Want to bring on board more young talent? Then look inside your own firm, suggests Keith Banks, president of U.S. Trust. 

"We’re trying to make sure that for the talented junior level associates — in most cases millennials — there is a career path and we can demonstrate that," he says.

As part of our special report on the state of wealth management, Banks shared his thoughts on how firms can better tap talent within their own ranks, improve diversity and why impacting investing is going to grow in importance.

What’s the most important market force facing your firm?

A couple things. No. 1: The needs of the families that we and others serve are becoming broader and more complex.  A lot of this is because the family is becoming more complex.

The more complex family unit has more complex needs. I think to be in a position to serve those needs in a truly holistic way, you need to have a platform of complex solutions. So I think the bar is being raised for the industry to serve their clients.

Another important dynamic is the aging of baby boomers.  The amount of assets that will transfer when the boomers pass is in the trillions of dollars. That means that you may have had an incredible relationship with the mother or father, but if you are not connecting with the children, the grandchildren and the broader family unit when that money transfers, then you can find those assets in motion away from those firms that haven’t positioned themselves appropriately.

How is your firm preparing for the retirement of its baby boomer advisors?

I have a breakdown of our company by function, and I can see all the employees in critical functions for us and see the breakdown by age. Step one is to be aware, which we are.

Where we have advisors that are getting closer to an age where they may consider slowing down or retiring, we have an open dialogue with them so that we know how they are thinking about it, when they want to do it, and to know whether they want to retire gradually or not.

I’ll tell you some good news. First, the concept of retirement is changing; it used to be you hit 63 or 65 and it was an on/off switch. You either worked or stopped working.  I think more people are inclined to work longer. Some people are saying, “I’m 63, I don’t want to work the hours I’ve been working, but I don’t want to stop working.”

We introduced younger advisors onto their team. They get introduced to the clients, and when the senior advisor chooses to turn that switch to off, a plan is in place and it’s a natural transition.

Finally, it’s about, “How do you bring young talent into the company? “ We’re going out and recruiting people in the younger generation, whether millennials or Gen X or Gen Y.

The other thing we are doing, which is really interesting, if you look at the junior levels of our company or any company, who are they? They are millennials. So we’re trying to create opportunities, create a career path. I can go to you and say, “You do not have to go to another company. I can show you a career path here, and if you are good and work hard, then you can stay at U.S. Trust for your entire career.”

We’re trying to make sure that for the talented junior level associates — in most cases millennials — there is a career path and we can demonstrate that.

How important is it for the industry to mirror the diversity of the population?

I think it’s critically important. Let’s start with business. Women control a large percentage of wealth and it’ll accelerate over time because of demographics: because of their success and participation in the workforce, they’re accumulating more wealth. And some studies show that baby boomer women will inherit a lot of wealth as their husbands pass away. So, No. 1, there is a lot of wealth among women.

If we are calling on a client who is a woman or person of color, and we show up with five white men, then they might think, “I’m not sure they represent me.” The connectivity may not be there.

We live in a diverse world. I think if your workforce does not represent that broader population, then you are out of sync with where the world is. It’s just good business sense to better represent that, and it’s also the right thing to do.

I’ve always tried to create an environment where a person could succeed based on the value that they brought — not their color or gender or sexual orientation. It’s about the value they create as an employee. If you can reflect that and demonstrate that in the people you hire and promote, then you’re sending a powerful signal that you are a company that values that.

What’s your future vision for your firm?

The first few years were about rebuilding and repositioning the firm. In 2008, we had just consummated the acquisition of the legacy U.S. Trust company. We combined Bank of America’s private bank and U.S. Trust, which is the firm you see today. And we successfully completed that undertaking in 2012. We got the company back to where it needed to be. Beginning in 2013 and this year, it’s all about growth.

I tell my team, “Don’t let the word growth scare you.”

We’re only going to grow if we do two things well: take care of our existing client base, bringing solutions to bear for those families’ needs. That deepening of relationships is a positive thing for the clients and for us. And, No. 2, then go out and get in front of other families to bring new clients in.

Impact investing: Is this likely to grow in importance? Will this become a more regular feature of advisor's work on behalf of clients?

I think it needs to be. As more and more millennials come into wealth and the wealth they have grows, and they become a more and more dominant force, I think it’s going to be an important aspect of what they are looking for from wealth management companies.

Awareness is much greater. They’re increasingly focused, not just on, “How much money can I make,” but “How do I make it?"  They are concerned that their investments are consistent with the way they lead their lives.

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