How to manage remote teams while retaining talent and improving diversity

The wealth management industry's diversity problem has a new dimension: the shift to remote work. 

Fewer than one in four, or 23.6%, of financial advisors are female, according to the CFP Board, which sets standards for the financial planning industry. Black advisors comprise only 1.9% of advisors, while Hispanics make up 2.9%. With office life reshaped ever since the COVID-19 pandemic first unfolded in early 2020, hybrid and remote work are emerging as a new factor when considering how to recruit and retain a diverse team. 

Globally, half of women with jobs want to work mostly if not fully offsite, compared to 46% of men, according to research by Future Forum, a research consortium on remote work launched by Slack with Boston Consulting Group, design and branding company MillerKnoll and nonprofit Management Leadership for Tomorrow. In the U.S., 86% of Hispanic/Latinx and 81% of Asian and Black knowledge workers prefer a hybrid or fully remote work arrangement compared to 75% of their white peers.

At the Women Working in Wealth Summit held by the American College of Financial Services on March 8 in New York, recruiting experts discussed how wealth advisory and financial planning firms need to create a more inclusive and diverse workplace that focuses on where women want to work.

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"There are still so many organizations that have not acknowledged what women want," said Chelsea Williams, the founder and CEO of Reimagine Talent Consulting, a recruiting firm in New York. "We're still in a period of change — three years is not that long — but we need to be open to always change." 

Many advisors have not only embraced staying away from the office but thrived. Nearly three in four, or 73%, of advisors expect to continue working at least partly from home this year, according to Arizent's "Predictions 2023" report. 

Still, a home office can create the conditions for burnout. And the Financial Industry Regulatory Authority, which oversees brokers, is contemplating new rules for overseeing home and offsite offices.

U.S. Chamber of Commerce research last January found that mid-size businesses across all industries are embracing hybrid work in order to keep their best employees. But firms need to make sure they adapt their work dynamic to create a more equal environment, Williams said. 

"It's the manager's responsibility to look across the team and see if there are different opportunities to a person coming to the office and the one in remote work and work alongside them," she said.

Research in 2021 by the Harvard Business Review found that hybrid work arrangements often create power imbalances between those who are in and out of the office. And for women who prefer working from home, that can lead to getting overlooked for promotions or losing out on mentoring and networking opportunities.  

That is especially the case at financial services firms, according to PricewaterhouseCoopers. A 2020 survey by the accounting firm found that of the 22% of employees who said they were less productive in remote work, the top three reasons were choosing to work less (41%), difficulties collaborating (30%) and difficulties getting the information they needed (30%).

That so-called proximity bias can be exacerbated by the different preferences of executives and employees, according to Future Forum research. Over 40% of executives reported they work from the office 3-4 days a week compared to just 30% of non-executives. And 75% of executives currently working fully remotely reported they would prefer to work from the office three or more days a week, as compared to 37% of non-executives. 

Jessica Harrington, an executive business coach with Carson Coaching in Omaha, Nebraska, said during the panel that it's important for financial advisors to create multiple channels to hear from their team and be "visible" to them, even if they're not in the office everyday of the week. She suggested conducting surveys and scheduling weekly meetings in the beginning of the week.. 

"People want to be seen and heard, and you'll get the data about their views before they make decisions to leave the company, for example," Harrington said. 

Reimagine Talent's Williams said that data helps identify if the values of a firm are reflected in its employee teams. "Not every accommodation can be considered, but it needs to be acknowledged," she said, adding that a manager  "knows which characteristics are necessary to get to the next level and can help the person to achieve that."

The need for transparency can be even greater in a hybrid work environment, where employees don't always see each other face-to-face. "I start off my weekly meetings with each team member sharing two pieces of personal and professional news," Harrington said. "My job is to support them and in order to do that I need them and me to be honest."