Pandemic leads to new tactics for recruiting new advisors

Meeting the needs of today’s clients means changing the advisor force serving those communities, and for some firms that has meant shifting their recruitment strategies.

Spurred in part by the pandemic, changing corporate strategy and new client needs, firms are changing what they look for in recruits in terms of both industry experience and demographic makeup.

Mississauga-based Edward Jones began to recruit more individuals with industry experience as opposed to rookies about four years ago, but the pandemic made the firm further prioritize this strategy.

One challenge was that unlicensed rookies were unable to sit for licensing exams during lockdowns. As a result, the brokerage recruited 100 advisors in 2020 compared to the several hundred they may have recruited in a normal year, said Katrine Clark, principal, branch team talent acquisition with Edward Jones.

But those 100 recruits, most of whom came from other firms, were the best fit for the company, Clark said. Edward Jones currently has 875 advisors in Canada.

Edward Jones wasn’t the only firm that reduced its recruitment last year. When the pandemic first hit, Toronto-based Sun Life Financial Inc.’s field team turned their efforts away from recruitment and toward helping their current advisors.

“Last year we had to refocus our energy to take care of our existing advisors and clients,” said Scott Woodman, vice-president, distribution with Sun Life.

As a result, Sun Life’s 2020 recruitment numbers were down compared to previous years, but appointments are now up 70% over last year, and Sun Life is back to its usual recruitment goal of around 500 new advisors annually. The firm is focused primarily on rookies who are either recent graduates or individuals seeking a second career. In terms of retention, roughly 83% of recruits are still with Sun Life after one year, while 43% remain past year two.

But the pandemic changed Woodman’s ideas about how those rookies can build their books of business. Instead of solely working with clients in their home province, advisors can use remote working tools to build a network across the country (providing they meet provincial licensing requirements).

“We’ve opened up the market for that new recruit to stay local but also to think larger without having to fly or drive to meet clients to do business,” said Woodman. “I think the opportunity for new advisors today is greater than it’s ever been if you think about it through that viewpoint.”

Like Edward Jones, Winnipeg-based IG Wealth Management turned its recruitment efforts away from rookies to focus on more experienced advisors or individuals who have worked in the financial services industry.

Following its rebrand and strategic shift in 2018, IG Wealth took a more targeted approach to recruitment. The firm created a talent acquisition team to specifically focus on bringing on new advisors. Of the more than 200 new advisors brought on board annually, roughly 50% now come from within the industry, said Lisa Ritchie, vice-president, talent acquisition, advisor network with IG Wealth.

The new candidates are usually referred by IG advisors or branch administrators, or they’re contacted by the talent acquisition team. The recruits from the financial services sector are arriving from banks, brokerages, independent dealers and insurance companies.

Brent Allen, senior vice-present, financial services distribution with IG Wealth, said veteran advisors are drawn to the firm’s investments and upgrades to its compensation package, digital tools, discretionary platform and succession program — improvements that current advisors have also noted.

“When [our current advisors and associates] see people joining us every week from different firms from across the country, they look around and say, ‘Something’s going on here,’” said Allen. “And it’s reinforcing the investments we’ve made in the firm over the last several years to be in the competitive position where we are today.”

The focus on industry veterans has also led to greater retention. More than 90% of industry recruits remain with IG Wealth after one year, while approximately 70% of the non-industry recruits remain on board. IG Wealth’s rolling one-to-four-year retention rates all hit 15-year highs in the past 12 months.

To bring women to the company and, in some cases, into the industry altogether, IG Wealth has hosted a number of career discussions “by women for women” covering topics including balancing the demands of career and family and potential compensation. Such efforts may be paying off as women made up 40% of new appointments in recent months, said Ritchie.

“We’re starting to see some great momentum,” she said.  The pandemic, which in many cases impacted women differently than men, made recruiting women more challenging, Ritchie said, but the momentum has returned in the first part of this year.

Sun Life is also focusing more on diversity and gender parity in its advisor force. Woodman said it’s important that Sun Life’s leadership, particularly the recruitment field team, reflect the advisor demographics the company wishes to recruit.

As such, the company has made efforts to hire field leadership team members to reflect the communities in which they work, and there are more women in the recruitment consultant role at Sun Life than men, Woodman said.

“At Sun Life something that is extremely important to us as we look at our advisor population is that we have gender parity,” said Woodman. Thirty-six percent of the firm’s advisor base are women, but there are plans to move that number to 50% or higher.