In an instant, serendipity can change the trajectory of one’s life. Lorraine George-Harik, who co-founded Cerity Partners in 2009, can attest to that. A chance encounter while in college led to a job – and then a burgeoning career – in finance. George-Harik, who speaks several languages, had until that time assumed she would pursue a career that enabled her to apply her linguistic savvy.
Before starting at Cerity Partners, George-Harik served as a Managing Director at Citi Private Bank in New York. She also was a member of the Chairman’s Council for Global Wealth Management at Citi, and a Managing Director at UBS Private Wealth Management in the U.S.
Cerity Partners effectively doubled its size in 2019 to approximately $26 billion in client assets, acquiring Chicago-based Blue Prairie Group, which managed $11 billion, New York-based EMM Wealth, with $3 billion in assets under management, and Los Altos, Calif.-based Sullivan & Serwitz, which manages $1 billion. In January 2019, HPM Partners changed its name to Cerity Partners.
Below, George-Harik discusses her career, the challenges she has faced as a woman in a male-dominated industry, and ways that more women can enter wealth management sooner.
How did you get started in the industry? And what was your path?
It’s a very unusual one. I was working at my undergraduate alma mater in the dining area and it was recruitment weekend, where they brought in several people from different companies to recruit. And one of the young ladies in the working line with me was speaking Arabic. And so I was speaking with her, and the person that was a representative from one of the banks that was interviewing people came by and said, “What language is that that you’re speaking?” as I’m putting food on to her plate. And I told her and she said, “Here’s my card, come over to my desk, I’d like to talk to you.”
So I went and met with her and it appears that the bank was looking to develop and expand their Middle East desk because this was becoming a very important area for the United States to establish very good relations in, and particularly, financial relations. So they made me an offer. I was a senior that year. I went to work for them in Chicago, and at the same time pursued my master’s degree, which they covered. And then the first assignment that was offered was to go to Abu Dhabi.
And they thought that I would say no. And the second place would have been Greece for shipping. And I said, “No. I’ll take the Abu Dhabi one.” They said, “Wait, do you know what that’s like?” And I said, “I have a little bit of an idea and that’s why I’d like to go, because it will be more of a challenge.” I could always go to Greece. It’s more of a western country. So I went there and had an incredible experience personally, learning a lot about myself and about finance. I was responsible for sovereign wealth financial funding, and I stayed there two and a half years, and then was asked to come back to the U.S.
I helped establish an office in Cleveland then moved to New York and got involved in multinational lending, barter, and countertrade. And from there I went into the investment bank, this was now at Citibank, and then the corporate bank, then into private wealth management, which led me to being one of the co-founders of Cerity Partners in 2009. I was a linguist and spoke several languages and thought that’s what I was going to be doing in my life. I didn’t expect that I would get an offer to go into the financial world. I was curious, but had trepidation, because women, certainly at that time, were not encouraged to go into finance.
What other languages do you speak?
French and Arabic.
What were some of the challenges you faced in the earlier part of your career, perhaps even before you got into wealth management?
Definitely being a woman speaking to mostly male customers and clients. In earlier years, as a younger woman, the assumption is that you’re an assistant or that you really are too junior to be speaking to them. In fact, unfortunately, in two situations there were older gentlemen that were treasurers of a company and I was responsible for the relationship, and they refused to engage with me. They asked to speak to my male manager. And made a point of saying male.
Which is incredible. Actually, someone else I was speaking to, she said it’s just such a shame that it happens over and over again, that they just assume the woman’s the assistant, even in today’s world, and she said, “We have to flip it on its head. Why don’t you assume she is the boss?” It was a nice way of thinking about it. At least you wouldn’t offend anybody.
And I would think, even today, women are still asked to do tasks or be involved in projects that are not necessarily their responsibility or in their skillset sphere. You know, if it’s designing a new area or if it’s planning an event, and we women are multitaskers and definitely have skillsets that can accomplish those, but it’s always assumed that you should go to a woman for those tasks. As opposed to when it’s creating the financial plan for the client or something. It’s much different. So that those barriers still exist, not as much as they did a couple of decades ago, but they definitely still do exist.
