Danos Group
31 Jan

Banking competition has been encouraged, over the last few years the market has become very diverse. In the past there was one universal banking model, but today there are many. Large challenger banks as well as the smaller challenger banks and FinTech firms with niche specialisms, now operate successfully across the market and require broader non-traditional hiring strategies for senior Compliance and Risk professionals. 

External v Internal

Heads of Compliance and Chief Risk Offices in early stage start-ups usually need to be hired externally, typically attracting talent from one of the big five retail banks or a nationwide. This type of external hiring is also seen across both small and large challenger banks. 

Challenger banks do hire from other challenger banks, with smaller firms offering great opportunities for individuals to take on broader roles.

Whist the big five banks typically continue to leverage their internal pools of senior individuals, by moving them up into senior Compliance and Risk leadership roles. Larger challenger banks tend to have a small amount of internal promotions, leveraging their team talent pools. 

Interim v Permanent

Executive interims and contractors are often hired at start-ups and smaller challenger banks, to enable them to manage their fixed costs. As these firms grow often interim executives are often offered permanent roles.

New businesses benefit from the board experience that interim executives can offer. There has been a rise in the calibre of senior Compliance and Risk professionals who have opted for short term contracts, rather than permanent roles.

Diversity 

Firms are actively looking to address the gender diversity, as historically only a small proportion of heads of Risk and Compliance at challenger banks are female. Many firms are actively looking to hire senior female talent and are offering talent development programmes to ensure gender diversity.

The hiring of both executive interim and permanent senior Rick and Compliance roles will continue to be in demand, as firms at different stages of their lifecycle, regulatory processes and growth will require different experience.

As a leading supplier of Compliance and Risk personnel to the financial services industry globally, the Danos Group are extremely well-placed to find you the best permanent and interim candidates.

We use our experience and market knowledge to help you land the best people for your roles.  Treating each client as unique, understanding the business requirements and advising on the best hiring strategies, to ensure you have the best and most appropriately experienced talent.

If you would like to find out more or would like our support or advice on permanent and interim resource solutions, please do get in touch.

Ruaridh Brown-Hovelt
Associate Partner, Head of Risk and Quant Practice (EMEA) – Permanent roles

Tel: +44 (0) 20 3889 5757
Email: rbh@danosassociates.com

Katherine Lord
Associate Partner, Head of Danos Consulting – Interim Roles

Tel: + 44 (0) 207 010 1153
Email: klord@danosconsulting.com



31 Jan

Since the last UK general election (December 2019), the Danos Group has experienced a significant surge in recruitment activity in the UK and across Europe. The start of 2020 is noticeably busier than early 2019. Confidence across the market has improved considerably, and the Danos Group has had its busiest ever December and January.

During the last six months of 2019 Danos Associates experienced an increase in search recruitment activity, despite the continued economic instabilities. Firms did not have the staffing resources to execute their business growth plans, and they no longer let the UK’s political indecisions hold them back. From the summer we started to see a significant rise in hiring August was our leading summer month on record. This then surged post the December UK general election and the confirmation that Brexit was going to happen.

Across 2019, we saw high recruitment demands across the European financial centres including Amsterdam, Dublin, Frankfurt, and Luxembourg, coupled with the continued growth of nearshoring centres across Eastern Europe.

The second half of 2019 was our strongest period in the North American market since establishing ourselves in 2014. Over the last year, we have seen our business grow beyond that of New York City where our US headquarters is located. We are now working with clients across the US, branching further into the Los Angeles, and San Francisco markets, as well as undertaking searches in Boston, Chicago, and Greenwich.  Our networks in all these markets have grown considerably.

As the nearshoring phenomenon continues in the US, we anticipate increased activity this year, as we support our clients in relocating teams to lower-cost centres, away from more expensive traditional Financial Services hubs. Even with the nearshoring trend, our clients in New York City continue to be very active, with lots of hiring occurring.   

