According to a 2013 research report by Jersey City, New
Jerseybased securities services provider Pershing, a
subsidiary of BNY Mellon, only 30 percent of registered
investment advisers (
RIAs) in the U.S. are women, who have an even smaller
representation among senior management at the large firms. The
situation is hardly unique to finance of course, with female
CEOs accounting for fewer than 5 percent of corporate chiefs in
the Fortune 1000 and fewer than 17 percent of directors.
Pershing also cites statistics from the U.S. Department of
Labor showing that female advisers tend to work at smaller
firms, in smaller teams and, compared with their male peers,
earn an average of 58 cents for every dollar earned. Pershing
goes on to note surveys indicating that the customer base of
professional women and female-headed households tends to be
more inquisitive and critical in selecting and retaining
Statistical surveys confirm that women are more likely than
men to seek out the services of a financial adviser and more
likely to prefer a female adviser. There is massive opportunity
for female advisers, as evidenced by statistics from the 2013 State of Women-Owned Businesses
Report, commissioned by American Express OPEN, which
estimates that more than $1.3 trillion in sales is generated by
businesses owned by women.
Why have large firms failed to attract more female
When discussing causes for this dearth of female advisers,
industry analysts offer reasons from lack of sufficient family
leave and flextime to ineffective recruiting practices that
amount to little more than lip service within male-centric
I dont think its that they are just paying
lip service to it; I think its that they genuinely
dont know how to do it, says Alexandra Lebenthal,
the president and CEO of municipal bond franchise Lebenthal
& Co., about recruiting women to wealth management.
I think that comes from not having enough women at the
top ranks in the major wealth management firms. [Former
president of global wealth and investment management at Bank of
America] Sallie [Krawcheck] was sort of the only one, and
obviously now she is gone.
In 2007 Lebenthal relaunched the firm her grandparents
founded in 1925 after buying the name back from Merrill Lynch.
Initially focusing on building up the firms capital
markets franchise with a strong presence in bond and equity
underwriting, she has expanded the focus into wealth management
and services for family offices. Lebenthal believes women are
more likely to join an industry if there are female role models
and if a woman reaches out to them. Many firms are simply
throwing their hands up and saying, Yes, we want to hire
more women professionals, but we dont know how to get
For companies like Lebenthal, the larger firms failure
to adapt provides a recruitment opportunity. We are
initially focused on female advisers who are already in the
business, who are at firms that leave them feeling that they
are second-class citizens and where they are one of only a
handful of women professionals in a gigantic branch
Lebenthal is not alone in focusing on recruiting more women
to join their advisory practices. Private
Ocean, a San Rafael, Californiabased wealth
management firm that oversees nearly $900 million in client
assets, has recently stepped up its recruitment of women.
According to firm COO and partner Susan Dickson, this also
helps with marketing to the growing number of households that
have a woman as the primary income earner. Women of prior
generations still preferred male advisers, she says.
Younger professional women today are much more likely to
respond positively to working with a female adviser.
Unlike leaders of other firms, Dickson and her colleagues
have focused not only on advisers with existing practices but
also on those interested in transitioning from careers in
corporate or other professional roles. Dickson has firsthand
knowledge of such a career trajectory. She entered the
registered investment advisory field in 2005 after decades
spent as an executive in the aeronautics and consumer
discretionary industries. We are still very light on
strong women advisers in the industry. Finding top female
talent in other sectors is a great way to find talented
recruits, she says.
The industry generally agrees that female advisers will have
competitive advantages in the coming decades as the
demographics of U.S. wealth shift. Pershing, in particular, has
been active in bolstering the number of female RIAs. The firm
has published several white papers and hosted seminars intended
to encourage RIA clients to refine recruitment strategies.
Today more women than men are graduating from college.
That is going to profoundly change the industry, says
Mark Tibergien, CEO of Pershing Advisor Solutions, a Pershing
affiliate. Tibergien sees it as an opportunity both for firms
and new financial advisers. This is an opportunity for
[new hires] to be intellectually stimulated, have a high degree
of independence, profoundly impact the lives of their clients
and put a whole new face on the way the business is
managed. On a personal note, Tibergien says he will
encourage his nieces to consider careers as RIAs when they
graduate from college.