‘Game changer’: Schwab’s Neesha Hathi on AI in finance, opportunistic careers, and the leadership framework that has propelled her

Welcome to?Human Capital, an open exploration of the ideas and people moving financial services forward. In each edition, we feature a leader or rising star who’s changing the game in his or her own way. “Finance is an apprentice business,” one often hears in this sector. Here are some of the teachers. Click Subscribe above to be notified of future editions.

Neesha Hathi thought she was done with finance.

After several internships in different parts of the industry, she didn’t see a fit for herself. She “ran away” to graduate school, hopped between tech startups during the dot-com craze and crash, and then paused to take a breath.

Twenty years later, she leads one of the most important businesses at financial services giant Charles Schwab .

What happened in between? That’s what I was curious to hear when I recently sat down with Hathi, who will notch two decades with Schwab in February. Previously the company’s chief digital officer (I interviewed her in that role at the South by Southwest festival a few years ago), Hathi now leads Schwab’s wealth and advice solutions business. But technology remains near and dear, so naturally topics such as artificial intelligence’s promise for financial services came up as well.

Below are excerpts from the conversation.

As is the case in the workforce today, in the investment world the demographics of investors — your client base — are changing. What challenges and opportunities does that present?

At a high level, we’re at a time when a lot of newer investors have come in since the pandemic, and more of them are engaged at a level that previous generations hadn’t been. At the same time, you have a population that’s both aging and living longer, and in many cases don’t have enough for retirement. So, one of the biggest things that we deal with is thinking through how to serve such a broad spectrum of investors.

There are some needs and sub-trends that are unique — for example, if you’re aging and retirement-eligible, you’re thinking about health care and longevity and not wanting to outlive your money. If you’re a younger investor, you may not be oriented toward retirement; you might be thinking more about alternative assets, or you might be seeking out a one-stop shop with digital capabilities for your financial life.

But what’s interesting to me, especially in the role I’m in now, is the similarities across different types of investors. One of the big ones is that demand for advice is growing. That includes the willingness to pay for advice, which you wouldn’t really think of for younger investors, who are thought of as being more self-directed. Our research is showing that a lot more millennial investors, for example, have already started working with a financial advisor than previous generations had at their age. And of course, then you have those who are more affluent later in life, who are also looking for advice.

Another trend, of course, is the growing power of the female investor — whose investing power has tripled in 10 years. That is just a dramatic shift that we as an industry cannot ignore.

All women investors are not the same, but there are commonalities. They tend to index more highly in planning, and planning for the long term. They tend to want to align their values with their investing goals. Things that are more socially oriented tend to resonate more. These are things that we think about with our offerings and how we go to market.

The last one I would mention is increasing interest in family involvement. Intergenerational wealth transfer is happening, and it’s set to accelerate from the boomer generation. As that occurs, there is more interest in families working together — affluent parents wanting to get the grandkids involved, for example. That kind of family generational planning creates a whole new dynamic and a different level of complexity.

What role is technology playing today, both for the financial advisor and for the investor? How do you see that evolving?

I think it’s now fairly established that the value proposition is both human and digital, integrated together. That demand is clear across the entire client base, in all the demographics we talked about. Though you do see younger investors much more likely to move to another firm if they’re not getting a technology-oriented experience.

What we get excited about is all the emerging technology. AI, natural language processing, machine learning — all of those are capabilities that we have deployed in targeted ways, such as our chat-bot experiences on the web and mobile app, or the models that we use to help our financial advisors understand the risk of attrition of a client.

But when I think about generative AI and what we can do with it, I get super excited. In the near term, given that the technology is still emerging and maturing, I think a lot of the applications we’re going to see will be what I call ‘supercharge the professional,’ which is like having a really smart person in your ear. We, for example, can take all of the content and data from the 50 years that Schwab has been around and bring it all very succinctly to an advisor at the time that they need it — that’s extremely powerful. It’s both an efficiency for the firm and a better experience for the investor.

Our first pilot around generative AI is knowledge management, which a lot of firms are looking at, where you have the professional who picks up the phone when you call and now they have access to a better way of getting the information to answer your question. Which form do I need for this? How do I open this kind of account?

Enhancing advice around wealth management is where I get really excited about AI’s potential. Think about being able to serve, in an extremely personalized way, any investor who doesn’t have as much in assets or investment education, and then continuing to support them along their journey of wealth accumulation and management.

Generative AI can synthesize, create, and deliver hyper-personalized content in real time at every step in the investor’s journey. That’s a game changer.

We have a new offer in this area that we’re working on right now, which is focused on retirement and meant for clients who have a lot of questions regarding retirement, social security, Medicare, and the like. Answers to those questions are almost always tied to rules — written content. By putting that content into an ecosystem with both generative AI and a human professional, it’s a powerful combination.

We’re always talking about democratizing investing, and I think this next phase is about democratizing wealth management, in large part by leveraging these powerful tools like generative AI and automation.

Why and how did you get into financial services?