How do we get women to look at wealth management perhaps in an earlier stage of their life?
I think it starts with their education. They have stock market games in high schools now, and particularly in larger urban areas. They need exposure to what is involved in finance, and it’s not just about the numbers. Certainly in wealth management, a liberal arts education is equally, and maybe more, valuable because you have the ability to converse with clients about all aspects of their life. You come with an understanding that asking questions and learning about people is more important than downloading a balance sheet. Big difference.
What are some of the obstacles facing women once they’re working in wealth management?
Not having had enough education in the field or exposure to it. A presumption that because you’re a woman you don’t know. And so there are obstacles simply by the other members of the workforce. As I mentioned earlier, I think, having enough self-confidence to take on something that’s quite different, that you weren’t aware of before.
And I believe today, a better understanding of what wealth management is. It’s not about selling somebody a portfolio of stocks and bonds. Wealth management is a very comprehensive art and it involves lifestyles of your clients and understanding those lifestyles, and having enough patience to learn about your client before you’re actually selling anything or making any sort of recommendations. And I think that’s the key. Women that are prepared to take the patience that they’re naturally born with and apply it in the workplace will definitely excel. But they have to believe that those attributes will help them in the position.
A lot of people don’t have that holistic approach. Right?
We say in our firm, we listen, we learn, and then we advise. So you have to begin a meeting hearing what your client says. You don’t walk in and say, “Oh, here’s your proposal.” Then the more you learn by listening, the more you understand what that client, or prospective client, what their goal really is. Then you help them get to that goal.
But you’re asking questions all along the way. Where do you go on vacation? Do you have children? What books are you reading? You need to understand the persona of that prospective client so that when you are interacting with them, you’re interacting in a way that not only do they believe that you really are interested in them, but you gain their confidence.
And knowing how they like to be communicated with is important, too. Right?
It’s very important because if you don’t understand how your client wants to communicate, there’s not going to be any communication. Some have an email preference, others a text preference or phone preference. And believe it or not, some still have a print preference. Where it gets tricky, particularly in finance and in wealth management, is texting and unrecorded calls in case there is legal action and you needed discovery. So many times we will text and phone with our clients, but then we will reconfirm.
Describe Cerity Partners’ investment philosophy.
Our investment philosophy is very customized. It’s important that we understand what are our clients’ needs, wishes, interests, and goals. But primarily most of our clients come to us with a goal of preservation of capital. It’s very important that we manage their risk and that we can maximize returns. That’s wrapped in three elements that inform our investment philosophy: transparency, independence, and customization.
As a firm, we established ourselves with no proprietary trading because we felt that the only way that we could be truly honest with our clients and offer full transparency is if we had the ability to do the research and analyze the managers that we were considering putting into the clients’ portfolios. And there’s a danger if you have a proprietary desk, that you’re always going to push that, and we never wanted to have that conflict.
So that’s the independence. The concept of transparency really just comes from when we first started the firm, during the great market dislocation of 2008, 2009. So many clients had no idea what was in their portfolio, what fees they were paying. They didn’t have investment policy statements. I mean, it was sort of a rodeo. And for us, it was very important to have that transparency, that our clients know what we’re doing all along the way, from early recommendation to analysis, to performance review, and monitoring. Per customization, no two clients are alike so we felt it was imperative to make sure that we had the ability to customize each portfolio for our clients. That’s more costly internally to the firm, but we believe that we have garnered longer term relationships with our clients because of it, because it’s not a commodity.
Are clients are more fee-sensitive today than they were 10 years ago?
Yes. And more sophisticated. There’s more information in the marketplace. It’s easy for them to garner information and make their own comparisons. So they do ask, particularly prospective clients, “What does your fee include?” or “What is the scope of work that this fee covers?” And I think that’s good. They should ask that and they should make comparisons. Now having said that, how do you price customization?
That comes with the rapport that you establish with that prospective client or client. If they are confident that you really are an advocate of their interests and that you truly are the trusted advisor, then they’ll pay a premium on that. It’s completely different than just someone that comes out of a brokerage firm. And I’m not being demeaning. But it’s just a different element. Private wealth management? Completely different from that.
