With McKinsey projecting that women will control approximately $34 trillion by decade's end, gender diversity in advisory firms has shifted from being a "nice-to-have" to a critical success drive.
The amplified need for more female representation in RIAs is clear: Those who understand the unique needs of female clients and authentically connect with them will reap the rewards of the great wealth transfer.
The financial advice sector is undoubtedly making strides toward
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But significant gaps remain. According to a Deloitte study, women filled just
The Deloitte study raised two other concerning trends. First, many of the executive positions for women are "nontraditional" — ones that have been created in the last 20 years, such as chief digital officer and chief sustainability officer — as opposed to traditional C-suite roles like CEO, CFO or COO.
Second, women's representation in "next-generation" roles — i.e., manager or equivalent titles below senior leadership — have grown at a much slower pace than that of women in senior leadership positions. If this trend persists — and the Deloitte study projects this downward trend will continue through 2031 — it will reduce the pool of eligible female candidates for senior positions, widening the leadership gap.
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From mentor to sponsor
There are many strategies that RIAs can deploy to create and nurture a gender-diverse pipeline and build upon existing foundational efforts. Mentorships and sponsorships are two such approaches, but there are
In a mentor-mentee relationship, the mentor offers valuable knowledge and guidance to the mentee. A mentor evolves into a sponsor when they take tangible actions to advance the mentee's career, for instance exposing them to individuals in influential roles in their firm and in the advisory sector at large.
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Here's an example of the power of sponsorship I know of firsthand. When a female C-suite executive learned her firm's board of directors was considering asking a male executive with an outgoing personality to join them on the golf course, she countered by advocating for a female colleague — an
The sponsor's intervention resulted in her mentee being chosen to golf with very influential board members. The woman executive's verbal advocacy opened a door that exposed her mentee to opportunities she otherwise wouldn't have had and brought a new perspective to the board and C-suite executives — a win-win-win.
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When fostering gender diversity, it is important that female executives like the one above are seen and heard. Formally, this could mean inviting women to be company spokespersons, selecting them to lead key committees and nominating them for prestigious awards. Informally, it might involve including them in decision-making and respectfully listening to their perspectives on policies and procedures.
When women hold prominent positions of authority, it inspires others and introduces a wealth of diverse perspectives that can enrich decision-making and drive innovation.
Establish goals and publicize them
Setting
Another impactful tactic is to use gender-neutral language in job descriptions and avoid phrases that discourage female applicants. Focusing on skills and competencies versus years of experience will lead to more qualified candidates, eliminating preconceived gender bias, which can tend to favor men for financial roles.
Finally, when recruiting for executive roles, aim to attract a diverse slate of candidates, with a healthy balance of male and female candidates.
Send co-ed delegations to women-focused conferences
Perhaps one of the best ways to enable firm members to gain meaningful insights into building a gender-diverse workplace is to send both male and female delegates to
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This benefits women in terms of networking, information-sharing and learning from their peers. It can also open the doors to development opportunities for building leadership skills, expanding networks and gaining knowledge to navigate the unique challenges they may face in the financial industry.
Encouraging male attendance at these events creates opportunities for them to witness powerful, accomplished women in action, showcasing their knowledge on key industry trends that can solve real business issues. Such gatherings can also offer men tangible takeaways they can put into practice to support their women peers for their mutual benefit.
Another way both males and females can make meaningful strides in closing the gender gap is to partner with organizations promoting women in finance, such as the
By encouraging sponsorship, taking proactive steps in recruitment, mentorship and leadership development, RIAs can improve gender diversity — which should ultimately benefit both the firm and its clients. Championing diversity helps create a stronger, more resilient financial services sector.
That opportunity is too important to miss.
