Among the challenges facing the financial services industry, one stands out to me: a historic inability to attract and retain diverse talent.
In a country growing ever more diverse, where investable assets are spread more evenly across demographics every day, it is essential to have a workforce that represents our communities and provides clients the opportunity to work with advisors who share their experience, who can empathize with their life stories and goals—and, put simply, who can identify with them.
Only 24% of financial services employees are minorities, according to the 2018 Securities Industry and Financial Markets Association (SIFMA) Diversity Survey. Those stats are even worse for the wealth management business, for example, the survey shows, where minorities represent only 12% of financial advisor roles. African Americans and Hispanic Americans are particularly underrepresented in financial advisor and other professional roles, despite their growing relative percentage in the working-age population.
These are stubborn realities, but they are not intractable if we aspire to change these realities in wealth management—and we should! We must actively encourage new faces to join our industry.
At RBC, one way we’ve found to successfully encourage people from diverse backgrounds to consider a career in financial services is by shining a spotlight on the incredible, diverse talent that we already have in our ranks. For instance, we just launched a new video storytelling series that focuses on the unique backgrounds and perspectives of our employees and the path they took to their role in financial services today. Our hope is that by showcasing such a wide range of talent, we will draw even more diverse candidates to the pool.
But it’s not just about getting more diversity into the pipeline, it’s about supporting the development of those candidates after we hire them and ultimately empowering them to take on roles in upper management. It’s about becoming more inclusive from recruiting all the way up to the executive ranks.
While every institution will take its own approach to becoming more inclusive, there are some fundamental best practices that I’ve witnessed over the course of my own journey that can help us get there as an industry.
Supporting With Conviction
No one, even if perfectly suited to the role, makes it without help. My own backstory reflects the tremendous difference that support can make.
I was born and raised in Kolkata, India, a city that teaches you that nothing is given. For most of the 14 million inhabitants across its sprawling metropolis, qualifying for study or finding work abroad is difficult. Yet I knew from the time I was in sixth grade that I wanted to move to the U.S.
As soon as I shared this dream with my parents, they began saving money to bring my dream to fruition. It took a while, as I worked through my undergraduate studies in India before finally landing in Cleveland, Ohio, for business school. Mine is a time-honored story for generations of new Americans: I arrived knowing that if I work hard, give my best, and receive guidance and support from the right people I can achieve my full potential.
After graduation, as I began my job search, I wanted to find a community that celebrated my goals and would invest in me—just as my parents had—so long as I was willing to put in the work.
Graduating with an MBA from Case Western’s Weatherhead School of Management, I was fortunate to have great options open to me. I began my career as a financial analyst and then moved into valuations before ultimately coming to RBC to work in strategic finance and compensation for our Private Client Group.
My parents believed in me completely, and that conviction gave me a strong foundation. When employers show that same conviction, they are able to attract and develop diverse talent.
Creating a Sense of Place and Family
Part of what made RBC the right environment for me was the sense that I wasn’t just another employee but an important member of the family.
I felt this way because senior executives regularly took me under their wing as would an older brother or sister, helping me to learn the ropes, pushing me to do my best and coaching me on how to be successful in a large organization. Managers and colleagues openly celebrated happy moments in my life, like the birth of my children, and supported me through the difficult ones.
This sort of work environment may sound like a given, but in speaking with friends from other companies, I know that it’s not. Yet, this sense of a “second family” is invaluable to those who join our industry from a unique background—or, like me, from a different continent entirely.
This sense of place and family is also an important retention tool. It’s easy to leave a company where you feel no personal connection, but it’s much more difficult to turn your back on family.
Results at the Top
The final piece, and the one that takes the most investment and commitment, is making sure that as an industry, we are elevating diverse candidates to senior management positions.
Obviously, these roles are few in number and require years of preparation and cultivation at an institutional level. They are also less frequently held by minorities.
As I mentioned, I was fortunate to have several advocates and mentors who helped me navigate the organization and move up in the ranks. A new generation will be moving into C-level roles like mine, and they will be shaping our industry in new, transformative and potentially even preservative ways. The best chance to ensure a diverse workforce—and effective client service—well into the future is to ensure that my experience becomes commonplace and that advancement processes, compensation structures and executive training all reflect the industry’s stated desire to increase diversity in their employee and executive ranks.
Wealth managers need to look at diversity in their organization from a holistic perspective and even a temporal one. It takes time, support, confidence and, frankly, some risk. We all have that one decision or choice memorably made by our family, driven by hidden wisdom that years later proved incredibly consequential. Though it isn’t easy, today’s wealth managers have the capacity to do the same for their diverse talent, to be that second family. They should wholeheartedly begin.
Vikesh Nemani is chief administrative officer at RBC Wealth Management—U.S.