Our Singapore office had a very strong second half of 2019, they delivered the best performance ever, this growth and demand is set to continue in 2020. We have seen rapid growth as new FinTech companies enter the market, and we are seeing a high demand for strategic or innovative candidates. The MAS (Monetary Authority of Singapore) fully support the importance of the FinTech opportunities as highlighted by their Managing Director Mr Ravi Menon, “Singapore’s FinTech journey is about innovation, inclusion and inspiration. Everything we do in FinTech must always have a larger purpose – to improve the lives of individuals, to build a more dynamic economy, to promote a more inclusive society”.

Despite Hong Kong being immersed in anti-government protests for months, there are opportunities, and it was recently reported by the Asia Securities Industry and Financial Markets Association, that the Hong Kong capital markets remain an important gateway between China and the world. Last year in the months of November and December our clients were hiring actively, and we continue to experience a good level of search activity in this market.

Danos Consulting had its best year ever in 2019, with demand concentrated predominantly across buyside, FinTech and the medium sized banking groups. 2020 brings a certain degree of transition due to the upcoming legislation, and the larger banking groups blanket approach of putting all interim/consultants inside IR35. Those firms taking a case-by-case approach are managing to secure some of the best shorter-term staffing solutions available. We expect the market to remain solid through the early part of 2020 and then pick-up rapidly post the IR35 implementation hiatus.

Whilst it is certain that we will continue to experience local and global challenges, our specialist teams will stay close to our clients and their markets, ensuring that we understand the ever-changing environment that they operate within. Whether it is the changes in regulation or the political landscape, we will continue to find innovative solutions to ensure our clients have the best talent in place to support and grow their businesses.  

If you would like to discuss your hiring strategies or consulting projects, then please do get in contact.

Dominic Danos
Global Managing Partner



23 Dec

A few months ago, we discussed why the Financial Services industry should care about achieving a diverse and inclusive workforce, and highlighted some of the benefits, including:

  • Diverse and inclusive workforces help businesses better relate to the global markets they operate within
  • Leads to higher employee satisfaction
  • More likely to have financial returns above their respective national industry medians

While it is great to talk about why diversity and inclusion is important, and necessary in today’s hiring landscape, the question remains as to how companies are ensuring they achieve these goals. There are many diversity and inclusion best practices that firms may use, but we wanted to highlight a few simple areas to consider, and that you can implement straight away into your hiring process.

In order to gain some insight into this topic we talked to Jennifer Brown, an award-winning diversity and inclusion, speaker and consultant, who boasts nearly 15 years of experience in this space. Her new book, How to Be an Inclusive Leader, hit the bookshelves this summer. 

Job Postings

From Jennifer’s perspective, if you want to build a diverse team of professionals, the first place to start should be the Job Posting. According to Jennifer, “Hiring requirements can be so narrow that they become biased themselves”. Her suggestion is to revaluate how you are writing job descriptions to stop unintended bias. This means eliminating gendered words like “compete”, “dominant”, or “adventurous”.

This is backed up by research from studies published in 2011, from the University of Winnipeg, by professor Danielle Gaucher, who found that “Gendered wording is common in male-dominated fields, and contributes to the division of traditional gender roles by dissuading women’s interest in jobs that are masculine worded”.

While rewording job specifications may seem like a daunting task there are tools out there like Textio, that help hiring managers analyse job postings for gendered and non-inclusive language, by judging it against a “bias meter”, which reflects how inclusive a job posting’s language is.

Firms are also finding success by inviting under-represented people to apply in the body of a job post. This simple prompt goes a long way in making a candidate feel welcome to apply.

Selection and Bias

Bias can also find its way into the candidate selection process. A 2003 study from the National Bureau of Economic Research found that, whether they intend to or not, recruiters tend to discriminate based on candidates’ names, and assume race/gender when screening resumes. There is an inherent tendency to “pattern match” while reviewing resumes, from Universities to previous Companies worked.

