The financial services industry increased the representation of women among its employees during the past two decades, only to have a substantial exit of female employees with the onset of the COVID-19 pandemic. Increased caregiving and household responsibilities led to nearly one-third of women leaving financial services temporarily or permanently, rendering the progress of previous decades moot.
Claudia Goldin, professor of economics at Harvard University, describes the discouraging phenomenon accurately by stating, “[Gender] inequalities that existed before the pandemic are now on steroids.” According to a recent MetLife study, nearly 50% of women surveyed stated that the pandemic has negatively impacted their career path. For success in continuing with their current occupations or returning to the workplace, women are seeking increased flexibility and career advancement opportunities as well as skill development and supportive work cultures.
A recent study conducted by The American College Center for Women in Financial Services on behalf of The American College Center for Economic Empowerment and Equality at The American College of Financial Services found 55% of financial advisors surveyed did not have a mentor. Of those surveyed, more women than men sought mentorship outside of their current employers and outside of the industry. This is particularly important to industry leaders, especially those wanting to retain a diverse workforce.
Formal and informal mentoring can help achieve upskilling, supportive work environments and career advancement opportunities. Industry leaders can help address the challenges faced by working women or those considering a career change through targeted initiatives to help retain and advance women within the industry.
Mentors provide a powerful combination of attributes. The best mentor is a catalyst for professional development, a pathway to industry contacts, an emotional support system, an inspiration for career trajectory, a role model and a candid cheerleader of a mentee’s career. Mentors can have a positive and profound impact on a mentee’s confidence, advancement and success. Mentoring can be, at times, intensive, arduous and rewarding, with successes and letdowns. For women, mentorship is critical in professional advancement, promotion attainment, salary increases and career satisfaction and is particularly important in male-dominated professions. Industry leaders can seize an opportunity to establish mentoring initiatives, especially at a time when so many women are leaving the financial services industry temporarily or permanently.
Mentoring is mutually beneficial to businesses and employees. Companies with formal mentoring programs have higher retention and engagement rates. Employees who partake in formal mentoring programs are more likely to benefit through higher compensation, increased promotions and greater career satisfaction. Given the empirical support for mentoring, it is surprising that fewer than half of individuals in the financial services industry have a mentor.
Here are some mentorship best practices to help you keep this important commitment:
• Establish a personal connection and trust with a mentee. It’s an impactful relationship; treat it as such — break from formal roles and titles to establish common ground and equality.
• Ensure you are available. Before committing to the relationship, evaluate how much time and attention you have to devote to a mentee.
• Allow relationships to grow organically. Not all mentor/mentee relationships are a good fit even if they began with promise.
• Contribute to the development of character and job skill competencies. Quality mentors go beyond ensuring a mentee has the requisite competencies for a job and devote time to assisting them with developing self-awareness, confidence, empathy and other key characteristics of future leaders.
• Show support and praise success. Mentors should bring energy to the relationship in support of their mentee’s professional endeavors. This does not preclude mentors from addressing concerns or providing valuable feedback, but good mentors prefer support over being critical.
• Be open to sharing your professional network. This can be helpful to the mentee once you feel they can benefit from other professional contacts.
• Encourage a mentorship team. Each mentor on the team can serve a different role in a mentee’s professional trajectory.
• Know your limitations.
• Keep confidential client information private.
Mentoring is a proven retention tool and an avenue for advancement for women. Quality and successful mentoring can serve as a method to help women develop a sense of inclusion, develop skills and get promoted. This is particularly timely for the financial services industry, with the increased resignation of women, the consideration of career changers, and the desire and need for flexibility.