Competition heats up for compliance talent amid regulatory change

risk management compliance recruitment Kaizen Recruitment regulation

26 February 2024
| By Jasmine Siljic |
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As persistent regulatory changes continue to drive demand for risk and compliance teams in financial services firms, competition is heating up in the shallow talent pool.

In a market update, Kaizen Recruitment has shared its insights on the current landscape for compliance and risk employment.

“Regulatory demands remain persistent 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, competition for the best talent persists,” the recruitment firm stated.

Large-scale mergers of diversified financial services businesses alongside increased pressure from regulators have been identified as two key drivers of demand for compliance professionals.

Moreover, Kaizen has qualitatively observed unusually high levels of staff attrition on risk and compliance teams due to increased workloads. This is also coupled with structural risk project work across organisations, therefore stretching the capacity of lean teams.

These challenges have been further exacerbated by businesses’ internal time to hire vacant roles, which is taking approximately four to six months.

“With time to hire at an all-time high, this leaves current staff to cover the existing workloads, and middle and senior management seem to be bearing the brunt of picking up the workloads in these under-resourced teams.

“The most concerning trend we have noticed is surrounding senior candidate burnout in firms at the end of 2023, with candidates opting to resign even without a new opportunity secured.”

Kaizen pinpointed AMP’s ongoing remediation projects as an example, with their wealth risk and compliance candidates often having “highly repetitive and administrative narrow skill sets for the past couple of years”.

Last year, ASIC provided a final update on the progress of remediation associated with misconduct in the financial advice space, including fees for no service claims and consumer harm caused by non-compliant advice.

It reported as at 31 December 2022, a total of $4.7 billion in compensation had been paid or offered to approximately 1.6 million consumers. Specifically, AMP offered or paid over $636 million in remediation to more than 340,000 customers.

The recruitment firm described the key skills in demand for compliance professionals. Namely, these were investment and market risk, investor reporting, ESG and sustainability risk, regulatory compliance and financial crime.

Looking ahead to 2024, the recruitment company expects the trend of niche skills and higher competition for compliance staff to persist.

“We forecast the shallow skill sets of risk and compliance professionals, particularly in superannuation and funds management, will continue into 2024 as organisations compete for niche skill sets as they all mirror the same scaling in preparation for regulatory changes impacting business.”

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