The economic downturn and credit crunch combined with the numerous recent changes in regulatory legislation, have caused businesses around the world to change their operational procedures. More than ever, they are seeking to protect themselves against risk and consequently are turning to risk management specialists to protect their interests. As a result, there has been a surge in demand for compliance and risk management experts, even while recruitment levels of other professionals in the banking and finance sectors have remained more or less unchanged.
This position was highlighted in a 2012 report from leading finance and professional recruiters Randstad Finance and Professional that showed that there is high demand for well-qualified risk management experts in the banking and finance industries. This is despite that fact that there have been very few redundancies in the area, especially when compared with the huge number of layoffs in banking and finance in recent years.
The Randstad report shows that businesses are becoming increasingly aware of the need to mitigate against risk and the dangers of high level exposure to high risk assets. It also illustrates that businesses are still taking steps to meet the demands of the new changes in regulations.
In the United States leading figures have commented on the effects of regulation in similar fashion to Randstad. The Wall Street Journal has pointed to financial risk management as a likely growth area, while Dawn Fay, New York City area President of prestigious American human resources consultancy Robert Half International, has said that she expects to see thousands of new jobs in the compliance sector, many of which will be in risk management. Minnesota Congressman Keith Ellison concurs with these views noting that, although the new regulatory environment will have a negative impact on finance job levels, there should be opportunities in the field of compliance.
What holds true for the United States finance industry can be expected to be mirrored in Europe and the Randstad report clearly suggests that this is the case. So what is a financial risk management professional expected to do?
One of the primary tasks of the risk expert is to apply various investment strategies to ensure the highest possible return for his employer. This requires a deep understanding of market risk and the economic forces and other factors that affect market performance. It may involve the making of new investments or else managing existing investments to maximise returns or minimise losses.
Clearly, for suitably qualified professionals there should be a good number of exciting employment opportunities in compliance and risk management in the banking and finance sectors on both sides of the Atlantic. While the credit crunch has led to many redundancies and layoffs as well as reduced recruitment in many fields of finance, compliance and risk management seems to be one area where there is some cause for optimism.