Asset and wealth managers hunting for compliance professionals to help tackle the ever-increasing regulation in the industry has driven up salaries, drawing more people to the jobs.
With the onslaught of Mifid II, Solvency II, AIFMD and Ucits V, the finance industry has ramped up hiring to help decipher the regulation and prepare firms.
Many asset and wealth management firms have seen a “massive increase in headcount” of their compliance department, says James Findlay, a compliance expert at recruitment firm Selby Jennings.
This demand, combined with the sparse talent to fill the roles, has seen salaries in the sector sky rocket.
Research from Emolument, which crowdsources pay data, shows that on average compliance staff at managing director level in asset managers are being paid more than £107,000. Those at director level are being paid just over £97,000, while more entry-level analyst roles are getting £41,500.
While this is lower than the equivalent roles in investment banking, it marks a large rise on previous years.
While junior staff a few years ago would have been paid around £30,000 that has now risen to £40,000 to £45,000 now, says Kristian Tennick, manager of compliance at recruitment firm Oliver James Associates.
Those with two or three years of experience are now taking home at least £50,000, while higher-level people with specific skills are taking home far more, he says.
A Ucits specialist, for example, would have been paid less than £80,000 a few years ago, but now that same person with four to six years of experience can garner £90,000 to £110,000 “as standard, if not even more”, Tennick adds.
The growth is not stopping here, he says: “It’s an area that has gone through incredible growth. I think it will continue to go up,” he says, as more managers look for the right staff to bring on board with a specific skillset, meaning those people become “very sought after and salaries end up going up”.
The power very much lies with the candidates when it comes to the compliance side of the business, with a shortage of good people being available, says Findlay.
“There is not a huge talent pool to pick from so it’s quite candidate driven market for top positions, unlike other areas in banking and finance which are still a firm driven approach in where the power sits. That will change in the next couple of years,” he adds.
For this reason people from other job roles in the wealth and asset management industry are now moving to compliance.
Before the last credit crisis compliance was not held in as high regard and was seen as an easy job to get into, says Tennick, but “now there are people across the industry actively leaving their current post to seek a career in compliance”.
In particular, Tennick sees front office staff, such as sales people and relationship managers, moving across to re-skill in compliance. “It is much more interesting now … salaries going up makes it more enticing and it is seen now as a stable career if you’re doing a good job.”
One factor that helps boost the appeal of the compliance side of the business is that it has seen few redundancies, says Tennick, unlike the front office side.
“Front office staff have seen a lot of redundancies, their margins and profit due to regulatory pressures are decreasing, compliance on the flip side has been more busy and more lucrative,” he adds.
These staff moving from other areas of the business are also helping to push salaries higher, says Findlay. He gives the example of an FX trader who retrains and moves to the compliance side. “That candidate’s higher previous salary means the whole system goes up,” he adds.
Financial services firms are welcoming those from the front-office, client side as they are looking for compliance staff with great communication skills, says Findlay.
“They need excellent communication skills, it’s not just a coding or very, very middle office function, they have to be facing off with strong minded portfolio managers, heads of trading, investment officers,” he says. “They need that confidence and being erudite, as close to a lawyer without being a lawyer.”