Our Scorecard on Diversity in the RIA Marketplace – With a Call to Action for Accelerating Change

Our Scorecard on Diversity in the RIA Marketplace – With a Call to Action for Accelerating Change

May  5, 2021


The investment advisory industry has made small, yet significant steps toward diversity – but the pace of change has been slow, and women and racial and ethnic minorities remain underrepresented in both management and adviser roles, a new study by Cerulli Associates and the Investment Adviser Association finds.

Driving Diversity: Opportunities for Action in the RIA Marketplace found that gender and racial/ethnicity disparities among independent and hybrid RIAs remain pervasive. Only 16 percent of their advisers are women, 3.8 percent identify as Hispanic, 2.6 percent identify as Black or African American, and 2.1 percent identify as Asian. And while a slim majority (52 percent) of respondents believed their firm is working to increase DEI, only 35 percent think those efforts have been successful.

The study goes beyond the numbers to identify key challenges discouraging diverse candidates from entering and building successful careers in the industry. It suggests action items – both at the individual and firm level – to address those barriers. And it outlines firm resources, support, and initiatives to increase gender and racial/ethnic diversity, including strategies to recruit and retain a more diverse workforce.

“Our profession has a long way to go in matters of diversity, equity, and inclusion,” says IAA President & CEO Karen Barr. “It is imperative that we step up and confront these issues. Gathering relevant data is a crucial foundational step in addressing diversity in the wealth management industry, because it gives us an important tool to measure progress. This study not only tells us what the statistics are, it identifies where the pain points are and provides a starting point for minimizing or eliminating them.”

“Parity remains an uphill climb for women and Black, Indigenous, and People of Color (BIPOC) financial advi­sors. Despite heightened attention on DEI, these groups remain vastly underrepresented among financial advisors,” says Marina Shtyrkov, senior analyst at Cerulli. “By understanding and addressing the barriers to entry and success, the investment advisory industry will be able to better serve clients with an advisorforce that more accurately reflects the diversity in end-investor markets.” 

Other key findings include:

  • Work-life imbalance, limited representation among leadership, and insufficient mentoring are among the greatest challenges facing diverse advisers.
  • To accelerate meaningful change, firms should consider a range of actions, such as building a DEI team to develop an action plan, offering unconscious bias training to staff, creating affinity groups for diverse advisers, funding scholarships for underrepresented candidates, and forging partnerships with community organizations.
  • There are numerous opportunities for individuals to contribute to their firms’ and the industry’s DEI efforts, including acting as a mentor or sponsor to diverse advisers and volunteering for community activities that build awareness of the profession.


Driving Diversity: Opportunities for Action in the RIA Marketplace is available to view or download on the IAA website.


About the Research

In 2020, the Investment Adviser Association (IAA) partnered with Cerulli Associates to assess the current state of diversity in independent wealth management firms. As part of this study, Cerulli conducted qualitative interviews and online surveys of financial advisors, registered investment adviser (RIA) firm executives, and other professionals. While diversity

covers a wide range of dimensions (e.g., age, gender, race, sexual orientation, ability), this study specifically focuses on the industry’s efforts to expand gender and racial/ethnic diversity among financial advisors.


TAGS: Diversity & Inclusion

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SEC COMMISSIONER PEIRCE KEYNOTE AT 2021 IAA COMPLIANCE CONFERENCE–In her keynote conversation with IAA President & CEO Karen Barr, SEC. Commissioner Hester Peirce discussed her concerns about recent agency initiatives involving climate change and ESG initiatives and other challenges facing the SEC.

MORE IAA VIDEOS – including sessions with SEC officials at our 2021 Compliance Conference and videos on Diversity, Equity & Inclusion – are on our VIDEOS page.