Investire | March 2023 

Over the past twenty years, the figure of the financial advisor has changed radically. At the same time, it has remained true to itself: billows, tidal waves, storms, and whirlpools have not altered its ability to keep the ship steady without losing focus.

And yet, the 2003 financial promoter was radically different from the financial advisor of 2023 for a series of objective and subjective factors.

According to public records, financial advisors are inevitably more mature: in 2003, they were 35 years old, while today they celebrate their fifty-fifth birthday.

In 2003, financial promoters were met by a vast majority with suspect and conceit, considered on par with door-to-door salesmen.

In fact, twenty years ago, all banks together with their highly paid strategic consultants used to focus on their geographical footprint, based on the establishment of branches. Back then, working in a bank used to be a dream for many.

On the other hand, financial advisors were deemed less manageable compared to the more tame bankers. Thus, while many banks and bankers recognized the value of their networks of financial advisors, they did not hesitate to give them up to raise money, only to rebuild them years later.

Today, the model of financial consultancy has become an example to follow. Over 10.000 bank counters have closed over the past 20 years and more than 50.000 employees have lost their jobs; instead, the number of financial advisors has increased by over 10.000 units and 1.000 new offices have been established in Italy.

This is a true Copernican revolution, a turning point in our view of the universe. Copernicus challenged the geocentric model by claiming that the sun, rather than the earth, is at the centre of the solar system: in this sense, the financial advisor is to the banker, what the sun is to the earth.

Moreover, over the past twenty years, assets under management have increased tenfold, the number of clients has doubled, and the percentage of private clients assisted by a financial advisor has exceeded 40%.

However, numbers alone are not enough to portray this change, which is first and foremost mental and personal, and therefore all the more radical.

In fact, the industry of financial consultancy is based on people, be them clients or professionals. As a consequence, the forma mentis of the financial advisor has evolved over time.

Twenty years ago, financial advisors had to fight like lions to gain respect on the market; today, they are aware of their value and their self-esteem has grown accordingly.

The evolution of this professional figure has been under investigation for over twenty years. So far, three different work styles have been identified: defenders, midfielders, and strikers.

Defenders are good managers of old clients. They are not very proactive when it comes to new activities or looking for new clients, they tend to be less autonomous and more critical of their bank.

Midfielders are good managers of old clients and tend to be more proactive when it comes to new activities. They are quite autonomous in their job, but also aligned and more satisfied with their bank, more inclined to work in teams in which they often act as leaders.

On the other hand, strikers are more proactive and resourceful when it comes to both old and new clients. They tend to be very autonomous in their job, less aligned with their bank, and more inclined to work independently.

The diagram accompanying this article says more than words could.

Percentages give an idea of how radical the change undergone by the figure of the financial advisor has been: strikers have decreased from 93% in 2003 to 59% in 2022; midfielders have increased from 4% to 35%. Defenders have maintained their minority status with a slight increase from 3% in 2003 to 6% to 2022.

The significant increase in the number of midfielders is a plastic representation of a profession evolving in the only possible direction: being able to work as a team rather than working as a free agent, the midfielder can control the game and pass the ball to the goal scorer without forgetting those behind.

This evolution represents the history of men and women who have been changing their souls and question themselves continuously.

Behind this change, is a job which combines the positive aspects of business professionals, the commitment to the company, the team spirit and, at the same time, the individualistic drive of entrepreneurship.

Another set of data testifies to the evolution of the species as well as to the ability of the financial advisor to grow in the right direction.

75% of clients claim to be fully satisfied with their financial advisor, compared to 34% referred to other professional figures which gravitate, more or less clumsily, around the banking and insurance world.

However, the growth in the number of midfielders suggests that this is not a solo race.

The importance of the bank or financial network has been increasing significantly in terms of solidity and reliability (+45% in 20 years) and digital technologies (+34% in the past year).

Thus, while twenty years ago the brand of the bank or financial network used to be an optional, today it is a must. For this reason, today more than in the past, financial advisors insist that their bank or financial network invest in communication and marketing activities.

Using a military metaphor, the financial advisor is like a soldier in the front line who needs the cavalry and air cover to face the challenges ahead.

On the other hand, there is less and less space for free agents: today, top financial advisors work in team with the support of their bank or financial network. Training and the certification of skills have become a must.

In fact, twenty years ago, very few financial networks would invest directly on the training of their employees through their own internal organizations and academies. Today, those who do not represent a very small minority.

Lately, the training activities carried out by universities operating within financial networks have been joined by an intense internal commitment in the area of communication.

In fact, each morning some networks inform their advisors about the main topics and information, so as to ease their work with clients as well as strengthen their confidence pact.   

In this sense, it is safe to say that the most enlightened leaders of financial networks have contributed significantly to the evolution of the figure of the financial advisor.

The founders and pioneers of the job have a double merit: at the beginning, they managed to personally motivate and grow their networks; then, they were able to pass the baton to those who followed. 

Today, financial advisors resemble naval officers rather than corsairs: the route and rules of engagement are defined with the bank/financial network, however the navigation is still completely in their hands.

To all valuable professionals, good wind.

Nicola Ronchetti