By Andrew Welsch

Nearly six months after suddenly becoming CEO of LPL Financial, Rich Steinmeier is settling into his new role and setting his sights on a new North Star for the wealth management company.

"I think the firm narrowly defined itself as an independent broker-dealer," Steinmeier tells Barron's Advisor. "It competed in a narrower segment of the industry. I'm saying we are reclassifying this firm and competing against Merrill Lynch, Morgan Stanley, and Charles Schwab. Those are great firms. We intend to be better. We want to support advisors better than anyone else."

LPL is already a heavyweight, with about 29,000 financial advisors and $1.7 trillion of assets, but Steinmeier wants it to become "the unparalleled leader in wealth management."

Steinmeier took over the top job in October after LPL's board of directors terminated former CEO Dan Arnold earlier that month for unspecified statements that violated the company's code of conduct. Steinmeier previously served as chief growth officer and had joined LPL in 2018 after holding senior leadership positions at UBS and Merrill Lynch. He declined to discuss Arnold's departure. Steinmeier says that while his ascension to the CEO role was unexpected, he felt prepared to take the helm.

"I felt I had done the work to invest in myself, to understand the industry, to build a followership at the firm, and to be able to demonstrate leadership within the firm," says Steinmeier.

That said, he has still had to acclimate himself to certain aspects of his new job. He now has responsibility for a much larger number of employees and is taking on unfamiliar tasks such as writing the annual letter to shareholders.

"The set of stakeholders that I have deep responsibility toward has expanded," he says.

Steinmeier says he's also spending more time thinking about the overall strategic direction of the company and its aspirations. To achieve his goal of making LPL an unparalleled leader, the company is making further investments in its capabilities, looking at ways to be more efficient, and placing renewed emphasis on its employee appreciation, Steinmeier says.

"It's so critically important to have the best talent," he says. "But you have to create an environment that the best talent wants to be at and stay at. So we are thinking a lot about how to source, motivate, and retain the best talent in the industry."

The San Diego-based company is also exploring ways to improve workflows and elevate the customer experience while it simultaneously thinks through expense structures, according to Steinmeier. "It's a change in terms of how we make investments," he says. "I would say there is a subtle shift in making the process smoother. If we hear we are less than ideal in a particular capability, we want to fix that. And that pays off in better efficiency."

LPL's costs were also a topic of discussion during the company's fourth-quarter earnings call in January. LPL's fourth-quarter expenses rose 35% year over year to $3.17 billion for the fourth quarter. It's worth noting that the company's earnings per share handily beat analyst estimates for the quarter, and its stock rose on the Jan. 30 earnings report.

But like other financial stocks, shares of LPL have struggled this year amid growing concerns about an economic slowdown. LPL's stock is up 0.1% this year compared with a 4.3% decline for the S&P 500.

A broad decline in equity markets could crimp fee-based revenue at LPL and present a hurdle to LPL's growth and advisor recruiting efforts. Steinmeier says that there is a silver lining to market volatility because investors seek out financial advice during times of adverse market conditions.

"If you are self-directed and are worried about your investments, you go look for advice," he says. "So I think people look for advisors and, above all, quality advisors."

He adds that while a downturn may hinder recruiting moves in the short term, it also may prompt advisors to re-evaluate which firm they should be affiliated with.

Looking ahead, Steinmeier hopes that LPL's staff will see how much the firm is investing in itself and them. "If I were to have a report card, I would really hope that a year from now employees will be with us on this journey," he says. "And I hope I am personally connected with our employees and our clients, and that they see we are exceeding their expectations."

Write to Andrew Welsch at andrew.welsch@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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March 24, 2025 08:00 ET (12:00 GMT)

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