With complex questions about how wealth managers can boost Black representation among financial advisors and executives, Raymond James may have at least one answer.
That’s because Philadelphia area complex manager Tony Barrett and Maryland financial advisor Kaon Nelson created the firm’s Black Financial Advisors Network in 2013 with the support of CEO Paul Reilly and an annual conference that attracted about 130 planners and employees to Clearwater Beach, Florida, earlier this month. While Reilly is quick to note that the firm and the industry have a long way to go, Black financial advisors and managers present at the event explained why the group’s networking, mentorship and feedback to executives is so important.
“The goal was always to get together,” Barrett said in an interview from the event. “Before BFAN existed, we had Black advisors at the firm, but we weren’t really connected. We wanted to get everyone together to start forming a community.”
Raymond James and rival giant wealth managers that have built an industry in which fewer than 2% of CFPs are Black and less than a quarter are women face challenges to their businesses in attracting and retaining the next generation of advisors and clients. Many large wealth managers have also paid out large sums of money to settle race discrimination cases — which often leads to “programmatic relief” requiring firms to create mechanisms for supporting and listening to their Black advisors. Despite some small but notable gains in recent years, only a few firms make that progress verifiable by disclosing the demographics of their advisors.
With long-term retention of Black professionals as a key component of the industry’s diversity problem, Raymond James has been expanding the number involved with the Black advisor network and other groups it calls its Advisor Inclusion Networks: the Women Financial Advisors Network and the Pride Financial Advisors Network. It and other firms have forged stronger links with advisors through such networks and events, or through employee resource groups. The number of participating advisors in Raymond James’ networks climbed 5% in 2021 to 1,391, according to the firm’s latest corporate responsibility report.
Tampa-based advisor Camille York Adrien cited the Black advisors network as “one of the things that brought me to the firm” in 2018. She wanted to find a firm that “understood a woman, and especially a Black woman,” she said in an interview. These days, she’s helping new trainees get connected with the network launched by Barrett and Nelson nearly a decade earlier.
“I got a chance to meet everyone and learn the dynamics. Now they’re a phone call or email away,” York Adrien said. “That is the way that we grow, that’s the way that we become sustainable as an organization. I hope to continue to see those connections deepen and flourish.”
In an interview, Reilly credited the firm’s Black advisors for coming up with the idea for the group and cultivating it to its current size. When he became CEO of the company in 2010, there was “absolute intolerance of any kind of discrimination” but “what was missing was really just a more aggressive approach to bringing people in,” Reilly said.
“The best way to get your numbers up is to not have people leave, so you start there,” he said. “We’ve got a lot of work to do, and we owe it to our community really to change this.”
Disclosure of statistics represents an important factor in driving that long-term shift, according to experts. A dearth of essential data looms as one of many reasons that critics of ESG criteria find ample reason for skepticism about it. However, firms like Raymond James have only just started sharing the figures publicly that they must report each year to the U.S. Equal Employment Opportunity Commission and even fewer of them are willing to state the number of advisors who are Black, Hispanic, Asian, women or members of other historically excluded groups. That makes it more difficult to say for sure which firms truly are leading when it comes to racial equity.
Shareholder actions demanding audits of publicly traded firms’ impact could push more firms to disclose demographic data and other metrics, advisor Keith Beverly of Washington, D.C.-based Grid 202 Partners said on a panel about racial equity investing last month.
“There’s a lot of information we would want to see that we don’t have access to,” Beverly said. “When you talk about shareholder engagement and really looking to move companies forward along that spectrum of doing what’s right, shareholder activism is, without a doubt, necessary and relevant.”
Some clients and advisors could force the industry’s hand on that point, too, according to Craig Metrick, a managing director at massive Englewood, New Jersey-based family office Pathstone. In the panel held by the nonprofit research organization the Croatan Institute, Metrick discussed how “the struggle to get even basic diversity data on companies” makes it tough on practitioners of racial equity investing and their clients.
“That’s incredibly frustrating,” Metrick said. “It’s a barrier to the kind of impact we all think can be achieved and should be achieved in public equities. One encouraging point that I’ll throw out there is that our clients that want to see impact — and it’s a growing number — are not waiting for perfect data. They are impatient as well.”
While Reilly didn’t give any timeline for Raymond James to fully disclose its advisor demographics, representatives for the firm later followed up in an email saying that 1% of the firm’s advisors are Black. Across the firm’s entire workforce, 45% of employees are women and 20% are “people of color,” according to its corporate responsibility report. Those figures can serve as the baseline for investors, employees and advisors who are seeking to judge the firm’s record on representation of Black, Latino, Asian American or other minority professionals.
As part of its efforts to foster more diverse ranks of advisors, Raymond James is taking a three-pronged approach to training. Its Advisory Mastery Program draws about 200 to 300 participants each year for a two-year module designed to help them succeed as advisors. The Wealth Management Associate Program, which launched in 2020, helps trainees gain experience over two years prior to the Mastery Program. And the firm’s Registered Associate Marketing Program offers a one-year path for employees toward becoming an advisor.
The Black advisor network’s efforts include educating incoming employees about that kind of professional development, whether in the company’s training programs or through instructional sessions on topics like marketing, alternative investments and technology, Florida Suncoast Complex Manager Chris Fils said in an interview at the conference.
“There are so many different opportunities,” Fils said. “You have all these paths where, maybe being a financial advisor is not tomorrow. As you learn the business, maybe there’s a glidepath toward becoming a financial advisor.”
The network’s members view mentorships with incoming employees and advisors as a method of “trying to cascade downward an understanding, an awareness” of it, said Steve Pryor, the director of the Boston office of Alex. Brown, a division of Raymond James.
“We’re actively working on that,” he said, “not only bringing people in, but making sure that people here are responsive and receptive.”
At the end of the day, the network could help eliminate the view among many aspiring Black professionals and members of other historically excluded groups that the profession isn’t for them because they don’t see enough representation of diversity in the ranks, York Adrien said.
“That made it that much scarier to join the business,” she said. “When you are able to see people who look like you be successful, that attracts you to the profession. They can see that this is a career for them.”