Transcriber: Keira White Reviewer: Sebastian Betti
In 1870, Victoria Woodhull was the first female stockbroker on Wall Street.
Fun fact: She was also the first woman to run for President of the United States.
In the 151 years since then,
we still haven’t had a female President of the United States
and female advisers represent only 18 percent of all advisers.
Now, I haven’t decided to run for President yet
but I do have decades of experience as an adviser
and leader in wealth management.
This probably won't shock any of you,
but women and men don’t have the same investing habits.
Women typically reinvest as much as 90 percent of their wealth
back into their families and communities.
That number for men is only 35 percent.
When women are economically and financially empowered,
they don’t just buy fast cars and golf memberships,
or charter their own rockets to outer space.
No, they actually invest in education, health and well-being for their families.
As an advisor for nearly 30 years, I've seen these differences with my own eyes.
Our male clients,
always wanted to make sure they were outperforming some benchmark.
Whether it was the S&P 500,
the Dow Jones or even their next door neighbor.
They were very fixated on a monetary goal.
Our female clients were more focused on making sure their money
would be sufficient to meet longer term life goals,
like taking care of their children, their aging parents,
perhaps starting a business.
The money was never the end goal.
It was simply a means to the end.
Women are projected to control nearly 110 trillion dollars
in global wealth by the year 2025.
Seem a bit high to you?
Think about it.
In this country alone,
women have longer life expectancies than men.
We have, unfortunately, a very high rate of divorce.
And then there’s the great wealth transfer.
When baby boomers will pass on
and women stand to inherit a lot of those assets.
Think about it.
If they invest 90 percent
of that wealth back into their families and communities,
that’s a whole lot of trillions going to education, health and wellbeing.
If all of this talk about trillions sounds like monopoly money to you,
don’t get so caught up in the trillions.
Instead, focus on the concept that women use their wealth
to make life better for all.
So if financial empowerment for women is indeed better for all of us,
how should an industry like wealth management evolve to meet their needs?
There are two groups of women to consider.
Women investors and women who work in this industry.
First, let's talk about women investors.
When I say the word investment, what images come to mind?
Probably stocks, bonds, the Bull and the Bear, Wall Street,
crazy, hyper-competitive environments, fast talking brokers.
Now think about most of the women in your life.
Are they drawn to these images? Or do they run for the hills screaming?
Now let's look at women in the industry.
As I mentioned, only 18 percent of financial advisers are female.
But can you blame them?
Typical female professions like teaching and nursing
involve empathy, compassion, educating, nurturing.
A lot of traits that we naturally attribute to women.
But were these the words you thought of,
when I said investment, just a few minutes ago?
Probably not.
The investment firm TIAA-CREF did a study a few years ago
that showed that two thirds of women investors don’t trust our industry.
They don’t feel that the investing world was built for someone like them.
When I was an advisor speaking to recently widowed clients,
do you think they wanted to talk about the S&P 500 at that first meeting?
Do you think they wanted to hear about the latest “hot stock”
that would make them wealthy overnight? No.
They wanted someone to listen to their fears.
They wanted someone who was patient with them as they were processing their grief.
I spoke to women going through a painful divorce
and the only adviser they knew
was someone who constantly looked at their husband during meetings
but never at them.
And I can’t tell you the number of times,
when I was in a meeting with a male adviser, a colleague of mine,
who was real intent on showing that client
just how knowledgeable he was about the financial markets.
The goal for that meeting
was to make sure she didn’t take her account elsewhere.
Now that her husband was no longer in the picture.
But you know what, I couldn’t really blame these colleagues of mine,
we all worked in a system that rewarded that behavior.
Get the assets, get the assets.
And when the meeting was over,
the woman would ask me questions like; do you think this is right for me?
What advice would you give me, Anita, if I was your mother?
(Sigh)
They were desperate to trust someone because this was their livelihood.
So you might say it's easy, right?
Let’s just hire more women in the field, to work with these women investors.
Not so fast. That’s only part of the solution.
After all of these years working in this field, I began to ask myself,
Does the wealth management industry need to simply evolve?
Or does it need a complete gut level transformation?
In other words, if the client of the future is female,
does the Bull and Bear approach really work anymore?
Now, to be clear, I’m not advocating a “Pink it and shrink it” approach.
In fact, I’m as guilty as anyone when it comes to launching “Women’s Initiatives”.
The problem is that women are not a niche.
