2011 – THE YEAR IN RETROSPECT
There is no doubt that 2011 was a challenging year in the Risk and Compliance professions. We saw a lot of uncertainty with clients and candidates in relation to hiring activity. There were recruitment freezes, downsizing, restructures and a general tightening in opportunities. We saw a year where cost control coincided with the early stages of maturity of the risk and compliance functions. We believe that this led to a net reduction in the number of people employed in risk and compliance across the financial services sector.
In compliance there were few key drivers of change from the regulatory agencies, with no new major pieces of legislation and it was pretty much business as usual. There was some attrition in compliance from consolidations such as AXA/AMP and losses such as MF Global. In risk management we experienced somewhat of a hiatus as risk professionals grappled with a profession approaching a level of maturity. Issues such as risk appetite, enterprise risk, risk culture and where risk should sit in the organisational framework were major themes. There was demand for those who could articulate clearly on these issues and demonstrate their value at an executive level. The integration of strategic risk onto the governance agenda in board rooms created opportunities for senior risk managers with an appreciation of enterprise wide risk.
2012 – THE YEAR AHEAD
Clients will be more insistent upon a broader set of skills. Candidates will be expected to really understand the business and have the ability to influence and drive change as well as have a level of commerciality and pragmatism.
We will see more rapid growth in risk management functions outside of the financial services in sectors such as energy, but coming off a low base.
Risk and Compliance will be less of a “bolt on” function and increasingly will become integrated into business’ decision making, whilst still having separate reporting lines. The move to the three lines of defense with compliance and risk imbedded in business functions as the first line of defense will continue.
The cost efficiency drive will continue from last year; with risk and compliance functions being integrated in the search for cost savings. Clients will prefer to recruit at a higher level of competency whilst reducing overall headcount, with those on staff asked to work harder for the same compensation.
The trend towards establishing enterprise wide risk functions that integrate all risk categories will continue (we have just recruited 2 Heads of Enterprise Wide Risk management). With new legislation coming through such as FOFA and PPSA and the regulators becoming more aggressive in policing existing legislation, we expect the volume of work for compliance officers to increase, particularly in the smaller shadow broking and advisory sector where resources are already under stress. This will continue to put pressure on what are now relatively lean risk and compliance functions. It remains to be seen if the industry makes the necessary investment to deal with these challenges.
We anticipate continued growth for contract resources, with demand stemming from special projects, maternity leave and uneven work flow. Also, there continues to be a positive trend towards temporary candidates going permanent.
REMUNERATION AND CAREER MANAGEMENT
Risk is still evolving. There is an increasing demand for the more rounded individual. There is still a shortage of candidates capable of displaying the ideal skill set (including, a level of commerciality, technical skills, people skills, relationship building skills, understanding the business, etc) and therefore the remuneration for the top 20 – 30% of candidates is increasing at a rate above market trends. However, the median increases in remuneration are reflective of CPI whilst the remuneration at the senior / executive / top end is at best flat and perhaps on the decline.
Although compliance is relatively mature, the increasing pressures and demands for a broader skill set should push the remuneration up a level.
Internal audit is also relatively mature but again, there is a strong demand for high calibre candidates (i.e. with the ideal skill set). The top tier candidates can continue to expect a premium.
There is still a premium for candidates moving from the BIG 4 CA firms to internal audit and operational risk, particularly at the newly qualified levels.
The candidate perspective hasn’t changed dramatically. Candidates are more acutely aware of the value of branding i.e. working with a solid organisation with a well-respected risk, compliance and audit function.
They are conscious of security in the workforce and have also become increasingly aware that staying in the one role for too long can be seen as being complacent from a future employer’s perspective.
ABOUT US
The Team at CRM Recruitment includes Barry Maurer (Director), Greg Goodman (Director), David Bakes (Senior Consultant), Tonya Goode (Researcher) and Angie Ilagan (Office Manager).
2011 was a good year for us overall with a 35% increase in placements in the second half of the year together with an increase in our contract revenues. As a specialist agency we spent a lot of time helping both clients and candidates to understand the market dynamics and in providing advice on career opportunities.
During the course of the year, we relied less on responses to advertisements, relative to our ability to source through our database and our strong internal and referral network.
We work very well together as a team and our combined experience in the risk, compliance and audit sector enables us to thoroughly understand our clients and our candidates.
