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How do you change the brand of an industry like financial services that lacks diversity and inclusion? How can one company take a stand?
“A persistent obstacle is that our profession is primarily white, male, and older,” says Daralee Barbera, PhD, co-author of Women Matter: The Why and How of Gender Diversity in Financial Services. “When people hire, often they gravitate towards candidates who are like themselves. Women and minorities often become the less probable candidates, yet necessary to create an advisory force reflective of, and optimal to serve, our diverse communities.”
When I met with industry leaders such as Barbera at the 2018 National Association of Insurance and Financial Advisors (NAIFA) conference, many concurred with her that diversity and inclusion is a problem worth solving.
The mission of NAIFA, the leading association for financial advisors, is to advocate for the profession. One of the oldest and largest trade organizations in the insurance field, NAIFA was founded on June 18, 1890 in Boston as the National Association of Life Underwriters.
In a May 2020 workshop, NAIFA examined “The Tone At The Top: How Companies are Moving the Diversity and Inclusion Needle.” According to the NAIFA event, financial services companies have discovered that they need to build diverse teams to boost innovation and problem solving, and to bolster their recruiting and retention efforts. “Many firms have gotten a lot of things right but still have room for improvement,” said an event summary.
“For the 20 years I’ve been in the financial services industry, there have been many discussions about the lack of minorities and women in the profession,” said Advisors Excel co-founder Cody Foster, who I met when I helped edit books for some of the financial advisors they serve. “We want to start taking action and change that, and education seems like a great place to start.”
An insurance marketing organization, Advisors Excel of Topeka, Kansas announced in June the creation of three, $5,000 scholarships aimed at encouraging minorities and women to pursue a degree in Kansas State University’s Personal Financial Planning (PFP) program. Each scholarship can be renewed annually.
The fact his company is located in a locale of particular importance to the civil rights movement is not lost on Foster. In the milestone 1954 Supreme Court decision of Brown v. Board of Education of Topeka, Kansas, the court ruled that separating children in public schools on the basis of race was an unconstitutional violation of the 14th amendment.
“Depending upon the color of your skin and the zip code you live in, your education experience in this country is still a lot different and the opportunities are a lot different,” says Foster. “So there's no doubt that I think part of our motivation was trying to create some opportunities for people that don't necessarily get as many.”
As NAIFA speaker Kristen Hall Eskew said: “Diversity is being invited to the party, inclusion is being asked to dance.” Foster hopes his firm’s action will inspire other firms to act so there is more inclusion of women and minorities.
“The industry in general is trying to figure out ways to approach this topic that are a little outside of what we've done for decades,” says Foster. “We we'd love to inspire more people in the industry to do it.”
Foster offers this advice to women and minorities entering the profession:
“The one piece of advice I would give a professional entering the financial services industry is just to make sure that they're really passionate about serving people,” says Foster. “We're helping people who are transitioning into retirement. They've been working and saving their entire life and they're making this decision about how to make their money last. This profession is a really noble calling that probably doesn't get the credit it deserves. If you're passionate about helping people, I think you're going to do really well in this industry.”
