Study reveals growing skills gaps impacting financial services leadership
Senior leaders across financial services have identified three major skills gaps across their peer groups which are impacting the UK’s leadership, talent supply, productivity, and competitiveness, according to research published today by Odgers Berndtson and the Financial Services Skills Commission (FSSC).
The ‘Staying ahead in a changing world: the skills leaders in financial services need’ report outlines skills shortages across data and technology, communication, and environmental, social and governance skill sets currently facing financial services sector leadership teams. This comes against a backdrop of technological, economic, and digital disruption for firms which has been exacerbated by the pandemic over the last 18 months.
The report findings encompass in-depth interview analysis with 80 leaders (executive committee members, non-executive directors, and emerging leaders) from banks, building societies, insurers, asset, and wealth managers, fintech’s, financial market infrastructure, payments, and regulation taken from January to July 2021. The key findings include:
Data and technology skills: 80% cited data and technology skills gaps within their organisation, signalling a critical need for leaders with strong AI, cyber, and data analytics expertise.
Communication and leadership skills: 79% highlighted communication and leadership as a priority area for upskilling. Respondents referenced a new style of leadership centred on empathy and inclusivity emerging, which they believe is essential to talent retention and commercial success instead of a directional approach.
Environmental, social, and governance skills: 70% raised ESG as an upskilling priority within their organisation – and among emerging leaders, 75% voiced this was a significant area for skills development.
The report outlines three critical recommendations for boards and executive teams to take forward to enable firms to close the leadership gaps, including prioritising strategic skills planning; upskilling existing talent; and the development and implementation of inclusive talent attraction strategies.
Commenting on the report findings, Anne Murphy, Managing Partner and Head of the Financial Services Practice at Odgers Berndtson said: “In a world where financial services continue to contend with exceptional levels of disruption and change, intrinsic and extrinsic forces are driving leadership skills shortages, which if left unchecked, will have far-reaching consequences for organisational performance and competitive capability. Shoring up these gaps will require significant investment in reskilling, upskilling, attracting talent and leadership development.”
Claire Tunley, