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The gender divide

Elizabeth Diffin

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Financial advisors must address unconscious gender bias when working with clients and prospects.

A man and a woman walk into an advisor’s office …

No, it’s not the setup of a well-trodden joke. In fact, the difference in treatment that male and female clients receive is far from humorous.

While many financial advisors claim or even believe they treat all clients equally, regardless of their gender, studies show a significant difference in the way advisors work with men and women. The culprit for this inequitable treatment? Unconscious, or implicit, gender bias.

The term “implicit bias” was coined by psychologists Mahzarin Banaji and Anthony Greenwald in 1995. It refers to “attitudes or stereotypes that affect our understanding, actions and decisions in an unconscious way,” be they based on race, age, sexuality or, yes, gender. And financial advisors are not immune.

“I think that we, as financial advisors, have a bias that men understand and know things that women don’t,” said Renee Hanson, CFP, CDFA, an eight-year MDRT member from Phoenix, Arizona. “But we have a choice in how we behave with our biases.”

“As advisors, we are used to prioritizing contact for sales with men, whether due to the position they hold or simply assuming that purchasing power and economic decisions are made by them. In many cases, it is women who actively play that role,” said Maria Del Carmen Gonzalez Sanchez, a three-year MDRT member from Puebla, Mexico. “We are facing a new egalitarian society in many aspects, but we continue to get carried away by the habit.”

Women currently control about one-third of the world’s wealth, but management consulting firm Boston Consulting Group finds that women are adding $5 trillion to the wealth pool globally every year. Similarly, McKinsey & Company, another management consulting firm, projects that by 2030, American women alone are expected to control as much as $30 trillion in financial assets.
So clearly, women are a force that’s not to be ignored.

The science of bias

In August 2020, a team of researchers in Hong Kong, China, conducted a study on bias. Utpal Bhattacharya, one of the researchers and a professor at Hong Kong University of Science and Technology, had recently heard about two separate female acquaintances who had attempted to make sizable financial decisions, only to be asked if their husbands knew about it and had given their permission for the transaction to take place. Bhattacharya was surprised but intrigued by the broader implications of those situations.

“I realized this is not an ancient thing; it is probably something very universal,” he said.

So he attempted to prove it. The methodology of the study simulated an experiment done in a lab. Bhattacharya and his team hired 32 actors — 16 male and 16 female — to play the role of prospects and visit all 65 financial advisory firms in Hong Kong that work with retail investors. Each actor was given certain traits to communicate: high confidence, low confidence, high risk tolerance, low risk tolerance, home biased and universal.

The research ultimately showed the women received worse advice than the men; in particular, they were pointed toward less diversified and riskier investments.

“We find that financial planners discriminate against women who are confident, who have high risk tolerance, and who have a lot of local bias,” Bhattacharya said. “Given the belief that women are less financially literate, on average, [the advisors] believe they can be fooled. And they can sell them more of the stuff that is in the advisor’s interest rather than the advisee’s interest.”

Joanne Ng Ka Lee, an 11-year MDRT member from Hong Kong, China, said she wasn’t particularly surprised by the results of Bhattacharya’s study.

“The reality is that society as a whole views men and women differently,” Ng Ka Lee said. “We have come a long way with equality between genders, but there is still ingrained gender bias in many areas of society.”

Hanson says that gender bias is so rooted in our society that even women can think they’re less equipped to make financial decisions. In her work with women in transition — often divorce or widowhood — she has frequently observed less confidence in women than men when it comes to handling finances. 

“Our life experiences develop us from a very early age,” she said. “They don’t necessarily have to define us.”

I think that we, as financial advisors, have a bias that men understand and know things that women don’t. But we have a choice in how we behave with our biases
— Renee Hanson

Face time

In August 2020, Merrill Lynch Wealth Management published a four-part study examining the role that gender plays in wealth management. The research found that in a 30-minute meeting with a heterosexual couple, advisors committed an average of 10 gender-stereotype miscues, such as assuming that the man was the decision-maker, that the woman was more risk-averse, or that the couple’s finances were merged and jointly invested. Male financial advisors were twice as likely to show one of these behaviors in a meeting than their female counterparts.