I found that the advice a woman entrepreneur needed
was different from what a widow or a divorcée
or a female corporate executive needed.
But while their needs were different,
the one thing they all had in common was the need to be understood,
be informed and be a partner in financial decision making.
I learned that the skill that resonated most with them
was not some rote memorization of ratios and statistics,
but the art of listening.
I found that rather than holding the meetings in a conference room
with dark wood and leather chairs and awards and trophies on the wall,
it was so much more effective having meetings in coffee shops.
Or over dinner. Or even better at their home.
It allowed us to better understand the person,
their aspirations and goals,
rather than reducing them to this month’s sales goal.
The problem is
that these softer skills, which we attribute to being feminine,
like relationship building and listening and patience,
aren’t always rewarded in this field.
It’s a big shift
for an industry that’s been built on commissions and fees and egos,
where more is better.
But what would happen if leaders started rewarding quality over quantity?
What would happen if we focused on educating the client,
rather than rushing through a PowerPoint presentation?
And contrary to what many leaders at the top believe and trust me, I know a few,
this approach does not have to come at the cost of lower profitability.
Think about it, if our approach results in a stronger relationship with the client,
that’s a higher client retention.
Perhaps additional wallet share, maybe referrals.
I discovered that the key to success was in the human connection.
Strong human connections result in trusting relationships
and who’s better at building trusting relationships than women?
The media loves to portray successful advisors as “The Wolves of Wall Street”.
Bernie Madoff, the fictional Gordon Gekko. Because that's sexy, right?
But what about real life?
What about women like Sallie Krawcheck,
who ran two global wealth management firms
and is now launching her own to help women invest?
What about Mellody Hobson in our own backyard of Chicago,
President of Ariel Investments?
Or Carla Harris, a Senior Executive at Morgan Stanley,
who also happens to be a professional gospel singer on the side?
These are some of the most successful people in financial services right now,
and while they do bring strong feminine attributes to their work,
I can assure you no one thinks they’re soft.
Transforming our industry will not be easy.
Because the soft skills are some of the hardest for people to develop and master.
And yes, the transformation must involve the hiring and inclusion of more women
and people of color.
When I’m out there encouraging young women to consider this career path,
I often hear “I’m not good at math” and “I’m not good at sales”.
Well, I've got news for you. Neither am I.
In fact, I joke often,
that I’m one of the few Indians on this planet who isn’t great at math.
I'm living proof that financial advisers do not have to look a certain part.
I mean, look at me.
I’m a brown skinned female immigrant from India.
I couldn't be further from the prototype.
When I was in college
and I decided at some point that I wanted to become an economics major,
my advisor took one look at me
with my Aqua Net spiked hair, black lipstick, black nail polish,
long black trench coat, combat boots,
and he suggested I go into fashion design instead.
Well, thank God I didn't listen to him.
I believe my success in this field came about because I leveraged my uniqueness.
I have never had a desire to be like everyone else in the room.
My relationship building skills,
my compassion for people, whether it was my clients or my team,
the fact that I made it OK to show vulnerability as a leader
in a very male-dominated environment. All these things made me different.
Was I always rewarded for it? Depends on how you define reward.
Sure, I made a great living.
But the real reward goes back to how I began this presentation.
What do women do with their wealth?
They reinvest back into the community, right?
Well, I’m now reinvesting back into my community,
by developing and preparing other women to be successful in this field.
And helping firms to also meet this moment
in history because it’s an important moment in history.
Why don’t we just call wealth management what it really is?
Financial life management.
We have to start by making sure the front lines
look as diverse as the clients we serve.
But again, it doesn’t stop with hiring the right people.
We need a paradigm shift within the industry itself.
That’s the only way we’re going to change the system and the culture.
The people who currently hold the power need to commit to this change.
But it doesn’t have to be a zero-sum game.
Everyone will be better off. Think about it.
Diverse companies are 35 percent more likely
to perform better than non-diverse companies.
We’ll be able to attract and retain women employees,
if we can describe the work we do as helping others
and not about meeting sales goals.
And if we can show more gender diversity in the field,
it's more likely that women investors will become more trusting of our industry.
Everybody wins.
So whether we call it wealth management
or financial life management or Anita’s rant,
we know this system was built over the course of a few hundred years
with a verytraditional model.
So we’re not going to change this overnight.
But whether we're male or female,
we each play a part in its inevitable transformation.
So let’s not wait another 150 years.
I, for one, am not waiting another day.
Thank you.