“Friendliness without heartfulness is arrogance”* – Customer advisors at banks still have weaknesses

The results of a survey of asset managers and bankers conducted by the Mindful Finance Institute show an urgent need for action when it comes to empathy and emotional intelligence in financial and investment advice.

“Access to the customer has completely changed. In the past, extensive talks resulted in the provision of a suitable product in the hand. Since the financial crisis, customers have been much more well-informed, but they are also equipped with a great deal of partial knowledge. This makes it much more difficult to provide advice,” sums up the head of private banking at a major bank.

The renowned Leipzig think tank 2beahead, on the other hand, looks 10 years into the future: “Experts and studies indicate that consumers worldwide prefer to use personal AI language assistants, rather than visit a bank branch or outlet. By 2030, almost all consumers’ financial needs will be met by dialogue-oriented AI with integrated specialised AI entities that handle even complex financial services”. (2beahead, Financial Services 2030, p. 25)

Oh dear, that is a tough nut to crack! Especially for an industry that is not exactly known for its innovative strength. And all this made us at the Mindful Finance Institute even more curious. What will happen in financial and investment consulting in the years to come? With a focus on this question, we started a series of interviews with independent asset managers, freelance financial advisors and the heads of investment consultancies of banks. “Quo vadis, investment and financial consulting?” What does the industry need, what does the individual customer advisor need in order to keep up with the foreseeable changes?

“Investment tips” are no longer in demand

First things first: even though chat bots, robo-advisors and AI assistants are already being developed and used today, the majority of experts believe that there is still a considerable need for human-to-human interaction. Even if this perhaps only applies for the next 10 to 20 years. “Independent investment advisors are much more agile than bank advisors. Today, they are evolving into asset guides – and they must understand the personal circumstances of the customer first and foremost, and not simply turn up already bearing the product they are going to sell,” a bank executive soberly observes. And the head of an asset management company adds: “Young people today no longer need to talk about which papers they require in their portfolio. That’s why we have the MSCI World”. And far too many advisors would still come up with the old idea of an “investment recommendation” instead of taking a holistic view of the client.

However, as banks and investment advisors in particular will now ask, hasn’t there always been a need for financial and investment advisors to know and understand their customers, and their personal circumstances? It is certainly true that there has always been a requirement for this, but the actual execution has not gone much beyond a friendly smile and product sale. Strict regulations, enormous sales pressure, the excessive number of customers per advisor and the often exaggerated self-image of the advisors have so far prevented bank advisors from dealing with the customer in a holistic, empathetic way. As a result, their role and therefore also their turnover is being increasingly covered by independent advisors and asset managers, by ROBOs and ETF.

Friendliness alone is not enough

So what now? Which personal skills does the financial and investment advisor need, in order to satisfy the increased demands of customers? Our interview partners unanimously stressed the importance of empathy and emotional intelligence. “The advisor must show an interest in people, a genuine interest,” said one respondent with many years of experience. “To do this, you must be able to listen, perceive how the other person is feeling, be capable of putting yourself in their shoes. Then you are on a level.” And the “asset guide” of the future is described “as one who can support the customer, pick up the customer and give them an emotional base”. Also cited as essential were authenticity, vulnerability and human talent. A basic technical understanding of asset allocation and risk-return considerations must be present as a hygiene factor in consulting, but “it is essential to recognise what moves and drives my opposite number”. This requires “pleasure and openness in working with people”.

But the issue is whether this is even possible nowadays? Especially in traditional banks, where stress, anxiety, pressure and excessive demands now prevail? The customer enters the branch and – ping – an interest in people, cheerfulness and openness are supposed to be there right away? A fake smile often covers the fact that there is nothing left to laugh about. And financial service providers still equate mere friendliness with customer orientation. What a terrible mistake! “Friendliness without feeling is arrogance”, said the former boss of one of the leading hotels in Germany. There is nothing to add to that.

“We are looking for advisors who really enjoy dealing with people, with a high degree of empathy”, says the boss of a financial planning limited company when asked about the demands on the financial advisor of the future. Hmmm! It is almost impossible to train a philanthropist out of a born misanthropist. But that would not reflect the overwhelming majority of bank employees and financial advisors either. For them, empathy, emotional intelligence and sensitivity can be learned, practiced and ultimately embodied in a customer relationship. No easy task, and certainly not a matter of a one-day sales seminar. And without the backdrop of a philanthropic corporate culture, absolutely impossible. Generation Y and Z advisors in particular attach major importance to such qualifications, as our interview partners pointed out.

So how do you get there?

The neurosciences and mindfulness practices demonstrate a sustainable and effective method. One of the key findings of modern neuroscientific research is that “our brain can be shaped”. So we can learn regardless of age and we can acquire new ways of thinking and behaving at any time – if we understand some of the mechanisms in us that induce this. “Mindfulness is the scalpel used to carve pathways in the brain,” says Daniel J. Siegel, one of the world’s leading neuroscientists. Firstly, we learn to perceive ourselves better. And if we can do that, then nothing stands in the way of a better and deeper perception of our opposite number.

However, as you will no doubt say, the empathy demanded of our interview partners also has something to do with emotions, doesn’t it? Correct! Emotional self-control is also the first decisive step here in being able to deal with the customer in a better – more empathic – way. “If you can take good care of yourself, you can also take good care of others”; this is an important rule for (customer) relationships. Emotional self-care is an essential basis for the ability to put yourself in the customer’s shoes, to understand them both emotionally and empathically. Incidentally, this aspect is gravely neglected in traditional “How-to-deal-better-with-the-customer” seminars. Take a look at what your customer advisors actually learn there and whether it holds out? Perhaps it’s time to try something new with our approach.

Gaining new qualifications in new ways

We have come a long way: From the future of financial consulting, and the demands on the financial advisors of the future, to neuroplasticity and emotional self-care. The Mindful Finance Institute’s programme of qualifications for financial advisors, which will be re-launched in late autumn 2020, covers the same broad area in “Successfully managing customer relationships in the digital age”. A modern course running for 10 weeks with a blend of just 2-3 attendance days, weekly webinars, peer group exchange, online coaching and an online learning library anchors the new way of dealing with customers in practice. We are currently discussing course credits with the FPSB. Get fit for the future in the financial industry! Get in touch with us ( and we will send you the programme and the link for registration as soon as it becomes available.

* “Friendliness without heartfulness is arrogance” is attributed to Carsten K. Rath

August 2020

Article by Dr Friedhelm Boschert, Managing Director of the Mindful Finance Institute; chairman of the board of the Oikocredit Austria Support Association; former chairman of the board of Sberbank Europe/Volksbank International; coach and mindfulness trainer.

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