CP86: Recruiting for the Key Managerial Functions
Updated: Nov 6, 2019
Under CP86 there are six core Managerial Functions that need to be in place:
- Investment Management
- Fund Risk Management
- Operational Risk Management
- Regulatory Compliance
- Capital and Financial Management.
A designated person (DP) must be appointed to each managerial function.
A DP may be appointed to more than one function however, the same person cannot perform both the investment management function and either of the risk functions.
For legacy ManCos/SMICs (those authorized before 1 November 2015), many are using an outsourced DP model (where the DP is seconded in from an external provider).
The expectation is that the current CP86 reviews by the Central Bank will challenge this model for lacking substance.
For those ManCos/SMICs that will need to increase resources and directly employ senior executives to fill the key managerial functions internally, it will be a challenging (but not impossible) market.
With the Brexit entrant wave last year, there was a lot of recruitment activity for these same skillsets. This makes the market for these candidates already tight so each ManCo/SMIC will need to develop a very shrewd and clear strategy to secure the best talent.
So, what do you need to know before going to market to recruit for any of the core functions?
1. Have a very clear understanding of the profile of candidate you need for the role and the level of experience the CBI will require.
2. Understand the existing market for these candidates (availability, salary levels etc.).
3. Understand what is motivating candidates with these skillsets to move and what is important to them in an employer.
Is your firm’s proposition to these candidates (in respect to point 3 above) enough to entice them to join?
If not, you need to look at ways that you can improve this before going to market.
You need to get the right hire, first time around.
Rush into the recruitment process and the likelihood is you’ll be back to square one in a few months.
The labour market is like any other – it’s governed by supply and demand. In a short supply market, your firm needs to be know its competitive advantages and leverage those strengths to best effect. It helps to know what the rest of the industry is doing to secure that talent away from you so you can close those gaps.
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