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Global trend reports core finance h1 2014



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  • 2. A MODEST IMPROVEMENT IN THE GLOBAL MARKET • Organisational change, compliance and regulatory issues and IT changes have been the main drivers of recruitment • Experience in ERP is a highly prized asset • Candidates need to keep on top of changes to reporting requirements (in particular IFRS) • In Commerce & Industry there is a trend towards hybrid roles combining core financial and commercial functions • In Hong Kong and Singapore, recruitment budgets remain tight • The market is becoming more buoyant in Ireland • More roles are being posted in the UK in a cost- conscious post-recession environment • There is a shortage of top-quality candidates in Japan but language is a barrier to entry for non- nationals • Salary growth will be at best moderate and may even decline in some cases In line with our commitment to keep professionals working in Core Finance functions up to date with employment and recruitment trends, at the start of 2014 Morgan McKinley conducted an international survey of its consultants in five markets. The market has picked up in most regions and we expect further improvement in 2014. Nevertheless growth in salaries will be moderate. In this climate candidates must seek out employers that offer a good cultural fit and offer opportunities for career progression, for example through internal rotation. 1 QUICK LINKS HONK KONG..........................................2 IRELAND...................................................4 JAPAN........................................................5 SINGAPORE.............................................6 UNITED KINGDOM................................8
  • 3. The recruitment market for Core Finance roles picked up a little in the second half of 2013, though the focus was on replacement headcount against a background of continuing economic uncertainty and static or declining recruitment budgets. Organisational change (such as review and restructuring of the operating model and introduction of new products) and globalisation of functions were among the main drivers of demand for Strategic Finance, Financial Accounting and Reporting, and Systems and Project Finance specialists. “Organisations still feel obliged to contain costs and many have recruitment freezes in place, while others are sourcing candidates directly from LinkedIn,” says one of our Hong Kong-based recruitment consultants. Experience in ERP systems has proved a valuable asset when combined with a professional accounting qualification and an MBA. Increasingly, listed companies are also interested in candidates who have the company secretary professional qualification, HKICS. The contract market has remained stable. 2 Candidates should look for companies that are a good cultural fit. MARKET IMPROVING DESPITE TIGHT RECRUITMENT BUDGETS HONG KONG
  • 4. 3 OUTLOOK SALARIES & BENEFITSOur outlook for 2014 is generally optimistic. However, candidates will need to be realistic about salaries and focus on opportunities that will broaden their horizons and advance their careers in the long term. “Candidates should look for companies that are a good cultural fit,” says one of our Hong Kong-based Core Finance consultants.This is as likely to be with an SME as with a large enterprise. We see a shift of emphasis from reporting to business partnering and financial planning roles. The projected increment for salary increases in 2014 is 5%. Many organisations will reward individual performance with bonuses, but increasingly multinational companies are including global performance as a factor, which means that even if the Asia Pacific region hits its target bonuses will also take into account losses or shortfalls elsewhere.
  • 5. Economic confidence returned to Ireland in 2013 and with it an improvement in the recruitment market for Core Finance, with organisations recruiting new and replacement headcount as they implement IT changes and reorganise. Recruitment budgets are increasing, but hiring processes can be lengthy as organisations seek the perfect match.The main growth areas to date have been Transactional (AP/AR/RTR/OTC), Senior Finance (Commercial/Financial Planning & Accounting) and Financial Accounting & Reporting roles. “We have been most surprised at the pace of growth in the number of roles that combine core financial and commercial functions,” comments one of our Dublin-based consultants. Fluency in a foreign language is an increasingly valued asset alongside a professional accounting qualification and experience with ERP systems.The contract market is fairly buoyant. 4 Hiring organisations must speed up their hiring processes. ERP EXPERIENCE A HIGHLY PRIZED ASSET IRELAND OUTLOOK Our outlook for 2014 is optimistic and we expect to see more candidates coming forward.Those who want to progress should build up their ERP experience. “Hiring organisations will need to speed up their hiring processes if they want to gain an edge in this competitive market,” comments our consultant. SALARIES & BENEFITS We expect to see a moderate increase in basic salaries but no changes to performance-related pay and benefits.
  • 6. We saw no discernible change in the recruitment market for Core Finance roles in Japan in the second half of 2013, despite signs of an economic upswing. Organisational and IT change were the main drivers but the focus was on replacement headcount. Strategic Finance (Commercial and Financial Planning and Accountancy), Financial Accounting and Reporting and Systems and Project Finance roles were most sought after. One of the problems for hiring organisations was the lack of local talent, a problem in Japan as fluency in the language is a sine qua non for any Core Finance position, and fluency in a foreign language (typically English) is very often a requirement, too. Hiring organisations also value practical experience, including experience of ERP systems such as SAP and Oracle, alongside a professional accounting qualification. 5 Candidates with practical experience and foreign language fluency are in demand. SHORTAGE OF SUITABLY QUALIFIED CANDIDATES OUTLOOK There is currently an over-supply of candidates in general in Japan but an under-supply of suitably qualified candidates.There is an excellent opportunity for overseas candidates with the right set of qualifications, project experience, and fluency in Japanese, but these are very rare. “Hiring organisations will blow out any candidate who is a 70% match or less, so there is little point in us putting them forward,” says one of our Tokyo-based consultants. “In such cases it is more constructive for us to act as a good career partner, give an honest assessment, and provide what help we can to move people forward.” We also expect a greater trend towards business partnering. Candidates must demonstrate that they can also add value beyond the strict boundaries of Core Finance. JAPAN SALARIES & BENEFITS In the current climate Core Finance professionals have grown rather distrustful of bonuses and focus more on basic salaries. However, these will remain stable or may trend slightly downwards in 2014.