In order to eliminate bias in resume evaluation, Jennifer Brown suggests “Rethinking the reliance on the resume”. While looking at resumes, hiring managers should consider the bottom-line needs and criteria of a Company and evaluate whether a candidate has the skills to meet these needs.

Project Include, is a non-profit that uses data and advocacy to accelerate diversity and inclusion in technology recruitment. They write in their hiring guide – “Think about employing a ‘distance travelled’ metric: Where did a candidate begin their journey? Which achievements were accidents of birth and linked to privilege (e.g. an internship at a family or friend’s company) as opposed to earned in a meritocratic competition?”.

Outside of the interview and selection process, Financial Services firms have found that diversity and inclusion cannot be improved by better hiring practices alone. Therefore, Financial Services firms are investing in programs that offer mentorship and education for underrepresented groups. Programs like “Girls Who Invest”, are backed by firms like Oaktree and TPG, and strive to increase the number of women in portfolio management and executive leadership in the Asset Management industry. 

At Danos Associates we adopt at headhunting approach to our recruitment process. That means that we don’t have candidates apply directly to us. Instead, we actively go out and find candidates for each role, which means the onus is on us to find the best possible candidates for each job, using a variety of different metrics.

We take the time to meet with each candidate in person and get to know each candidate before putting them forward for your roles. We feel that we are uniquely placed to ensure we are doing our part to find diverse candidates and, in turn, the strongest candidates for each job.

We approach every search with an aim towards diversity and inclusion. While skillset and experience remain a focal point in our selection process, we strive to ensure that each shortlist reflects a diverse range of experience, culture, and backgrounds.

We pride ourselves on being able to match talent not just to the requirements of the role, but also to the style of the organisation.

Get in touch with us today to discuss your diversity and inclusion efforts and how we can assist you with your search and selection.

09 Dec

Given Danos Associates’ strength in the legal search space, we are keen to share the main talking points on an increasingly topical line of conversation with our clients. Along with our own expertise, we have collated together discussions we have had with C-suite executives and Partners in leading law firms, regarding the fundamental benefits of having an in-house legal counsel.

Reduction in legal expenditure

As your business flourishes, you may start to notice the rising legal requirements. With the increasing charge-out rates for external counsel, it is logical that you would want to find cost efficient ways of managing legal spend.

One effective way of doing this is by hiring a dedicated business lawyer.  With a lawyer working within your organisation, you could significantly cut down your legal outsourcing costs, particularly if the business needs are aligned with their area of expertise. In areas outside their remit, they are perfectly positioned to negotiate fees with external firms.

Whilst the upfront cost may seem expensive, you will be able to derive maximum value from the hire if you align the needs of your company with their expertise.

Trusted business advisor with vested interest in the growth of the business

In-house lawyers often play an integral role in the strategic planning process. It is common for a commercially astute lawyer to closely advise on the Board, contributing to the overall strategic mission of the firm.

The best in-house lawyers have in-depth understanding of the businesses they support, liaising with other support functions to achieve the objectives of the organisation.

As we have seen recently, shaky senior investor confidence can negatively impact a business. Having an in-house lawyer reassures these stakeholders that you are taking legalities and risk seriously, alongside the clear objective of having their best interests in mind, i.e. keeping their investments safe and secure.

Management of external counsel

In the instances whereby you may require work to be outsourced, Ii-house counsels are well positioned to identify the best individuals for this additional support or advice. They will easily pinpoint the legal issues and give direction to your law firms on the right legal advice needed for the given matter.

They will serve as a trusted liaison between the business and external counsel, again facilitating your firm’s best interests, whilst effectively translating any technical legalese into digestible information.

Identification and mitigation of legal risk

It is your lawyer’s job to identify, analyse and evaluate legal risks. A trusted permanent advisor will have a clear understanding of the business’ assets / product offerings, making it easier to deal with these risks.

