A good investment adviser is a tricky set of skills to hire, and high-end financial advice firms are struggling to find the right talent at present.
Article by James Dunn, appeared in the AFR 23/10/2014
“Good investment advisers are hard to find,” says Edward Jewell-Tait, head of private banking at Credit Suisse in Australia. “So many of the people who may be good advisers may not have expertise across all asset classes.”
Sean Cortis, principal and chief executive at chartered accountancy firm Chapman Eastway, says trying to recruit good staff is the greatest challenge he faces. “As a boutique organisation, we don’t have a brand that people are naturally attracted to, and we need to find people that really relate to a very bespoke culture and ethical standard. It’s very, very hard.”
The difficulty has a lot to do with the fact that good advice is both an art form and a science. “I like to break advice down into a number of elements – there is the analysis through to monitoring,” Cortis says. “A good analysis piece requires someone who cares, who’s got empathy and who’s a good active listener, so a lot of the training we do is around those soft skills. Really, we are looking for the X factor. We spend a fortune on behavioural assessments and psychological profiling and all that sort of thing, looking for that.”
Cortis likes to take a colleague into client meetings, for a second point of view. “There’s always a different perspective – you hear different conversations, there are different perceptions.
“We always go in with two of us, and I’ll come out of the meeting and say, ‘I heard this, what did you hear?’ And I find that I actually get an added perception from taking in a female adviser as well,” he says.
In much of Europe and the United States, investment advisers are drawn from the pool of graduates with financial or economics degrees. But Britain still has the Oxbridge tradition of humanities graduates moving into careers such as finance.
Sarah Macdonald, senior relationship manager at Credit Suisse, exemplifies this with her master of arts in modern languages from Oxford. She went on to serve her apprenticeship as an equity analyst in London, and had a decade of experience in financial services before joining Credit Suisse in 2011.
“When I was being recruited out of university, the consistent message from the institutions that I was speaking to was that they were looking for all-rounders. They wanted people who had robust personalities, who had developed the basic skill sets at university around analysis, due diligence, conclusion building, and putting across views,” Macdonald says.
“Actually the subject matter itself, at that level, is almost immaterial. It’s having that basic tool set so that you can apply it to whatever subject matter you’re looking at any given time.
“For myself, I think learning that skill set does breed or feed an eagerness to continue learning, which when you’re dealing with private clients, frankly, is an invaluable trait,” she adds.
Craig Tonkes, senior relationship manager at Credit Suisse, says learning is everything. “We all came out of university in our early 20s thinking we were the masters of the universe, but really, we didn’t know anything. But we did actually learn how to learn. The rest can all be taught over time.”
Employing graduates works, Tonkes says, because you can grow them into your culture and into the means of practising as an adviser. “It works best when you can hire in a professional with a few years of working experience in a relevant field and introduce them into your firm’s culture,” he says.
To a great extent, there needs to be a certain level of experience on top of the actual qualifications, Cortis says. “We deal with a lot of personal family issues, including succession and the fact that business owners don’t want to let go. Sometimes they have not told their family the extent of the wealth,” he says.
“There is the realisation, quite often, on the part of the children of wealthy people of just how much wealth is going to come to them. People can find it hard to deal with the prospect of inheriting substantial wealth.”
And that is ultimately what you have to think about when employing advisers, Cortis says. “It comes back to that question of educational qualifications versus experience. What piece of paper’s going to give you the emotional intelligence to deal with those kinds of situations?” he says.