We need to increase the number of women in the advice profession, but quotas are demeaning, unconscionable and act against our fiduciary duty.
There has been much debate of late within the financial advice industry on the topic of gender quotas.
At Stanford Brown, we have a very clear view on gender quotas – they are immoral, demeaning to women, they act against the best interests of our clients and they are unconscionable.
Australia has some 24,000 financial advisers, of which only about 20 per cent are women. This is a completely unacceptable blight on our industry and we must all work to address this chronic imbalance.
But there is a right way to do this and a wrong way.
Quotas mean discrimination. It really is as simple as that. It means hiring people not on their merit, their work ethic or their customer focus. It means recruiting based on the lottery of genetics. Society has come a long, long way in repudiating discrimination and few civilised people would today countenance favouring people based on their gender, their sexuality, their ethnicity or their religion.
There is so much to dislike about gender quotas. Blatant discrimination is one but here are some additional reasons:
- Quotas tear at the fabric of an organisation's culture.
“Is she here because she's good or because we need to get our quota up?” You might not hear people actually say this, but you can be damn sure they'll be thinking it.
- They also create doubt in the mind of the newly-hired female.
“Did I get this job because I'm a woman or because I'm outstanding?”, they may ask. For lovers of TV show Suits, remember the humiliation and anger Jessica Pearson, the black female head of the firm, felt when she discovered that she had been hired as a ‘diversity ticket’.
- It spectacularly fails the legal and moral obligations of all planners to put their clients' best interests first.
“Hi Client, let me introduce you to Samantha. She's not as good as our other advisers, but hey, the government forces us to get our gender numbers up. Sorry.”
- It demeans and patronises women.
“Sorry, ladies, but us progressive guys feel you need a helping hand. Here, have a job on us.”
- Quotas entrench class divisions
The already substantial privileges of privately educated girls (like my daughter) are often the beneficiaries of quotas, while boys of immigrant and poor families are discriminated against. Privileged girls from upper-middle-class backgrounds are taught how to play the system. The sons of recent migrants are not.
- Quotas can lead to humiliation and failure for women promoted and hired into jobs for which they are not qualified or yet ready.
Balance is essential for a thriving business and enables us all to better serve our clients. At Stanford Brown, we seek balance in ethnicity, in gender and in personality type. It makes for a far better work environment and is very much in the best interests of our clients. Financial advice businesses are more effective if they reflect the communities they serve. This goes for ethnicity as well as gender.
Rather than mandate by law who we can and cannot hire, let us all work together, starting at the level of schools and universities, to address the gender imbalance within the advice profession.
Programs like Alisdair Barr's Grad Mentor and the AFA's Female Adviser of the Year are the right way to bring about change. Let's encourage more of these ideas and end this nonsense about quotas.
Jonathan Hoyle is the chief executive at Stanford Brown
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