The UK is globally recognised as a leading centre of excellence in the personal investment management and financial advice sector and the industry is well positioned to continue to expand in coming years.
A rapidly changing social and economic environment and a growing need for personal investment management and financial advice services are also likely to usher in changes to the way we work and operate.
And, as the industry looks to satisfy and more closely reflect changing client needs, it is time to get the conversation going about diversity.
Financial management is a means of empowering individuals to plan for the future: Pimfa's member firms guide today’s clients along their life journey to achieve their key savings and investments milestones.
From a business point of view, it makes sense to cater for our target audience for two key reasons: a more diverse business will be better positioned to both understand as well as design the services that best serve clients’ needs.
At Pimfa’s Women in Wealth networking breakfast, participants identified the rapidly changing client base as one of the key challenges faced by the industry.
A shift in client profiles and needs means firms have moved to identify new potential growth sectors, including female clients.
For example, many firms have already begun to more actively engage with their female clients, seeking to capture a market that figures from the Centre for Economic and Business Research show will own 60 per cent of the nation's personal wealth by 2025. Another consideration is the financial decision making process. Panellists at the breakfast identified that decisions were often blocked because no involvement or appeal had been made with clients' partners, who the firm had no interaction with.
The personal investment management and financial advice industry also faces another challenge: employment data shows that industry is failing to attract and retain diverse talent and must make a concerted effort to widen its talent pool.
Data from the Office for National Statistics on the labour market highlights that the UK’s finance and insurance services industry is currently employing fewer women than it was 10 years ago.
Despite the crisis-related drop in overall staff numbers, there has been an upward progression of men employed to 682,000 in 2017 from 662,000 in 2007. The number of women employed showed a drop to 515,000 in 2017 – down from 601,000 in 2007. The number of female financial advisers is very low and we are missing out on an untapped market if we fail to even out the balance.
Part of Pimfa’s role is to promote the sector. We also do ourselves a disservice if we are not seen by government and clients to take practical steps. But, as many members are small businesses, what can we do about it?
The widespread adoption of unconscious bias training programmes could help. These are designed to identify and challenge the stereotypes, both negative and positive, that exist in our subconscious and affect our behaviour and decisions we make, including about recruitment, promotion and pay. This equally applies to decisions about men as well as women.
Other interesting initiatives include mixed mentoring programmes, including reverse mentoring to ensure talent is being identified and nurtured throughout the company. Simple approaches that can be adopted include implementing flexible working for both men and women and using technology. This will help raise the profile of the sector as dynamic, forward-thinking and responsive to the needs of both clients and employees.
Diversity will be a continuing theme for Pimfa and our next event for all members, on October 4, will look at issues concerning personal brands.
Liz Field is chief executive of Pimfa