My husband used to tease me that I had ‘job ADD,’ because I like to do a lot of different things. I grew up in an entrepreneurial family — my parents were immigrants, and they had an orientation toward small business. I always found finance intriguing, especially watching when they needed to raise money for their business.

I could see the economic independence that a grasp of finance could create.

But I don’t know if I picked really well at the beginning. When I was in undergrad, I spent my summers doing an internship at the Chicago Board of Trade. I’m dating myself because there’s no floor anymore, but I worked on the trading floor in the commodities pits — soybeans and corn — and spent a couple months every summer in that environment thinking it was a form of financial services that would be interesting and fun. And I walked away never wanting to do it again. It was very transactional, and just not the kind of culture, especially as a woman, that I wanted to be in at that point in my career.

After graduating, I tried investment banking thinking it might be a different culture. What I found was it was quite similar in that it was also very transactional. But it was an incredible learning opportunity, and I learned a ton. Still, I kind of ran away to business school after that as a way to transition out of those environments.

I thought I was done with financial services, even though I kept that intellectual interest in it. I moved to California, I let my Series 7 lapse, I went to business school, and then I joined a technology startup — and loved it. I kind of caught the startup bug. I worked at a few startups after business school, and then after we sold one of them I took a breath and was trying to figure out what to do next. One of my business school classmates kept saying I should talk to Schwab, which I put off for probably six months because I thought I didn’t want to return to financial services. Finally I did an interview and thought, OK, let me try this.

To be honest, I thought I’d be here for a year or two. Three months from now, it will have been 20 years! The takeaway is that it was not well planned; it was all opportunistic along the way.

Tell me more about being ‘opportunistic’ — what does that look like, and how do you advise others to think about it?

One thing I knew for sure walking in was that I thrive on change and being challenged. Hence why I did not think I’d be here 20 years later — you typically don’t find that in one organization for very long.

Actually, on my first day, I walked in and they told me the role they had hired me for had been kind of eliminated. I was like, should I go home? Instead, they quickly gave me some reading and put me on another project.

After that, the only job I ever actually applied for here was about five to seven years in — and I didn’t get it! But that means every other job that I’ve held here came about because I worked with someone from another team who then put a word in, or I got to work with a leader who perhaps saw something in me that I didn’t. And then for more senior roles, often it’s a tap on the shoulder because of the credibility and the experience that you’ve built over the years by moving around and understanding the company in deeper and broader ways.

So, I always tell people that making it clear that you have aspirations to grow, that you’re adaptable, and that you’re willing to try new things is really important. It also sounds obvious, but is important to remind people, that just doing good work consistently is how you build credibility.

Are you delivering good work? Are you optimistic, adaptable, and open-minded? Then the opportunities come.

The last thing, which people sometimes don’t like, is the networking. I actually talk about it as gardening: Build your garden, plant new relationships, and then nurture them. People you worked with years ago will bring you opportunities, and vice-versa. That has been key for me.

As your roles became more senior, what would you say were the leadership principles that guided you?

First, one of the benefits of moving around a lot is that you work with different people and leaders, which in my case allowed me to pick up on the things that I liked and worked well, while also realizing what I didn’t like. My leadership principles have been built on that experience.

I have this acronym that I often use when I’m talking with folks who are earlier in their careers: VEST. It stands for vision, empowerment, service, and to say thank you.

Vision is extremely important as a leader, and I think it’s a responsibility to develop a vision for and with your team. In a few of my roles, including the one I’m in now, I was asked to stand up a new enterprise where there wasn’t one before. In those situations, when there’s no playbook, vision comes first.

Empowering the team is a principle that I’m a big believer of. I know I’m not the smartest person here, so we need everyone to be able to support and engage and move things forward.

Service, to me, is about serving the team. A leadership role is a responsibility — you’re there to move roadblocks out of the way. Most of the time, you’re not the one with the answers or even making the day-to-day decisions; you’re there to support and serve the team.

And then thankfulness is about being genuinely appreciative of the work that goes on and the effort that people put in. You strive for the good outcomes, you strive for success, but also remember that recognizing and appreciating good work will build a strong culture and the longest-lasting relationships.

As one of the most senior women in the industry, what advice do you offer to early-career women or really anyone looking to blaze a trail in the way you have?

Doing great work is table stakes. Once you have that, there are a couple other things.

One is the concept I mentioned earlier of growing your garden — having a robust network. I can’t stress enough how important that is.

The other is risk-taking. I was fortunate in that my parents were entrepreneurs, so perhaps this was in my DNA a bit. You have to try, even if failure is possible or even probable. I have definitely had some failures, and I can say that what you learn from those experiences is invaluable. You’ve probably seen the research that shows women are less likely than men to apply for roles if they don’t meet just a few criteria — I think that holds too many women back.

Also: Remember that it’s possible to have both personal success and professional success. That doesn’t mean it’s easy. But it’s absolutely possible.

In their strive for perfection and their fear of failure, many people — not only women — miss out on taking appropriate risks throughout their careers. That’s why I always push people with the message: Just try it. You won’t know what you’re capable of if you don’t.

Join the conversation with your own take on these topics in the comments below.