Earlier this year, Merrill Lynch took the unusual step for a wealth management firm to release data on diversity in its advisor ranks. Now the head of the wirehouse is urging his peers across wealth management to take a cue from the thundering herd and be more forthcoming about diversity in their advisor ranks.
“For too long, the larger firms — including Merrill — have been able to avoid the diversity spotlight. Many promises, good intentions, lots of rhetoric,” Andy Sieg, president of Merrill Lynch Wealth Management, said at the CFP Board’s Center for Financial Planning Virtual Diversity Summit.
The killing of George Floyd and subsequent protests earlier this year sparked a realization at Merrill Lynch that “full transparency was overdue” in terms of the composition of their workforce, Sieg said.
The wirehouse released for the first time demographic data on its roughly 17,500 advisors in
“I hope others will join us,” Sieg said in his presentation.
Merrill’s data shows there are approximately 780 Black financial advisors at the company, and nearly 1,600 who identify as Hispanic or Latino. Women comprise 21% of advisors, while people of color comprise 23% of it.
In terms of hiring over the past 18 months, 54% of the company’s new advisors were women or people of color, up from 39% two years ago, Sieg said. Merrill’s current training class is the “most diverse in our history,” he said, specifying that nearly 30% of the trainees are women and more than one-third are people of color.
Hiring diverse talent is both a moral and commercial imperative, Sieg said, adding that both clients and advisors expect Merrill Lynch to be more representative of the U.S. population.
Merrill Lynch wants to start dialogue on the role gender and race have in the industry, according to Sieg. In August, Merrill released a study that quantified unconscious gender bias taking place between advisors and their clients. For example, the
“Leadership training for advisors lacks an unconscious bias component,” Sieg said, which is “vital” if those individuals are going to lead high-performing diverse teams effectively.
Sieg said that Merrill will release more research by the end of the year that evaluates how race, ethnicity, culture, gender and sexual orientation influences how individuals perceive factors including wealth or legacy.
In closing, Sieg thanked the CFP Board and reminded listeners that Merrill is on the lookout for diverse talent.
“We're eager to add more women, people of color and LGBTQ+ advisors to the thundering herd,” he said.