“In many cases, for whatever reason, women in those situations are less likely to speak up,” Lindsay Hans, division executive at Merrill Lynch Wealth Management and chair of the executive diversity and inclusion council, told InvestmentNews. “We can’t, as an industry, only rely on this feedback — we have to get to the root of it, which is unconscious biases, and stop that experience from happening in the first place.”

Another part of the Merrill Lynch study used eye-tracking software to catalog where advisors’ eyes focused during a meeting with a heterosexual couple. The advisors, regardless of gender, focused most of their time — about 60% — on the male.

Hanson says that while she tries to give equal consideration to both halves of a couple, she sometimes focuses more on the man because men tend to give less facial feedback, and she’s trying to determine what they’re thinking.

“While we might look directly at one [member of the couple], we do have a peripheral,” she said. “So what happens is you end up waiting to get some sort of feedback so that you know how to continue to take the conversation. The shift has to be that you’re allowing the people to talk. If a person is talking, then you’re making eye contact with that person.”

Ng Ka Lee says that she tries to give equal attention to both people but pays special attention to the “quiet listener” in the room, whether they are female or male.

“From my experience, there will always be one in the couple who may be more detail-oriented, who wants to understand the terms in depth and who has questions,” she said. “To ensure both parties have equal interaction, my communication is addressed to both. For a person who is a quiet listener, I prompt and check for their understanding.”

Gonzalez Sanchez says that she often focuses more on the female half of the couple to make sure she is feeling at ease.

“When I have two people in an appointment, I congratulate them for sitting together to make one of the most important decisions for their family,” she said. “However, I try to direct my gaze and the conversation more toward the wife, with the intention of feeling like her ally.”

Moving past bias

So how can advisors who want to treat their clients equally actually start to realize that goal? It starts with acknowledgment.

“I think just recognizing that you have the bias is a hugely important first step,” Bhattacharya said. “If I’m aware of it, most of the bias will actually go away.”

Project Implicit (, a nonprofit whose goal is to educate the public about hidden biases and to provide a “virtual laboratory” for collecting data on the internet, has various tests people can take if they want to explore their own unconscious bias. The tests explore gender, race, religion and sexuality, among other topics.

Part of the Merrill Lynch study used eye-tracking software to catalog where advisors’ eyes focused during a meeting with a heterosexual couple. The advisors, regardless of gender, focused most of their time — about 60% — on the male.

Bhattacharya also says that advisors need to “ask a lot more questions from their client to figure out the client characteristics, because a lot of the time, they base their advice on stereotypes.”

Hanson agrees that comprehensive and thorough fact-finding is most important.

“Overcoming unconscious bias requires inquiry,” she said. “The key is how do we ask the right questions on both sides? Figure out what’s important to both of them. Get to the core of why a person is sitting across from you.”

She said she emphasizes communication preferences — not just whether they like emails or phone calls more, but how they best receive and digest information. She recalls a couple where the wife was more focused on relationships, while the husband wanted to know the bottom line. So each time she met with them, Hanson would take the first five minutes to discuss the bottom line before moving on to the relationship piece, so that they were both satisfied.

Ng Ka Lee believes it is important to reject all stereotypes and to treat each client as an individual.

“I understand that no two clients are alike,” she said. “I am able to control what’s within my power, which is to approach each meeting by preparing and learning about the clients. When building a client relationship, it is important to fact-find and thoroughly understand the clients’ needs and concerns.”

Gonzalez Sanchez’s advice for other advisors is equally straightforward.

“My recommendation will always be to treat each client with the right time and attention that each one of them requires,” she said. “It is important to address issues of the client’s interest and always have the same willingness and interest in working with all types of clients as we see the best way to prepare and support them for their future.”

The Merrill Lynch study found that only 12% of women were likely to confront their advisor or file a complaint if they were displeased with how they were being treated. So if you’re unsure about how you’re coming across to a client, whether male or female, the solution is simple.

“You have to ask the question,” Hanson said.

And then get to work consciously ensuring you’re treating every client — male or female, young or old, gay or straight — with the respect and kindness they deserve.


Maria Del Carmen Gonzalez Sanchez

Renee Hanson

Joanne Ng Ka Lee


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