An adviser’s gender and that of their client influences the financial recommendations made to them, according to research from King’s College London.
The research provided advisers with detailed information about ten fictitious clients, both male and female versions, and asked them to rate each client on their likely financial knowledge and the degree of control over their investments.
The advisers were also asked to recommended the most appropriate investment portfolio for each client, ranging from lower to higher risk portfolios.
The research found the male and female versions of each client were rated as equally knowledgeable and on average there was no variation in the risk profile of the portfolios selected for each, but the female clients were rated as having less control over their investments.
However, this gender gap became more pronounced when the gender of the adviser was taken into account.
The research found female advisers gave the lowest knowledge and control ratings to the female clients in the sample, recommending lower risk portfolios than that of their male equivalents.
Similarly, the highest risk portfolios were more likely to be recommended by male advisers to the male clients.
The research was carried out by Dr Ylva Baeckstrom of King’s Business School, who based her work on 129 UK-based investment advisers specialising in millionaire clients.
Ms Baeckstrom is a former private banker with her own experience of working with affluent clients at Standard Chartered Bank, Coutts & Co and Morgan Stanley.
The research was intended to address the "complexity" of ensuring women receive the right financial advice to fund a comfortable retirement.
Last year an adviser software company found men were three times more likely to seek retirement advice from a professional financial adviser than their female counterparts.
Ms Baeckstrom said: "Previous studies have looked at how investors rate their own financial knowledge and attitude to risk, but the potential ‘interference’ cause by gender biases that advisers have internalised has not been explored.
"This is important for the financial services industry as it tries to serve the needs of a growing market of independently wealthy women."
Ms Baeckstrom said whilst a "slightly sub-optimal" choice of investments might not be life-changing for millionaire clients, for less affluent women the impact could be far reaching.
She said: "For women who are not as financially fortunate, allocating sufficient money into their private pension investments could be crucial to funding a comfortable retirement.
"This is why I am extending my research to investigate gender bias in advice for clients on more moderate incomes, and the role played by the robo-advisers that are establishing themselves as alternatives for this market."