Why it’s time to tackle the female elephant in the room
As you know, CL4Women was established with the objective of making financial services more accessible for females. Those of us who have been through divorce, illness, bereavement and general life experiences often have different needs to men and so we try to make financial planning as engaging and easy-to-understand as possible.
That is why I was intrigued to read a recent report produced by the WealthiHer Network which highlighted a number of the financial services industry’s shortcomings when it comes to engaging with female clients.
Rather than continuing to ignore these findings - as financial services and many other industries have a habit of doing - I believe the time is ripe for the financial advice and wealth management sectors to re-assess how it approaches and engages with female clients.
While this exercise is likely to involve change at multiple levels, I believe the benefits could be huge for the industry and clients alike. Thinking about how to properly engage with female clients will ultimately allow financial planners (like us) to build strong and sustainable relationships with female clients (like you) over the long-term.
What the study shows
Here are some key findings from the study:
- WealthiHer’s research was based on a survey of more than 2,500 people conducted by consultancy Kantar, a survey of more than 100 high-net-worth women, as well as one-to-one interviews and focus groups held with financially successful women.
- The research suggests that a little under 73% of women believe that men and women have different investment attitudes and styles, while 71% of women perceive men as more willing to take risks.
- 67% of those women surveyed felt it was important to make a social impact when investing. In addition, around 59% wanted to use their wealth to provide for their family and achieve security.
- Seven out of 10 women admitted to having average or below average self-esteem, while 36% felt patronised during their interactions with financial professionals.
- 28% would like the industry to use less jargon and 36% highlighted a lack of knowledge or over-complexity as the reason they have not engaged with the financial services sector.
- The final hurdle to overcome is the lack of representation of women in the industry: around 45% of women surveyed would like to see more female client-facing staff.
Time for change
So what can the industry do to improve the way it engages with women?
My first suggestion would be to take a step back and think about the bigger picture. Like many things in life, it could well be that financial planning and investment management propositions have historically been designed with men in mind – in the same way that cars and safety belts are built for the average male!
Of course, there are exceptions to many generalisations but anecdotal evidence does suggest that men tend to identify with numerical returns, targets and the idea of beating benchmarks. Meanwhile, women typically relate to financial goals or milestones and how these fit into their life plan.
It is also worth taking on board WealthiHer’s findings that female clients have a bias towards impact investing, want jargon-free interactions with financial professionals, a more personalised service and access to networks.
The final challenge to improve gender diversity in the financial advice and wealth management sectors is likely to take time. Some people may argue that the wheels are already in motion on this subject. However, I believe we could see more women on the front line in finance if the potential career paths available received better publicity.
There is also the prominent barrier that many women and men face in financial services after having children, where a full-time role or the requirement to be in the office everyday may prove difficult or expensive when it comes to childcare. This is where more flexible working practices could come to the fore.
At CL4Women, we hope to be at the forefront of tackling the female elephant in the room by playing our own small part in revolutionising the way in which financial planning services are provided to women.
Let’s hope that the industry starts to consider the implications of WealthiHer’s findings. Nothing would make me happier than seeing more women feeling more confident to seek professional financial planning advice and taking control of their financial futures.