What needs to be done to close the financial advice gender gap?
Republished with permission from CommSec
Women currently make up just 20 percent of the financial advising profession, according to the Financial Planning Association of Australia (FPA), which has teamed up with Financial Executive Women (FEW) to improve the numbers.
That 1-in-5 figure is in stark contrast to Workplace Gender Equality Agency (WGEA) data that shows women make up 55.7 percent of the financial and insurance services industry.
So why is financial advice lagging when it comes to the gender gap?
After all, as the FPA points out, thousands of women are missing out on an intellectually stimulating career with significant earning potential, flexible work hours, and the opportunity to positively impact lives.
A possible cause
Ellie Fordham, a financial adviser at Dozzi in Brisbane, has been working her way up the ranks in the financial advice industry since leaving high school in 2006.
She believes the main reason women still don’t join the industry in droves is the most obvious one: they simply don’t know about it.
“At school I had absolutely no idea what the financial planning industry was. I was lucky to basically fall into the industry,” she recalls.
“I saw an ad in the newspaper looking for a trainee financial adviser, and as I hadn’t heard about this before, I thought I might as well apply for the job.”
That was eleven years ago.
Now a seasoned financial adviser, Fordham says she learned everything she knows about the profession through her work on the job – not through any kind of careers counselling.
In a way, she says, this helped her launch herself headfirst into a workplace dominated by men.
“I had no preconceived ideas about financial planning as a profession because I didn’t have any knowledge about the industry,” she says.
“The fact that the majority of advisers in my firm were men therefore didn’t worry me.”
Does she see things changing?
Fordham says that she’s observed a gradual increase in the number of women over the years, which she thinks will help to inspire future generations of female advisers.
“I definitely feel a change,” she says.
“We’re not quite there yet, but we’re getting there, and as the women now are relatively young, we’re going to see these women for a long time to come.”
How would she increase female participation?
Fordham believes the most effective way to get more women into the industry is also the simplest: let them know it exists.
She believes there needs to be more of a concerted effort to promote it to high-schoolers and university students as a positive, career-fulfilling industry – just like accounting.
“It’s not very well publicised and, unfortunately, when it is publicised these days it often isn’t for very positive reasons,” she says.
Fordham does note, however, that the industry’s efforts to improve its image following several negative media stories in the past has made it more attractive to women.
For example, new laws have been set in motion that will see financial advisers regulated by an independent
professional standards body.
Funded by the big four banks and AMP, the body will be responsible for setting an industry exam, developing a code of ethics, and determining the education and development requirements for both new and existing advisers.
“A lot of changes have been made recently to legislation and the industry is now moving forwards in the right direction,” she says.
“We need to show women that the industry gives you the opportunity to make a massive impact to a client’s life.”
Important: This article has been prepared without taking account of the objectives, financial or taxation situation or needs of any particular individual. Before acting on the information, you should consider its appropriateness to your circumstances and if necessary, seek appropriate professional advice. Any information used in this article is for illustrative purposes only.