Guest comment: Private banks need to retain as well as recruit

Alison Malton, managing director of benchmarking specialist Compeer, says private banks need to do more to keep existing staff happy before they hire new ones.

A recent survey conducted by ComPeer in association with WealthBriefing found that job dissatisfaction is the overriding reason why wealth managers change jobs, and that a huge 30% of wealth managers are dissatisfied.

With people ready to leave, there is certainly no shortage of wealth management firms looking to hire. It is well documented that the demand for experienced client-facing staff to meet the growth strategies of the large players well exceeds current supply. However, the churning of existing talent can do little to benefit either the industry or the bankers themselves.

High-net-worth clients are liable to become dissatisfied if they're confronted by a succession of different advisors because their trusted confidants are hopping from firm to firm. It seems wealth managers themselves are aware of this - 52% of respondents in our survey said wealth managers can move firms only once every five years if they want to maintain a network of clients. A further 32% said they can only really move twice in a career.

Wealth managers that are busily hiring people in could therefore do better concentrating on the retention of existing staff. How should this be done? Three key themes emerged from the survey as critical factors in ensuring employee satisfaction:

· leadership

· financial reward

· administrative platform

Strong leadership was a key theme throughout. Staff turnover is lower in firms with a direction and conviction in a strategy that is supported by the long-term commitment of a stable senior management team. All firms should ensure that there is continual buy-in to the long-term direction by client-facing staff at all levels.

Financial reward was also clearly an important criterion. The majority of individuals said that they would be looking for a significant increase in remuneration if they were to move to a new employer. However, the focus was more on remuneration being fair and transparent; 75% of respondents said they would prefer a remuneration package that was directly linked to the individual revenue they generated, whereas only 24% are currently on this type of package.

Administrative platforms were a less significant determinant of overall job satisfaction, but they were the area in which firms fell most short of expectation. Our opinion is that platform deficiencies are likely to feed rather than create dissatisfaction: when individuals are less than happy with the direction of the business and their personal position within that, they take the frustration out in the day-to-day gripes of battling with administration or IT problems.

· A version of this article first appeared on WealthBriefing.com.