You are here: home
News

Conduct Risk


27/08/2015 by Daniel Cohen

There is no getting away from the fact that it has been tough for front office candidates in recent times, a combination of prohibitive market conditions, roles being replaced by technology and geopolitical troubles to name but a few. Some have found reprieve in contract work, a lot of it within mis-selling and redress projects across both transaction banking and markets based business. We subsequently see an emerging area of demand which may offer further hope to front office profiles who are struggling to find work: Conduct Risk...
 
Now what is conduct Risk exactly? Well, although there is no official definition, it is generally agreed to incorporate matters such as how customers are treated, remuneration of staff and how firms deal with conflicts of interest.*

http://blogs.reuters.com/financial-regulatory-forum/2014/03/19/conduct-risk-an-overview/

And it is this first aspect which could have hiring implications: treating customers 
fairly. Banks are making noises about and indeed some have already embarked on an internal review of whether this is being adequately handled. It is not something that BAU staff can necessarily cover because the demands of the role make it a full- time job in its own right. Therefore we anticipate 2 things:

1) hiring of external resources into project teams designed to look at this under several banners, one of which will be conduct risk. Here at MW we have already been approached by multiple clients in this capacity

2)establishing full-time teams to maintain an ongoing internal review into a bank’s own conduct (a mixture of internal transfers and external hires).

However there is not a ready-made pool of conduct risk specialists available on the market. Any candidates who have conduct risk experience can expect to see urgent demand for their services but demand far outstrips supply here. Our view is that front office profiles are best equipped to satisfy this demand, consider the following:
Interestingly, a senior contact of ours at a tier 1 bank advises that their bank is not ahead of the curve as regards conduct risk “QUOTE”


No ready made workforce to meet this requirement – [BofA quote]
There may well be some demand for individuals moving from the consultancy industry on the strength of having some relevant project experience but this will not remotely satisfy the market appetite. Generally with a skills gap such as this, we find clients prefer to take a banking profile and develop the outstanding technical skills rather than a more accomplished consultancy profile.

Can demand be solved by the existing Risk market? According to a friend of the firm, one of the leading Risk recruiters in the market, there will be some synergy at least as far as Operational Risk candidates are concerned. “[Conduct Risk] is a quantitative as well as a qualitative area so lends itself well to a risk skill set”. Why Operational Risk in particular? Because candidates possess the relevant “key technical skills required to design and build a meaningful compliant framework; combined with the softer skills required to roll it out across the business”. Credit Risk and Market Risk profiles in contrast will be geared towards Regulatory risk type roles or remain in their respective risk verticals. However our contact also cites the hiring market in Ops risk as “buoyant” meaning that even with a degree of migration of talent from Ops risk roles, demand on both fronts cannot be met adequately. 
 
Thus to summarise, there is no official definition for conduct risk, banks will have a need to satisfy this requirement, they would need to do so through external resources, fully experienced and available candidates are insufficient in number and alternative channels such as consultancy and other risk disciplines will not offer the full hiring solution for various reasons. MW contends that these are the perfect conditions for the hiring of front office profiles amongst others into such roles and we hope that this will bring cause for optimism back to some very talented profiles who are seeking work. Watch our website for job vacancies in this and related project fields.
 



Category: Recruitment Author: Daniel Cohen

Clients Get in touch
t
0207 199 6263
finding the right person for the right role

Get in touch
t
0207 199 6263
e
info@mwrecruitment.com
finding the right person for the right role