hiring has ground to a virtual standstill in the wake of the
subprime implosion, asset and wealth management firms are now
driving the demand for talent for the first time in memory,
analysis shows.
A survey by executive search company Russell Reynolds Associates
found that demand for chief investment offices across the industry
is now “off the charts”.
The fevered search for wealth specialists comes as companies expand
to meet expected growth opportunities posed by baby-boomer
retirement in the US and, more generally, the globalisation of
markets.
“This has been an historic year in the asset and wealth management
industry,” said Cornelia Kiley, an MD in Reynolds Associates’ Asset
and Wealth Management Practice. “The mid-year market turbulence was
not a signal to retrench, but rather to set the performance bar
even higher.”
Reynold’s recruiting trends report covers international
compensation trends within traditional asset and wealth management
companies and those focusing on alternative investments, including
hedge funds, real estate, infrastructure and private equity.
Turnover in the top executive echelons was more than 15 percent
higher than 2006, prompted by a number of industry leaders reaching
retirement age and a high level of pressure from boards that are
impatient with perceived underperformance, the survey found.
Typical compensation rose by 20 percent, driven primarily by gains
in equity and phantom equity valuations.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataThe demand for chief investment officers in all segments of the
industry is growing rapidly, pushing up compensation and widening
“move premiums”, it added.
Across the alternatives spectrum, 2007 was “the year of
convergence”, with hedge funds in real estate, real estate in
private equity and private equity in hedge funds. As these
platforms become increasingly global and diversified, the need for
professional managers will accelerate, the survey forecast.
Companies require intellectual and cultural leadership,
process-oriented decision making and the ability to manage the
risks of a business moving at top speed, it added.
Emerging markets that have been upgraded by rating agencies are now
within the risk tolerances of a greater number of investors, who
are racing for the low-hanging fruit. This is particularly true in
real estate, where there is a rush to build out operations and
capabilities in Asia and Latin America.
“Investment professionals with a track record of high performance
in these markets, who understand the real estate aspects of a deal
and can accurately underwrite the risk are exceptionally scarce,”
said Kiley.
However, the report warned that in some cases staff are probably
being promoted above their level of competence and experience. The
“hunger for talent” with cross-asset class experience and knowledge
of alternatives is leading to some earlier-than-expected
promotions, the wisdom of which will be known only with
time.