Source: Risk Talent Associates
Total compensation increased an average of 6.6% and salary increased an average of 5.2% in 2005 over previous year levels for financial compliance professionals, according to a Professional Compensation Survey released today by Risk Talent Associates, a leading risk management executive search firm.
The survey reports variability in compensation and salary according to both years of experience and title, with the most senior executives taking home significantly larger packages. Chief risk officers and managing directors receive bonuses comprised of over 58% of total compensation, as compared to 46% for chief compliance officers and as low as 21% for more junior positions. Compensation and salaries are highest at medium-sized companies, defined by 50-100 risk managers. The survey also reports higher total compensation and salaries in global locations and New York.
Michael Woodrow, President of Risk Talent Associates, states, "We expect a continued increase in demand for compliance professionals, as hedge funds begin to recruit top compliance talent and capital markets firms continue to improve their regulatory efforts. Risk management and financial compliance have converged as firms have come to understand that non-compliance is a significant risk. Only through rigorous compliance programs and focus, starting at the executive suite, can shareholder's interests be protected. The cost of compliance failure can be catastrophic, particularly to firms with global brand identities."
Over 200 financial compliance professionals participated in the survey, with the majority from investment banking, consulting, asset management, brokerage and software industry segments. Michael Woodrow adds, "Regardless of industry segment, compliance professionals need a balance of skills: a technical understanding of the financial markets, a strong knowledge of trading regulations, a previous relationship with regulators (e.g. prior work experience at a regulator) and outstanding business and communication skills."