Top HR talent exits banking

According to HR recruiter, Justine Aspey at Adway Associates, investment banking has long been judged to be behind other sectors in recognising the value of the HR function. Undervalued and under-utilised, top HR talent is leaving for pastures greener, lured in particular by dot-coms and self employment.

John Thain, co-chief operating officer at Goldman Sachs says: 'We have spent a large amount of time on people development. It has become our most important issue.'

However, despite apparent enthusiasm at the top, it is rare that HR staff are given strategic clout equal to that of other directors.

Louise Barrett, former head of human resources at Commerzbank and Société Générale, is one of a number of disillusioned HR stars to have left. 'Too often the HR function is kept remote from the business and only brought in when there is a crisis. I found I was not given the opportunity to make a difference until it was too late. It was very frustrating,' she says.

Barrett left banking to start the Success Group, an executive coaching company. But others are finding their feet in the new economy. Tim Macready, chief executive of Skill Capital, a recruiter focusing on the technology sector, says that HR people from investment banks are sought after for posts in dot-coms and web consultancies.

'They have good experience of developing team skills and managing payment expectations. A lot of new companies are growing fast and need people who can manage cultural change among staff with high financial aspirations,' he says.

Those professionals who have been involved at a strategic level find their appeal is further magnified. Susan Ferrier, former managing director and global head of human resources at ING Barings, recently took the position of chief executive in a start-up aimed at theatre goers, Greenroom-arts.com.

The company is not slow to praise her abilities. 'Susan brings with her considerable strategic and leadership skills,' says the company's chairman, 'We have a corporate star on our hands.'

But it is to ambitious HR staff at the vice-presidential level that exiting the financial services arena presents the greatest allure. According to Stephanie Staton at specialist financial services HR recruitment firm Richmond and Co, consolidation in the banking sector means that there are fewer top HR jobs available than in the past. Those waiting for top posts are having to wait longer, she says.

At Armstrong International, HR consultant Sally Talbot says that HR staff in their late 20s are impatient: 'Lots of candidates ask me to let them know if a good opportunity in a dot-com comes up.'

One former vice-president to have left banking for the new economy is Mark Ellis, a former vice president at Merrill Lynch. After working with Merrill Lynch for five years, Ellis departed to become head of HR at new media company Presco.

'Moving to a company that is hoping to float at some point in the future is very exciting.

But even more exciting is the challenge of working in a new and very fast growing organisation,' he says.

The financial sector is in danger of losing more human resources vice presidents in the future. Those who stay behind may be less dynamic.

Some specialist functions are already suffering from poor-quality candidates. One HR recruiter attributes the current shortage of compensation and benefits experts to a glut of plodding types. 'What I need are people with law and business experience. What I'm getting are under-qualified candidates who have worked the hierarchy,' she says.

As the home-grown talent leaves, banks are increasingly trawling for people from outside financial services.

HR generalists from Marks & Spencer have long been coveted for junior positions, but now senior staff from the non-financial sector are also desired.

Paul Wilson at Michael Page Human Resources says that generalists from outside the City are being hoovered up.

HR heavyweights such as Commerzbank's Steven Sidebottom and Mercury Asset Management's Lawrence Morgan are among those to have begun their careers outside banking and leap-frogged into top positions. An important part of their new role will be retaining the next generation of HR staff.

sbutcher@efinancialnews.com