and promotion goals? Is leadership cultivated purely through skills training? What other challenges should asset managers consider?
I recently read in the Harvard Business Review that most organizations fail to understand that developing women leaders requires fleshing out what leadership skills actually mean and creating an environment that affirms these skills. For instance, while being outspoken and gregarious might be perceived as skills for wholesalers, a female wholesaler who is attentive and processes information in quiet manner may be much more successful in client relationship management, especially in working with female investors. This means that asset managers need to re-evaluate the skills that they look for in employees they want to hire and promote, and how those skills achieve various goals within an organization, which may not be obvious. Without examining and redefining success factors for managing an evolving clientele, the burden for women to lean in at asset management firms based on normative skills is demoralizing and counterproductive.
Furthermore, firms cannot just design programs to support the advance of their female employees without incorporating their male counterparts. Company culture is integral to the success of women becoming leaders, as leadership is an identity that needs to be affirmed in order to be sustained and cultivated. Therefore, asset managers must design programs that do not segregate but engage participants firm-wide to recognize how different skills align with different goals to promote leaders for investment management.