In this, her latest article for IFA Magazine, Katie Brinsden, managing director at the national, directly authorised IFA, Truly Independent, takes a look at the lack of gender diversity within the financial advice profession.
Below, not only does Katie look into some of the key issues involved but she also offers some potential practical solutions to the problem, explaining how and why we need to work together for change if the advice profession is going to truly thrive in future.
I recently wrote about the gender imbalance in the financial advice industry, outlining a number of reasons why it is in everyone’s interests to address the problem. I argued that the key benefits might include more diversity of thought, a broader range of skills and a greater ability to meet clients’ needs.
Of course, highlighting the likely consequences is the easy bit. As the disappointingly modest impact of countless efforts and initiatives has shown over recent decades, identifying genuinely effective solutions is much harder.
The search for solutions
I really cannot pretend to have definitive answers in that regard. But I do believe we can learn potentially valuable lessons from the wider field of science, technology, engineering and mathematics – otherwise known as STEM – for the simple reason that this issue is rife throughout it.
In particular, the experience of STEM as a whole suggests we need to think in generational terms. We need to recognise there is no prospect of a dramatic turnaround. Above all, we need to accept that the chances of thousands of women suddenly deciding that ours is the profession for them are zero.
Below I’ve highlighted three findings from academic research into the enduring lack of women in STEM. They are presented chronologically, progressing from pre-career to early career, to highlight how attempts to recruit more women advisers could encompass different life stages.
I do not pretend these ideas will transform our industry in sensationally short order. Rather, I think they underline how those of us already working in this arena might do more to make a difference.
Ultimately, the point is that the women financial advisers of the future have to find our profession attractive. They have to sincerely want to be part of it. And they have be welcomed into it at every turn.
The fact that women’s representation in STEM is still so low[1] reminds us this will remain a gradual process. But any acceleration we can help bring about has to be worthwhile – not just for the adviser community but for the many clients who stand to gain from the long-awaited advent of positive, lasting change.
Cross-industry learnings
- Generate interest at the earliest opportunity
I worked in the motor trade before moving into the wonderful world of financial advice. My own career trajectory therefore lends weight to the commonly held perception that people fall into our industry comparatively late in life, often after working in an unrelated capacity.
The truth, though, is that many individuals make momentous career decisions far earlier. For example, studies have found girls tend to lose interest in STEM subjects before the age of 16[2].
Perhaps this trend could be reversed if more emphasis were placed on developing children’s financial literacy during their school years. This might help sustain young girls’ interest in STEM and buck the prevailing stereotypes that continue to shape so many career paths.
- Maximise key influences
Especially during teenage years, informal influences can be another powerful factor in a person’s career choices. They normally come from sources close to home, most obviously family members.
Women engineers provide a classic illustration of this phenomenon. Research has revealed a significant percentage have fathers who work – or worked – in the same trade[3].
Does this mean financial advisers should encourage their daughters to follow in their footsteps? Not necessarily. But they could aim to make a bigger contribution to raising female participation in our industry – maybe by serving as mentors or advocates in schools and universities.
- Understand the importance of role models
Not least when they are young, women are inspired by the accomplishments of other women[4]. It is vital, though, that these accomplishments are associated with role models who are viewed as “real”.
This means stories of manifestly atypical “superwomen” are of strictly limited use. The same is frequently true of insights delivered by successful women whose level of seniority is so distant as to be daunting.
Ideally, role models should be just a rung or two higher up the ladder. As well as making their achievements seem aspirational but not beyond reach, this should enhance the likelihood of candid and compelling discussions around both the attractions and the shortcomings of a career in financial advice.
Katie Brinsden is Managing Director of Truly Independent.
But before you go…
While you’re here, why not check out Katie’s previous blog for IFA Magazine on ‘Plugging the advice gap’
[1] See, for example, WISE: “Updated workforce statistics”, September 2023 (https://www.wisecampaign.org.uk/updated-workforce-statistics-september-2023/).
[2] See, for example, CNN Business: “The exact age when girls lose interest in science and math”, February 28 2017 (https://money.cnn.com/2017/02/28/technology/girls-math-science-engineering/index.html).
[3] See, for example, Medium: “Women in engineering: an historical oxymoron of the greatest importance”, May 27 2020 (https://medium.com/through-the-eye-of-the-prism/women-in-engineering-an-historical-oxymoron-of-the-greatest-importance-9a9476822c34).
[4] See, for example, British Psychological Society: “Female peer mentors have long-lasting positive impact on female STEM students”, January 24 2023 (https://www.bps.org.uk/research-digest/female-peer-mentors-have-long-lasting-positive-impact-female-stem-students).
