Now that the wealth management industry is beginning to have the conversation about diversity and inclusion (D&I), I’m hearing a lot of: “I totally support diversity and inclusion, but my firm’s too small to do it.” In other words, there are people of goodwill in our profession who want to try to do a better job at being more inclusive but consider their organization’s size to be a major constraint. I totally get it, and yet it’s just not true. There are plenty of things that smaller firms, from solo practitioners to single-digit ensembles, can do to achieve the successful practice of D&I.
It’s truly heartening that we’re even having this dialogue at all. Honestly, as a person of color, I’m a little surprised but extremely gratified. It really feels like progress is on the horizon this time.
But I’m old enough and have been around long enough to know that enthusiasm can ebb quickly when the hard work of change sets in. Who among us hasn’t made New Year’s commitments that didn’t survive the year or even its first month? Change is hard. It’s important for us to remember this, because as we move past the nice words, some really challenging work awaits us. After all, we’re dealing with subjects that’ve been both taboo and not so invisible for the entire history of our country, of which the history of our profession is but a small part.
So, as we begin, let’s acknowledge that kind words and positive intent can carry us only so far. What we’re really committing to is fundamental change, not only in our policies and practices, but, in reality, our worldview. Alternatively stated, the successful practice of D&I requires us not just to do things differently but also to be different in our approach to life and the subset of it that’s our profession. Truly, how you see the world must change and become more open.
I’ve identified three things that even smaller organizations can do to achieve the effective practice of D&I.
First, start with your culture: How diverse and inclusive is it?
If you’re a solo practitioner, the question may change a bit to how open are you to people who’re different and experiences that are new and/or unfamiliar? In other words, how diverse is your client base? How much and easily do you interact with people of a different gender, race/ethnicity, sexual orientation, religious affiliation, national origin, social and/or educational background, etc.?
If you’re typical, the answer to that first question is “not very,” which is OK. Studies show that the average person’s circle of relationships is exceedingly homogenous. The point is to recognize this and then to choose, consciously and proactively, to change it.
This could be as simple as taking greater note of and choosing to interact with folks who’re different than you yet whom you encounter in your everyday life. Or it could be seeking out a different type of cuisine and engaging the staff and/or owners in conversation so that your perspective is broadened. It could be choosing to enter a niche where your services would be valued but with which you haven’t yet connected. In sum, there are myriad ways in which you can open yourself up more meaningfully to different types of people, communities and experiences that enrich your life both personally and professionally.
If yours is a smaller firm, all of the above applies along with the opportunity to diversify your staff over time. Look at who your colleagues are now: Notice any patterns? Without judgment, let’s acknowledge that this reflects your current comfort zone. In order to embrace D&I fully, this means that you’ll have to change by breaking out of these likely narrow confines. The strategies recommended above work as well as any number of the following:
- Are there any gender patterns in your staffing? For example, are the vast majority of advisors men and the support staff women? Well, then, you now realize that you have to think differently and then act differently with respect to gender.
- Are there any People of Color on your team? In which roles? Perhaps you now realize that you have to think differently and then act differently with respect to race/ethnicity.
- What are the dominant political and/or religious affiliations of your colleagues? Maybe you now realize that there is an opportunity to find, attract and value people who think and/or believe differently.
My second recommendation would be to implement an internship program at your firm.
If you already have one, does it include both summer opportunities as well as term-time ones? Internships can be a source of future talent, but they can also add value in real time. You know how you say to yourself, “If we just had more time, we could get to …”? Perhaps hiring an intern could help you do just that, assuming, of course, that you seek interns who’re somehow different than the current members of your team.
This last point bears repeating: If you make the change of creating an internship program and then hire the exact same type of people you already have, you’re compounding the problem, not solving it, making yours a more closed and exclusionary environment, not a more open and inclusive one. Accordingly, this may require you to reach out to identify and attract candidates in different ways, which, let’s acknowledge, will feel uncomfortable, at least at first. But this is what the successful practice of D&I requires, moving beyond our comfort zones.
Further, if this pandemic has taught us anything, it’s that all of our roles can be conducted successfully virtually, so remember this when implementing your internship program.
Finally, if finding a more diverse set of internship or permanent hire candidates is a bit of a stretch for you now, consider collaborating with industry organizations like the AAAA Foundation and the FPA Externship Program, among others, to help you access a more diverse talent pool. Again, this initial outreach may feel uncomfortable; do it anyway.
My third suggestion reflects the wisdom of the incomparable Rianka Dorsainvil, co-CEO of 2050 Wealth Partners and a pioneering advocate for D&I in our profession. In essence, it’s a paradigm shift: When you’re considering candidates to join your firm, is how well they fit into your culture one of the most important criteria, if not the primary criterion? For virtually every organization, the answer will be “yes,” which is why we have the problem that we have. Simply put, because of our comfort zones, we’re always seeking people who’re just like us. That means that we’re consistently missing out on the opportunity to bring in people who’ll add to our organizational culture in meaningful ways, Dorsainvil says.
In other words, to achieve the successful practice of D&I, you should seek “cultural add” rather than “cultural fit,” which, let’s acknowledge, will be uncomfortable at first. Do it anyway.
Of course, what I’ve elucidated above is also applicable to larger organizations, so we have to acknowledge that size is not an inherent or prohibitive barrier to achieving the successful practice of D&I. Simply put, what matters most is our willingness to make ourselves uncomfortable initially, to act in new ways that produce far more diverse and inclusive results and that help us to evolve our organizational cultures rather than simply perpetuate them.
Given that the business case for D&I is so clear (and the research becomes more conclusive every day), don’t let the size of your organization keep you from evolving your approach to your most important asset—your people. By following these three recommendations and other best practices, you can ensure that your firm doesn’t miss out on the dividend of higher performance that’s one of the many benefits of the successful practice of D&I.
Walter K. Booker is the chief operating officer of MarketCounsel, a business and regulatory compliance consultancy for investment advisors.