Risk and Compliance Market Update – August 2022

There has been a continued growth of risk and compliance teams within financial services organisations. After the Royal Commission there is still a true commitment to creating a mature infrastructure of risk and compliance within these businesses. Regulatory demands have risen with no signs of slowing down and given the shallow pool of candidates with in-depth experience within the different facets of risk and compliance in Australia, a war on talent has ensued.

Key People Challenges: Attrition, Retention and Attraction

The consensus amongst organisations and teams have been the struggle balancing workloads within existing team members, whilst managing resourcing constraints and trying to recruit for their teams.

Demand vs. Supply remains a key theme in the industry as top talent in the space remains fairly shallow and has been increasingly competitive. The current risk and compliance market is especially buoyant, with a continued war for local talent proceeding despite Australian borders opening in the past months.

This, combined with an increased demand for niche skill sets such as:

• Investment compliance;
• Superannuation regulatory expertise;
• AML/KYC and financial crime; AND
• Enterprise/operational risk and compliance experience.

This has organisations competing for high calibre senior candidates to help build and support their teams through large multi-year transformations – which has resulted in an upward pressure on salaries.

With a lack of talent in the market, candidates are less open to taking on short-term contracts in favour of more secure and permanent options. This has put serious pressure on teams as they approach regulatory reporting seasons, which continue to expand and funds under management are undertaking large scale technology and transformational uplifts throughout the business.

Salary increases for risk and compliance professionals at the junior level has been the most challenging. This has been due to the retracted graduate talent pool coming from the Big 4 Consulting firms, combined with a complete loss of international talent arriving in Australia who are searching for their first local position in the market for the large part of the past two years. This has resulted in the largest salary increase since the Royal Commission with candidates taking a whopping 66% leap from a previous entry level salary of $60K to now entering the market last quarter at a $90K salary. Such a major increase has resulted in a misalignment with Hiring Managers expectations compared to what talent, skills and experience is out there in an incredibly retracted talent pool.

In the past 2 years SEEK has found that the need for risk, compliance, governance, and audit candidates has jumped 20%. This massive rise in requirements in contrast with a contracted suitable pool in available talent has contributed to a key skills shortage in top tier risk and compliance professionals in the space.

Key Themes: What Are Organisations Doing to Retain and Attract Staff

Last quarter saw a continued trend of candidates receiving multiple offers at a time or counter offers from their current companies as organisations attempted to retain their top talent. A key issue is that while entry level salaries have been climbing, the remuneration within organisations have remained largely stable. This stability has been a key push for employees looking externally for new opportunities to capitalise on this rise in salaries. The issue for organisations on how to benchmark current staff and the strategies to maintain a fair and competitive remuneration schedule was echoed by almost every organisation Kaizen Recruitment partners with.

Employee Value Propositions Are Increasingly More Important To Staff

Some firms were able to articulate key points of their Employee Value Proposition (EVP) that both fulfilled employee desires and commercial competitiveness – such as an excellent Rostered Day Off (RDO) scheme where employees can gain up to 13 additional days of leave on top of their annual leave. This was a critical piece of their culture where the C-suite and Senior Leadership Team took these days to help drive the culture and comfort of taking these additional days throughout the year as to invest time in their wellness and work life balance.

While organisations continue to unpack what strategies and options they may utilise to increase their EVPs, there was a clear recognition on aligning career development opportunities to help retain staff and an acknowledgement of offering flexible working arrangements – which is largely a norm in today’s hybrid working strategies. Senior leaders have emphasised strategies such as:

• Budget increase for learning and development;
• Remote working to facilitate spending time with families;
• Spiritual and volunteering leave; AND
• Strengthened parental leave plans and recognition programs.

Many organisations continue to transform their attraction and retention strategies to compete for the best talent in the market. Kaizen Recruitment is continuously looking to understand and represent these offerings to act as an extension of our client’s brands and value propositions in the market as we look to match our candidate’s career aspirations with our client’s needs.

For any enquiries on recruitment please contact Amanda Chisholm, Manager – Legal, Risk and Compliance on 0412 123 726 or at amanda@kaizenrecruitment.com.au.

Kaizen Recruitment specialises financial services recruitment across funds management, wealth management, superannuation, investment consulting and insurance. We are based in Melbourne and Sydney. For assistance or further information please telephone our office at +61 3 9095 7157 or submit an online form.

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