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Professional Risk Compensation Survey Released
November 8, 2007
Betty Penzner
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Compensation growth at a healthy 9% for technology risk professionals
Growth in total compensation for risk professionals in software and technology was a healthy 9% in 2006 over 2005, slightly higher than the 7% increase between 2005 and 2004. Salary levels grew 7% in 2006 over 2005, while bonuses and non-cash bonuses increased 5% and 14% respectively. This and other findings were released recently in the third annual Professional Compensation Survey by Risk Talent Associates, a leading risk management executive search firm.
The survey shows optimism that the market for risk professionals will remain strong. The majority, or 70%, of survey participants expect that their risk group will grow in size over the next year. For groups that are expanding, 81% of survey respondents leverage internal recruiting or corporate staffing to fill roles, while 34% use job boards, 23% hire retained search firms and 23% employ contingency recruiting firms.
Michael Woodrow, founder and president of Risk Talent Associates said, “We have seen strong hiring by risk technology firms in the first half of 2007. Some large players are adding staff to create the next generation of risk management software or enterprise applications. Others are adding staff to support the keen interest in risk management by their clients in the corporate, energy, capital markets and asset management sectors. Furthermore, we have seen several instances of counteroffers by risk technology firms, as certain talent is mission critical and firms are more reluctant than ever to lose this talent elsewhere.”
Approximately 20% of survey respondents changed jobs within the previous two years, while 31% predict they will change jobs in the next two years. A solid 42% switched jobs within software and technology with the remainder from consulting, banking, corporate and other areas. Woodrow added, “Capital markets firms continue to seek exceptional risk technologists, with strong technology skills as well as financial engineering and traded products experience. It appears likely that this skill set will be in demand for the next decade, and beyond.”
The survey also reported that New York tops the list in terms of best regional compensation, followed by the West and Northeast regions of the United States. The largest risk organizations (greater than 100 risk professionals) yield higher compensation than smaller risk organizations, and professionals who focus on enterprise risk earn more than those who focus on credit risk and market risk exclusively.
This report is the third compensation survey Risk Talent Associates has released this year, after previous surveys in the capital markets and asset management. The firm expects to quickly follow these results with studies of energy, consulting, corporate risk managers and compliance.
About Risk Talent Associates
Risk Talent Associates (www.risktalent.com) is the leading international executive search firm focused exclusively on positions in the fields of market, credit and operational risk, as well as financial compliance and risk technology. Risk Talent's expertise, industry knowledge, proprietary network and dedicated focus shorten the recruiting process to deliver senior and mid-level risk managers in the capital markets, asset management, energy, consulting and software industries. Risk Talent has offices in New York, Chicago, Hong Kong and London.
Copyright © 2007 Association for Financial Professionals. All Rights Reserved.
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