Hit ‘Re­set’ on Firm Cul­ture

Ad­vi­sors need to ex­am­ine whether they’re truly cre­at­ing a re­spect­ful work en­vi­ron­ment as sex­ual har­rass­ment al­le­ga­tions over­whelm other in­dus­tries.

Financial Planning - - CONTENT - By Carolyn Mc­clana­han

Ad­vi­sors need to ex­am­ine whether they’re truly cre­at­ing a re­spect­ful work en­vi­ron­ment as sex­ual har­rass­ment cases hit other in­dus­tries.

THE WOUNDS ARE OPEN, AND IT’S TIME TO START down the long road to heal­ing. Be­fore we can do that, how­ever, we have to won­der why we haven’t seen more re­ports about sex­ual ha­rass­ment out of the wealth man­age­ment in­dus­try. In part, I be­lieve it’s be­cause our male-heavy fi­nance cul­ture went through a slew of cases in the 1990s, in­clud­ing the in­fa­mous “Boom-boom room” case at Smith Barney.

Th­ese cases height­ened aware­ness of the sub­ject. Yet the re­cent de­par­ture of two long-term, male, high-rank­ing em­ploy­ees at Fi­delity In­vest­ments of­fers ev­i­dence that we still have a long way to go. Thank­fully, Fi­delity’s lead­er­ship han­dled this head-on and re­al­ized that train­ing around th­ese is­sues needs to be on­go­ing.

Is this form of abuse a prob­lem in smaller ad­vi­sory firms? Of course it is, but there are dif­fer­ences be­tween large and small firms.

First, em­ploy­ees at smaller firms are less likely to have sup­port from large hu­man re­sources de­part­ments, and it’s doubt­ful their al­le­ga­tions will make head­lines. As a re­sult, they may be more hes­i­tant to come for­ward with ha­rass­ment claims.

Sec­ond, the smaller the firm, the more sway the owner of that firm has in set­ting the cul­ture. Most firms are run by men, and if they are ob­tuse about sex­ual mat­ters, there is prob­a­bly an is­sue. I heard re­cently from a woman who was in­vited to join a 100% male firm be­cause they wanted to be more in­clu­sive. She learned quickly just how in­sen­si­tive the men in the firm were about the is­sue of sex­ual ha­rass­ment.

When placed in a sex­u­ally un­com­fort­able sit­u­a­tion, women have his­tor­i­cally used a va­ri­ety of tech­niques to defuse the sit­u­a­tion — laugh­ing it off, avoid­ing the sub­ject or be­ing icy. Some­times we just gave in. Our jobs are im­por­tant to us, and we of­ten can’t af­ford to lose them.

Ac­cept­ing the sta­tus quo was some­times the only choice. Be­ing in the one-down sit­u­a­tion made it tough for women to fight back as a group. What we lack in the work­place is the

After re­ports of sex­ual ha­rass­ment at Fi­delity In­vest­ments, CEO Abi­gail John­son moved her of­fice closer to fund man­agers.

set­ting of a tone that makes ha­rass­ment less likely. Sadly, many men don’t even re­al­ize it’s hap­pen­ing.

This has to change.


Is pe­nal­iz­ing the per­pe­tra­tors of sex­ual ha­rass­ment the way for­ward? I’m afraid if this is the only ac­tion taken, we all will lose. While abusers must be held ac­count­able, will pun­ish­ment after the fact change the un­der­ly­ing cul­ture that al­lowed their bad be­hav­ior in the first place?

There are two broad ac­tions that would make last­ing pos­i­tive change for small firms as well as large ones. Ten-per­son in­de­pen­dent firms have as much re­spon­si­bil­ity to sup­port and pro­tect work­ers as their much larger peers.

First, all fi­nan­cial ser­vices firms should im­me­di­ately fill their boards and ex­ec­u­tive-level po­si­tions with at least half women. Boards need to re­flect the diver­sity of the broader pop­u­la­tion. That would mean we need to hire more women and mi­nori­ties. The CFP Board has sev­eral ini­tia­tives in place to make this hap­pen.

