In the wealth management industry, there are two major issues: planning a successor and diversity. However, new and innovative approaches made by established firms prove that by hiring and providing diverse staff with mentorship, companies can solve these two problems at the same time. These initiatives ensure that new staff receive guidance and the older staff get the comfort and security of knowing that their business will be in good hands after a change in ownership.

Companies like Wells Fargo are at the forefront of this trend. Their Associate Financial Advisor program, which has been created to facilitate mentor and mentee relationships, includes 48% minorities and 36% women, much higher than the 16% for each which makes up the industry average.

Such a scheme has proven to be a boon for the company as senior advisors have left competing firms to join Wells and take advantage of the career guidance their assistants would receive.

There is definitely a great need for older advisors to get assistance. These are people who spend their careers helping to secure other people’s futures but don’t have the time to do the same thing for themselves. In fact, according to this data, over 70% have made no formal plans for succession, and when looking at those who are less than 5 years away from retiring, that number is still as high as 60%.

One main concern advisors have is that the businesses will falter without them, or that they simply don’t want to think about life after they leave. Others simply say that they’re not ready to have someone else take over.

Other companies are implementing similar policies. RBC is transforming their Associate Financial Advisor training program to hire more diverse and qualified staff members from various areas of the industry. It trains them on various elements of their upcoming change in ownership, but also gives them personalized support and guidance. 

UBS has also created a development scheme to groom the next generation of diverse financial advisors.

When interviewed for comments, Emily de la Reguera of Next Generation Advisor Development at UBS said: “We need to look at a demographic of advisors that more accurately reflects our client demographics and in particular not just the demographics of today, but into the future as well. 

“Whether it is gender diversity or ethnic diversity, we want to attract the very best talent in order to create an advisor population that more accurately reflects our client demographics.”

The landscape is changing, not just socially and culturally, but also in terms of business too. Today, companies must be seen to be inclusive and accepting of all creeds, genders, races, and religions, but the transition to get from where we once were to where we will be in future will require planning, hard work, and empathy. However, many companies are now proving that such a transition is not only possible but desirable.

Succession Link has built an online platform that makes it easy and convenient for you to find the perfect buyer for your financial practice or to locate a practice that is the right fit for an acquisition and the growth of your business. Click the link to find out how Succession Link can help you. 

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