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Regulatory compliance: how the UK can help Irish firms overcome skills shortages Back  
The rising tide of regulation is leading to a high demand for compliance officers. However, there is a distinct shortfall of such people, and this is reflected in the plethora of adverts for suitable people in the business press this year, writes John Kelly. As a short-term solution to finding the right compliance person, he suggests that companies consider interim managers.
Ireland’s financial services sector faces some serious challenges in the years ahead, due to a combination of continued strong growth and an increasingly sophisticated regulatory regime. Fuelled by the demands of policymakers at home and in Europe, the expansion of the latter has been even more dramatic than the growth in the sector itself (no mean feat), and poses its own, very particular tests of resourcefulness and adaptability.
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John Kelly

For the individual company, the implications of a regulatory failure are too awful to contemplate. As in medicine, financial services firms trade on their reputation for competence, probity and integrity, and a crisis of confidence very quickly reflects in the bottom line. No wonder, then, that compliance is the issue, and that the corporate response has been to recruit the necessary expertise, either by bringing in qualified outsiders or training from within.
In the face of such a high demand for compliance officers, however, there was bound to be a shortfall, and this is reflected in the plethora of adverts for suitable people in the business press this year. Efforts to close the gap have centred on the introduction of the new certificate and diploma courses under the auspices of the Institute of Bankers, but the first graduates will not emerge until early summer of 2006 and even then, there is no guarantee that supply and demand will come back into balance.

This is new territory for the Irish, but the British are well versed in the area of formal regulation. They also lead us by a fair margin in their use of interim management, precisely for the kind of exigency now confronting the industry here. This is hardly a surprise, given that the UK has a five year lead over us Ireland in terms of developing their interim management infrastructure (the concept has been slower to take off here, partly for lack of awareness, and partly because it is often misconstrued as some form of managerial ‘temping’).
In fact, of all the solutions available, this is probably the most direct, simple, and effective means of addressing high level skill shortages in financial services. Interim managers are typically mature (mid-thirties or older), highly qualified, and widely experienced. They work on the basis of fixed assignments and are appointed according to excellence of fit. The real attraction, however, is that they begin work immediately, ensuring compliance from day one and adjusting to the corporate culture and resource level of the client firm. And, because they have ‘walked the walk’, experienced ‘interims’ not only have the technical expertise, but will know how compliance impacts on the whole organisation and how this should be managed.

These managers can also act as de facto in-house trainers; delivering their knowledge and technique to those they work with. Thus, in addition to fulfilling the role assigned to them, the ‘interim’ also provides experienced-based training to whoever is their designated successor. In essence, it confers an in-house training capability on those who otherwise would not have the necessary expertise to hand.

Moreover, there are no issues with sudden arrival among the permanent staff of this temporary new executive. The interim manager is the archetypal ‘welcome stranger’: one whose presence is appreciated both for the benefits they bring, and because their stay is a temporary one that poses no threat to career advancement of anyone else, With a definite (and openly declared) date of departure, the ‘interim’ carries no professional or personal baggage: only the technical skills and experience, and the people skills and experience, to move into a position at short notice, complete the assignment, and leave.

Albemarle, the UK interim management company (and InterIM Solutions UK Partner), has long been providing specialists on assignment ‑ including compliance officers ‑ to the financial services sector there. This is especially noteworthy in the context of compliance: Britain is years ahead the Irish in terms of establishing a formal regulatory framework and by this stage can call upon a pool of experienced professionals.

Yet, even there, a healthy market in interim managers for the compliance function exists. This is partly down to the normal human resources factors, but it also reflects the nature of the compliance officer’s job: a post so sensitive and vital to the company’s health that it cannot be allowed remain vacant for any appreciable period of time; whether caused by absence (such as maternity leave or extended illness), or by difficulties in sourcing a suitable replacement for a departing executive.

One final observation: when the assignment is finished and the ‘welcome visitor’ finally moves on, the client firm is gifted a managerial imprint, or legacy, in the cultural contribution the interim manager makes during their tenure. The very fact of being an outsider gives them a perspective that those within the client company may lack, and their breadth of experience means they have witnessed different methodologies and approaches that might yield dividends in a totally new environment. In my own experience, this is the most lasting, and often the most appreciated, of interim management’s qualities.

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