Wealth Perspectives

Approaching Corporate Executives


Michelle Black
Head of Wealth Advisory, Capital Group
Private Client Services

Forming advisor relationships with corporate executives requires more than just a knowledge of financial planning around stock options and other equity compensation. Most corporate executives already have mental plans for what to do with their equity compensation, says Michelle Black, wealth advisory senior manager at Capital Group Private Client Services.  Forming advisory relationships with executives requires a broader understanding of their financial situations, which includes understanding their goals and fears.




Michelle Black, Wealth Advisory Senior Manager at Capital Group Private Client Services

Building a practice around corporate executives requires more than just an understanding of how equity compensation works. Sure, it’s important to know the differences between RSUs and restricted stock, or NQSOs and ISOs. But to really connect with executives, you need to know what their motivations and their fears are.

Typically, senior executives exercise options faster than lower ranked employees. Now, this might be due to overconfidence in the company, or just politically, they want to demonstrate loyalty to the company.

Other executives exercise and sell their shares because it’s looked at as a way to supplement their lifestyle requirements. That said, almost all executives take mental shortcuts when deciding what to do with their equity comp, because they’re busy, and they often use rules of thumb. But what we heard loud and clear in interviewing dozens of current and former corporate executives is that they want help in looking at their holistic picture. They feel they already know how to handle their equity compensation, but they need help in coordinating it with their trust and estate planning and their taxes.

This is where you, as an advisory, can really shine. So when working with corporate executives, it’s important to not lose sight of this by focusing too narrowly on their equity compensation. Show them how to navigate through the waters of their other financial planning needs, and that will help demonstrate why they should be working with you and your team.


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