Fresh, di­verse lead­er­ship can more eas­ily re­set the tone of or­ga­ni­za­tions.

Sec­ond, fi­nan­cial firms need to de­velop and cod­ify pos­i­tive cul­tures go­ing for­ward. Re­quire­ments for open com­mu­ni­ca­tion, in­tol­er­ance of bad be­hav­ior and how to deal with sex­u­al­ity in the work­place should be ad­dressed in cor­po­rate en­gage­ment stan­dards. Em­ploy­ees should be as­signed as cul­ture keep­ers to fos­ter a great work­ing en­vi­ron­ment, and they must be given the power to ad­dress those peo­ple who are not fol­low­ing the cul­ture.

Of course, we are all sex­ual be­ings. Sex­ual be­hav­ior out­side of what so­ci­ety views as right is rarely dis­cussed in a healthy man­ner.

Peo­ple har­bor­ing sex­ual de­sires out­side the norm fre­quently de­velop un­healthy mech­a­nisms to cope with their feel­ings. Porn ad­dic­tion and the hir­ing of sex work­ers are be­hav­iors we may see in peo­ple who oth­er­wise lead what ap­pear to be ex­em­plary lives.

Peo­ple in power have the abil­ity to ful­fill sex­ual needs by tak­ing ad­van­tage of those they over­see in the work­place. It’s im­por­tant to cre­ate a zero-tol­er­ance sex­ual ha­rass­ment pol­icy, pro­vide reg­u­lar op­por­tu­ni­ties for open and di­rect com­mu­ni­ca­tion so all em­ploy­ees can dis­cuss un­com­fort­able sit­u­a­tions, and make am­ple use of ther­a­pists trained in work­place com­mu­ni­ca­tion to re­duce the chance that peo­ple in power will act on th­ese im­pulses. Of course, the peo­ple in power have to set th­ese poli­cies in the first place.

In our firm, we dis­cuss openly un­com­fort­able is­sues in­te­gral to our per­sonal lives and the wider world. Our cor­po­rate en­gage­ment stan­dards are re­viewed and up­dated at least yearly, or when­ever we hire a new em­ployee. We even have a therapist on re­tainer to work with us as a group and in­di­vid­u­ally help with com­mu­ni­ca­tion and cul­ture is­sues as they arise. This fos­ters an en­vi­ron­ment of safety, trust and en­cour­age­ment to ad­dress hard is­sues as they come up.

What about nor­mal sex­ual at­trac­tion? With a sig­nif­i­cant amount of our time spent with co­work­ers, how can it not hap­pen? Com­mu­ni­ca­tion and sane poli­cies about how to deal with at­trac­tion in the work­place are a must.

Fos­ter­ing a safe en­vi­ron­ment for con­ver­sa­tion and sup­port is crit­i­cal. I sug­gest mak­ing “Fierce Con­ver­sa­tions” by Su­san Scott re­quired read­ing, or of­fer­ing sen­si­tiv­ity train­ing (I rec­om­mend Fierce Inc. train­ing). Th­ese ac­tions can build the cor­ner­stone for healthy work­place com­mu­ni­ca­tion. Em­ploy­ees may also de­velop the skills they need to han­dle healthy work­place ro­mance, as well as ha­rass­ment and abuse.

A work­place is like a fam­ily, and all fam­i­lies have some dys­func­tion. By ad­dress­ing our dys­func­tions openly through em­pa­thy, com­mu­ni­ca­tion and a de­sire to cre­ate a great life for all in­volved, we can cre­ate health­ier and hap­pier fam­i­lies.

Add in a change in the bal­ance of cor­po­rate power, and we will be well on our way to heal­ing and cre­at­ing a bet­ter fu­ture for all of us.

For more in­sights on how to stamp out sex­ual ha­rass­ment in wealth man­age­ment, please see p. 18

Is pe­nal­iz­ing per­pe­tra­tors of sex­ual ha­rass­ment the way for­ward? If this is the only ac­tion taken, we all may lose.

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