Market intelligence report reveals only marginal gain in representation over past eight years
Women are controlling a larger share of wealth - estimated $4 trillion in global assets by 2028 – so why are there still so few female advisors in Canada’s full-service brokerage (FSB) channel?
A new report from ISS Market Intelligence shows that since 2015 there has only been a three-percentage-point increase in the share of female representation in the FSB channel, which remains less than one in five of all advisors (18%).
The research looks at why women do not have stronger representation and how the barriers to their participation can be addressed, given that industry targets for female representation within teams are in the 20-30% range.
Key issues include maternity leave and other matters relating to balancing family life and career and the perception that the industry is male dominated. A compensation structure that favours commission is also a barrier for many women who would prefer a fixed salary, especially in their early career years.
But industry perceptions along with a lack of awareness of careers in the FSB channel are also limiting the recruitment of advisors, the research found.
“The industry recognizes the need for better female representation in brokerage but may need to redefine what success looks like and how quickly it can be achieved,” said Vince Linsley, Associate Director at ISS Market Intelligence. “Reimagining the compensation structure, improving support systems, and addressing the challenges of recruitment and succession planning are crucial. Firms must attract and retain more women in brokerage to effectively serve the growing wealth and preferences of female clients.”
Women are better represented in branch manager roles. Among the big six banks, 31% of branch managers were women as of 2022, up sharply from just 11% in 2015. Non-big-bank brokerage firms have also improved in this area with women accounting for 32% of branch manager roles, up from 20% in 2015.
Industry missing an opportunity
The report highlights the importance of addressing the lack of women working in the FSB channel, not only for societal reasons, but also the business case.
With such a large amount of wealth being controlled by women already and its expected growth, those firms with women advisors are likely to have a significant advantage by offering expertise from those who have lived experience of the unique challenges women face, from longevity to income gaps.
But given the reasons that are deterring women from the industry, what can be done to boost recruitment?
Getting them interested early is a commonly used technique including recruiting straight from university, holding career days, providing mentorship programs, internships, and shadowing roles.
To address the compensation issues, succession plans are being used by some firms so that books of business can be passed down to younger advisors, along with financing programs to help address the issue of paying for a book of business, particularly while on leave.