What else are you seeing that’s a shift from the way your clients are behaving five or 10 years ago?
More clients are focused on wealth planning or financial planning. It’s not just about what’s in my portfolio today, but “I want to retire at such and such an age,” or “I want to pass on and create a wealth transfer event at a certain age to other members of my family. What will it take to get there with the investments that I have?” Or “How much longer do I have to work?” Or “Do I need to dip into any other assets that I have, my 401(k) or my pension?” or even Social Security if it’s still around.
So we have adopted goals-based planning and investment advisory. We spend a lot of time with our clients understanding their financial, wealth, and lifestyle goals, and then we work with them to determine what it will take to accomplish those in three years, five years, 10 years, 20 years, whatever horizon they give us.
That has definitely changed. That conversation was not being had. Those were separate exercises 10 years ago. You had estate planning, wills, maybe some trusts set up for the consumer and the client that was a business owner, entrepreneur. Clearly, for active wealth coming from inherited family and legacy families, that estate planning was already done, but today’s wealth creators in the country are focused much more on this goals-based planning.
What are some of your hobbies and interests outside of work?
Sailing, and anything on the water. I’m very fond of being on or near the water. That’s an important aspect of my life. Also, the visual arts. I spend a lot of time trying to appreciate that and trying to interpret history through art. And I love to travel. Most recently, I was in Patagonia. I went to the Galapagos islands. Before that, Cinque Terra in Italy. I think it’s very important also because it expands your mind. It helps you understand what really is going on in the world. We speak the speak about global, but we sometimes are so insular that our concept of global is only what we’re reading in a newspaper.
And I think it just makes you so much more well-rounded because clients can really connect with you on a personal level, which is essentially what wealth management is about. It is, you mentioned, lifestyle. It’s connectivity. It’s all these sorts of things. it’s people, it’s their lives, it’s not just their finances. So I think when they feel like they actually know their advisor and that they can connect with them on other issues that are important, it just sort of really deepens the relationship.
I’ll give you an example. I was introduced to the father of a prospective client, and he was considering also becoming a client. So it was the initial conversation, left a message, “Call me back, my son said that it might be worthwhile to speak.” So it took us a couple of days to get in touch with one another. And I finally called. He picked up the phone. I said, “Hello, this is Lorraine George-Harik.” He said, “Yes, how are you? I’m sorry that it’s been so difficult,” and I said, “That’s quite all right. If this is not a good time, we won’t speak.” And he said, “No, this is a great time.” He said, “I’m actually in the vineyards of my new property down in Patagonia.” And I had just come back from hiking in Patagonia. So he was so interested and amazed that we could have this conversation, not about anything financial or wealth management, but it created a link between us now about where he was.
I love that story. What has kept you motivated and excited throughout your career?
A client that sends you an email that says, “That was such a great meeting and thank you for all your help. What you’re doing for us is really amazing.” The fact that you can see that you’re making a slight difference in people’s lives is so important.
And I think the other aspect of that is, and for which I’ve been very fortunate, is mentoring within the firm. Mentoring younger colleagues and sharing with them where the challenges and rewards were and sharing what I would do differently if I had to do it over. And for that reason, I’m very gratified. I have an open door and many of our younger colleagues come in to speak with me. So on two levels, you know, with the clients and with colleagues.
Do you feel that younger people feel open and that they want that mentorship?
Yes, very much so. The world and our industry are very complex places now. And so devising a path that you think is right for you individually is so important and you want to get as much insight and information as possible. And if people are willing to share with you where they made mistakes or where they faced challenges and how they overcame them, that’s one step up, that’s education outside of the classroom. That’s invaluable.
And as I said, I’m really gratified that my colleagues trust that I will share that with them. There won’t be any concerns about, “Oh, will Lorraine be saying anything to anybody else?” Not at all. It’s very important to me. And I’m so happy that I see that they’re flourishing and making decisions that are really good for themselves. Because, particularly in this industry, you have to be happy about what you are doing, otherwise it becomes very cumbersome and mundane. Say you’re a doctor – you’re healing somebody. So you want to feel that you’re really making a difference. And I think that people that are passionate about this industry believe that.