Human Resources Strategies To Improve Recruitment And Retention

Experts From Stifel, Baird, Advisor Growth Strategies, Vestmark And AAAA Explain What Really Drives Satisfaction And Productivity At Leading Wealth Management Firms

Chris Latham, Managing Editor, Wealth Solutions Report

Human resources policies can have an outsized impact on recruitment and retention results at wealth management firms, from the front office to the middle office to the back office.

This in turn may materialize over the long-term into bottom-line changes in the financial condition of RIAs, independent broker-dealers and even wirehouses. Since HR comes down to maximizing worker productivity in tandem with worker satisfaction, firms must consider how nearly every aspect of the business influences that equation.

Compensation; career development programs; technology stacks; compliance; onsite, remote or hybrid work models; as well as diversity, equity, belonging and inclusion (D.E.B.I.) policies all become relevant to firms seeking to stand out as a destination of choice for top talent.

When it comes to financial advisors in particular, HR policies also have to reflect a firm’s fee structures, investment products and financial planning solutions, along with its stance on independent and employee business models.

This vast scope of factors invariably leads firms to prioritize some over others at any given stretch of time, based on what decision-makers see as most important to amassing the most desirable personnel. Of course, that calculation itself calls for determining who exactly is the most desirable personnel.

‘Center Of The Universe’

Alex David, CEO, Stifel Independent Advisors

“Once everyone – from the executives themselves to the trading desk to the back-office staff – realize that the center of the universe is the FA, a natural filtering of FA choice will materialize,” says Alex David, CEO of St. Louis-based Stifel Independent Advisors, which manages over $6.5 billion in assets across more than 100 advisors. “When you look at the data of FA satisfaction, the highest-ranking firms are simply winning the recruiting wars.”

David sees the trend toward advisors moving to more entrepreneurial firms, both W2 and the IBDs and RIAs, as set to continue, due to the sense of control and work satisfaction that comes with it. Yet firms that put the advisor first will have a much easier time balancing a W2 captive advisor field force with an independent field force than firms that do not, according to David.

He believes that managers always should look for the best talent, spreading their net as far and wide as possible. In David’s view, the best managers believe their jobs are not to be recipients of service from their staff, but rather they believe they’re placed in their roles to deliver service to them. This is why firms experience incredible loyalty when the hierarchical model is turned on its head, he asserts.

Training Programs

Katie Costigan, Executive Market Director, Baird Private Wealth Management

At Milwaukee-based Baird Private Wealth Management – which has assets under management (AUM) of $255 billion, more than 1,300 advisors and over 160 locations across the country – three interrelated recruitment and retention programs are in effect.

The two-month Financial Advisor Training Program (FATP) covers expectations, compensation, growth plans, business structure and more. It’s been running since before 1991 and has a 90% retention rate. The Foundations Program aims to attract young and diverse advisors while addressing succession needs for existing FAs. It launched in 2012 and has a 72% retention rate. For two years, Baird’s branch support associate development program has helped candidates become SIE/7/66 licensed and potentially join FA teams.

“We take our time and hire the right people, which may be fewer in number, but they are happy they came here,” says Katie Costigan, Executive Market Director at Baird Private Wealth Management. “We prioritize finding business partners with a client-first mentality, whose values and priorities align with ours. We will continue to evolve, but not chase the latest trend to lure people in with the biggest check versus a full value proposition.”

Compensation And Payouts

Phoenix-based Advisor Growth Strategies works with RIAs on management consulting, transitions and M&A needs. Brandon Kawal, Principal at the firm, argues that the RIA channel continues to be the net winner in recruiting advisors with the channel maintaining the highest headcount growth rate over the past five years.

Brandon Kawal, Principal, Advisor Growth Strategies

Kawal argues that firms balancing employee and independent models must constantly set expectations with advisors about what the payout justifies, what support is available and why. Another big challenge he sees here is managing profitability because firms must harmonize payouts, support and resources to achieve the right return to the business.

Regarding compensation, Kawal thinks its system and progression is more important than its total dollars. He advises that the most competitive firms offer a path to recognize top performers through their compensation system while ensuring that average outcomes are competitive. Competitive compensation structures also include both short- and long-term incentive structures, which makes recruiting and retention dependent on how a contributor fares today and tomorrow, according to Kawal.

“As many firms race for unprecedented size and scale, we expect the labor market to remain tight,” he says. “This means competing for talent will require better ‘upside’ for the contributor and that can’t just be money. Career development, growth and ongoing advancement opportunities will separate the best from the rest.”


To some extent, advancement in the wealth management industry tends to depend on one’s ability to master the available tools. This is one reason why firms that invest in innovative resources such as technology can be a gamechanger for recruiting and retention, according to Rob Klapprodt, Corporate Strategy Officer at Vestmark.

Rob Klapprodt, Corporate Strategy Officer, Vestmark

The wealthtech company provides outsourcing, portfolio management and direct indexing solutions for advisors, large wealth management enterprises and asset managers. It has over $1.5 trillion of platform assets and supports more than 72,000 advisors. Klapprodt sees technology upgrades as crucial for smaller advisory businesses that lack the resources of larger firms – especially for creating efficiencies that can have a huge impact on an advisor’s ability to serve clients better, deepen existing relationships and prospect for new ones.

“With evolving investment trends and regulations presenting new challenges to advisors, firms that consistently look for ways to improve their services will be better positioned to attract and retain their own talent,” he says. “The first step is figuring out if your firm has the capacity and people to build new solutions, or if it makes more sense for the business to outsource certain services. Some firms may even be in a spot to acquire it.”

Diversity, Equity, Belonging & Inclusion

While easy to overlook in an industry that still has relatively few minorities, wealth management firms can improve their effectiveness and finances by making D.E.B.I. programs core to their HR policies, according to Christian Nwasike, the Chairman of the Board of the nonprofit Association of African American Financial Advisors(AAAA). He also runs Practice Management Consultants, which focuses on communication, leadership and sales strategies for diverse financial advisors.

Nwasike advocates for incorporating an assortment of D.E.B.I. policies into HR recruitment and retention. These include attracting diverse talent, making sure employees feel valued and included, ensuring equity in opportunities, reflecting the client base as it becomes more diverse, implementing systems to measure progress toward D.E.B.I. goals and holding stakeholders accountable for performance, as well as building partnerships with organizations that can help optimize these policies.

Christian Nwasike, Chairman of the Board, AAAA

He also encourages the adoption of something he calls Supplemental Professional Development Coaching and Training programs to help increase individual productivity, which Nwasike emphasizes with Black and African American advisors. Its strategies for firms include peer-to-peer mentorship programs, fair and equitable promotion policies, transparent career pathways, as well as employee resource groups (ERGs) that offer professional development opportunities and serve as a platform for sharing experiences and ideas.

“Wealth management firms that are thinking about future growth should consider the ‘lived experiences’ of employees as a reflection of their client base,” Nwasike says. “Firms that capture and implement this insight will lead their peers in return on human capital management and investments, sales revenue, customer growth, greater market share and higher profit levels.”

Chris Latham, Managing Editor at Wealth Solutions Report, can be reached at

Related Posts
Read More

Referral Madness

As pandemic ends, excitement about re-engaging with client referral sources soars  After one of the crucial turning points…

Sign Up for Our Newsletters

Sign Up for Our Newsletters