They can work in unison with other internal stakeholders to put mitigating measures in place which in turn can limit the risk of disputes and damage to business reputation. This long-term foresight and continued monitoring will enable counsel to track risks and foresee where issues may arise, making their reactions much quicker.

In conclusion…

Hiring an internal counsel can prove extremely valuable in the long term. Focus on hiring an in-house lawyer well versed in dealing with the legal issues your business experiences daily to ensure that your outsourcing requirement is minimised.

As a leading specialist executive search firm, we have an unparalleled talent network within the Legal sector throughout EMEA, the Americas and APAC.

We pride ourselves on being able to match talent not just to the requirements of the role, but also to the style of the organisation.

If you would like to find out more, would like our support, or advice on permanent and interim resource solutions, please do get in touch.

18 Nov

What has been happening in Risk Management this year? As a specialist in risk recruitment for the financial services, I have good visibility of market movements and trends. Here are my market views and observations.

Regulatory Projects

The Fundamental Review of the Trading Book (FRTB), Basel III and Markets in Financial Instruments Directive II (MIFID) are regulatory projects that have been constant over the year. Going forward these projects will mainly be within FRTB and more specifically in Basel III and IRB (Internal Ratings-Based Approach) modelling within quantitative risk.

Consultancy clients are predicting a busy 2020 to support the implementation of the regulatory changes and in preparation many clients are keen to seek IRB modelers on an interim and permanent basis. The banks are starting to look at direct hires, but this is slow as their preference has been to use consultancies to provide interim support.

In December 2018, Ruaridh Brown-Hovelt, the Head of Risk at Danos Associates predicted a busy year for FRTB and gave an insight into industry views – The Questions Facing FRTB.

IBOR Reform

The need for more Interbank Offered Rate (IBOR) reform support this year has been a big trend and we expect this to continue and likely to get busier in the coming months and into 2020.

Many hiring managers across the industry on the sell side have acknowledged this and the rise in interim support for IBOR transitioning has increased. Candidates with expertise in IBOR and the understanding of how to transition to SONIA are in high demand and can potentially have multiple opportunities to choose from.

Ruaridh Brown-Hovelt, the Head of Risk at Danos Associates explains further about the transition – An update on the risk recruitment market: are you ready for SONIA?

On the buy side, only a few managers I have met during the year have flagged IBOR and the need for expert support, but those who have are very surprised at the lack of acknowledgement by the rest of buy side so far – this is an early indication that there will be further growth for specialist requirements in this area.

Technology Impact

With more functions and teams starting to find new innovative ways of implementing Artificial Intelligence (AI) and machine learning techniques into risk management, the need for more technical skills is on the rise. Quantitative candidates with knowledge of certain techniques and processes like deep learning, are increasingly in demand. Especially those with practical experience of applying said techniques to credit risk and anti-fraud.

Most of the banks are restructuring and hiring in the electronic trading risk teams.  Ruaridh Brown-Hovelt, the Head of Risk at Danos Associates wrote further on this earlier in the year – Recruiting for e-trading risk functions.

This is an increasingly competitive hiring space and we foresee more opportunities being created here in the coming months.

FinTech Boom

In 2019 we have seen successful European digital banks and FinTechs expand to support these growth markets around the world, with our global offices filling roles in this space. The speed of the growth creates the need for substantial hiring to cope with the new demands and creates the need to backfill rapidly.

The growth is great for new opportunities in the market, but divides opinion from candidates and clients who have experience from your more traditional retail or investment banks, whether this is something they would or could transition into. The main hiring activity we have seen and filled has been within the framework and regulatory reporting, as well as permanent and interim senior risk positions to help lead and develop the operations.

We have worked with very early stage FinTechs often with the need for experienced resource to design and implement frameworks from scratch, as well as more established firms which have needed to increase capacity to cope with the new workloads.

Katherine Lord, Head of Danos Consulting earlier in the year explained how big the FinTech market had already become and it has only continued to grow, now on a global scale – FinTech is a key driver in the recruitment market.

