Across the world, banks have been increasing the scale and mandate of their middle and back office teams since the height of the financial crisis, as a stronger spotlight is shone on issues of governance and regulation. The Asian region is no exception to this trend. Indeed, the new poster boy of the world economy has seen its financial institutions (both local and international) placed under increased scrutiny, from overseas HQs and onshore regulators.
“Asia Pacific is our ‘jewel in the crown’ and we will employ all available methods to ensure that we recruit the best talent for our firm. Whether that is utilising internal firm mobility or external recruitment, from within Asia or outside the region, we will ensure that we have the right people in place to deal with the challenges that we face as a firm.” Global Resourcing Business Partner, US Investment Bank
There has been significant global regulatory reform being introduced following the recent financial crisis of 2008 and many of these pose potential issues for the Asia Pacific region due to the complex, wide ranging and inadvertently overlapping nature of these changes in regulation. The US Dodd-Frank legislation, European Market Infrastructure Reform legislation, G20 commitments, the Basel III Capital Accord reform and the Markets in Financial Instruments Directive (Mifid) review are directives (and/or guidelines) that would keep Asian regulators and a legion of lawyers busy for many months to come. These regulators and therefore also Asian Financial Institutions, are seeking to identify areas of regulatory overlap that are potentially contentious and may conflict with present local markets regulation. There is no doubt that continued economic development in Asia will present a huge amount of opportunity and challenge to workers who are willing to make a move; indeed, any future leader in financial services would do well to secure a posting to the region for a meaningful period of time over the next decade.
However, the land of opportunity does not come without risks. Some clients, it would seem, are keen to hedge as much of this risk as possible when it comes to securing new talent; candidates need to adjust their expectations accordingly.
From an expat candidate perspective, the traditional use of compensation as a hedge for relocation risk is less dominant: expat packages still exist but the trend is towards reduction and gradual phasing out of such packages. When making an experienced hire, many clients will demand the local knowledge which is a value-add to their business:
- Legal departments will typically seek individuals with regional jurisdictional knowledge and language capabilities first and foremost;
- Risk Management teams may look for an in-depth understanding of country risks, as well as that of local counterparties and trading environments;
- Compliance leaders will seek out those who already hold valuable relationships with local regulators.
“Within our global footprint we see Asia as the region that has the most potential growth for our organisation at this time, that said we also see it as the region that carries the most significant regulatory risk” Regional Head of Compliance, Asia Pacific at a major investment bank.