  • 7. In general we feel that the Singapore market improved in Core Finance in the last year compared with the previous two years. However, hiring processes still remain lengthy and there is a big emphasis on the quality of the candidates and financial professionals’ resilience in an ever- changing environment. Also, we have seen a trend in employers reaching out for external hires but eventually hiring individuals internally who have been mobilised from other teams, and this has been frustrating for job seekers. Organisational change, compliance and regulatory issues and IT changes have been the main drivers of recruitment. However, recruitment budgets remain quite tight and some organisations have cost-cutting measures in place, including pay freezes and consolidation, outsourcing or offshoring of functions. We have seen hires made in roles such as Financial Accounting and Reporting, Systems and Project Finance and Strategic Finance and these will continue to be the main areas of growth in 2014. 6 Maintaining one’s level of education regarding changes in regulations and compliance issues is imperative. PROOF OF RESILIENCE AND A STABLE CAREER RECORD ARE KEY SINGAPORE
  • 8. 7 OUTLOOK In 2014 Singapore will remain a highly competitive market, where hiring organisations are very particular, and this will lead to long hiring processes in many cases. In the current economic environment employers are looking for candidates who can demonstrate a stable career record and resilience to the ever-changing financial landscape. Maintaining one’s level of education regarding changes in regulations and compliance issues is imperative, and keeping up to speed with changes in reporting standards is particularly important. Within Commerce & Industry non-local finance professionals should perhaps take a more flexible approach to their job searches if they are genuinely keen to work in Singapore.This means being open to interim, contract and temporary positions in the first instance in order to secure an opening. In this environment it is vital that candidates should prepare very thoroughly for interviews. Core Finance roles are also becoming increasingly hybrid in the Commerce & Industry sector, extending to functions such as supply chain, taxation and treasury. However, there is a continuing reluctance among many candidates to embrace this broader scope, which is limiting the talent pool. Employers will find it difficult to find quality candidates and, at the same time, will be challenged to retain staff in an environment where quality finance professionals with a solid track record are much sought after. SALARIES & BENEFITS Core Finance professionals making a lateral move in Commerce & Industry and Financial Services are unlikely to secure a significant increase in pay. In specialised finance roles such as audit and tax we expect increases in the order of 5 to 10%. We have seen no changes in bonus and benefits structures compared to previous years.
  • 9. Against the backdrop of returning economic confidence, the recruitment market for Core Finance professionals picked up somewhat towards the end of 2013. Hiring budgets have increased in some organisations (though the picture is rather mixed) and demand was strongest for Strategic Finance, Financial Accounting and Reporting and Systems and Project Finance roles. Compliance and regulatory issues are driving demand as well as organisational changes and IT initiatives.There has been inadequate local supply to meet this demand so we have seen applications from abroad, with the number of job seekers from Australia and New Zealand heading back upwards. Some companies launched internal mobility schemes about 18 months ago to redeploy finance staff and this can work very well, but such initiatives can exhaust themselves quite quickly and we are now seeing more external recruitment from those same firms. Candidates with a professional accounting qualification and experience in ERP systems such as SAP and Oracle are in demand (or Sage at SMEs). “We have seen more jobs posted in the latter part of 2013 and moving into 2014 with an increasing number of candidates gaining multiple offers before accepting one,” says one of our London-based consultants. 8 It is in employers’ best interests to provide constructive feedback. ROLE OF FINANCE IS CENTRAL TO BUSINESS DECISION-MAKING UNITED KINGDOM
  • 10. 9 OUTLOOK We are confident that the upturn in demand will continue in 2014 and that candidates will be more proactive in seeking new roles. Although economic confidence is returning, these are still cost- conscious times and finance plays a leading role in business decision making. Competition will be strong, and we counsel people to brush up on their interview techniques. “Too many candidates go to a first interview poorly prepared and this can be fatal to your chances. We encourage them to seek advice and do a mock interview, especially if they are coming back onto the market after some time in the same job,” says one of our London-based consultants. Candidates will also need to be flexible about what they want to get out of a position, and not focus exclusively on pay, as this will send the signal that they are not committed for the right reasons. “Think carefully about your end goal and work back to understand how you achieve this. Businesses that offer greater rotation potential in finance after qualification can advance employees more quickly,” says another of our UK consultants. However, by the same token, hiring organisations that want to secure the brightest and best minds available have a duty to themselves to act quickly and provide effective feedback. “When the market picks up it is in our clients’ best interests to provide constructive feedback on the candidates they see. This will give them a positive reputation in the marketplace, which will also ensure that they see the best talent when it is in short supply,” says a London-based consultant. Candidates should also take note of the fact that IFRS is going through a huge change, being consolidated down from 2000 pages to 200. “Accounting professionals who demonstrate awareness of such changes always stand out,” adds the consultant. IFRS will become even more important as smaller businesses will no longer be able to report under UK GAAP. SALARIES & BENEFITS We see a potential for a slight improvement in salaries and benefits in 2014, but no more.