Conclusion

A year filled with so much change and uncertainty in the market is usually followed by a year of increased demand and decisiveness to get on and make changes. The market has seen a busier Q4 this year, with more headcounts being signed-off and most of the hiring for much needed replacements across the board.

In 2020 we foresee the need for structural changes, expanding and tailoring of teams and functions, and we expect an even busier year across the market.

If you are keen to hear what we are currently fulfilling or our market awareness, please feel free to reach out for a confidential discussion on how we can assist you with your search or provide you with right talent and expertise.

04 Nov

Card fraud poses a major threat to the finance industry. It has been recently reported that criminals stole more than £1.2 billion through fraud and scams in the UK in 2018 alone(1). These crimes can have a devastating impact on victims. And even if the customer gets their money back from their finance provider, the organised criminal gangs which perpetrate these frauds still profit from the proceeds. This money may go on to fund illicit acts which damage our society – crimes such as terrorism, drug trafficking and people smuggling.

The financial industry is committed to tackling fraud and scams, and the banking industry is proactively using technology in the fight against fraud. In September 2019 we saw the introduction of two-factor authentication, a Strong Customer Authentication (SCA) requirement for most electronic payments made within the European Economic Area (EEA). Under the new rules, customers making certain transactions online will now require a second level of security, such as a passcode sent via text message, or biometrics.

Biometrics is emerging as a formidable solution to support secure payment and banking options. Biometric fingerprint readers have grown in popularity and are now used in many major areas including banking, mobile phone security and as broader security controls.

Biometrics are currently being used to verify people through:

  • Facial Recognition
  • Fingerprints
  • Retinal Scans
  • Signatures
  • Voice Analysis
  • Palm Vein Identification
  • Hand Geometry

These techniques are also available but have not yet been as widely adopted:

  • Brain Waves
  • Walk Style
  • DNA
  • Heartbeat
  • Iris Scan

Using biometrics to verify identity is popular because it is convenient and reliable.

Biometric identification is in the palm of every modern smart phone users’ hands. People can unlock their devices with their face, eyes or fingerprints. But, as a result, this opens people and organisations to cyber risk and the possibility of biometric data being hacked and stolen.

Biometric data security, storage, compliance and regulation are concerns that negatively impact adoption of biometrics by consumers. With increasing numbers of data breaches year by year, people are afraid of what could happen if hackers steal their biometric data. Since a person’s biometrics cannot be changed if stolen, like a password could be, fear of losing biometric data holds back some acceptance of this technology.

The evolution of the payment and banking industries are driven by three key factors: technological innovation, regulation, and consumer adoption. In the case of biometric payment authentication replacing passwords, the technology and regulation is in place to allow for the new era of card-not-present transactions, but research suggests that consumers are not ready to relinquish their dependence on password authentication(2).

Biometrics could play an important role in the fight against financial fraud, with their uniqueness and technology ease, however the financial services industry will need to install consumer confidence by eliminating risks related to data security, usage and storage, as well as defining and implementing regulation compliance. Having the right talent who understand compliance and risk and can work alongside data scientists to drive technology innovation is paramount.

Danos Associates has over 15 years’ experience in the Payment and Fintech sectors internationally covering Compliance, Financial crime, Risk, and Legal. We leverage our knowledge of firms and individuals to help connect individuals to solve technical and regulatory issues and provide succession planning or search to fill team gaps. If you would like to discuss this article or your team, please do get in touch.

Paul Geist
Associate Partner, Compliance

Tel: +44 (0) 20 3908 4806
Email: pgeist@danosassociates.com

Ruaridh Brown-Hovelt

Associate Partner, Head of Risk and Quant Practice

Tel: +44 (0) 20 3889 5757
Email: rbh@danosassociates.com

References:

  • Fraud The Facts 2019
  • Lost in Transaction – Paysafe Group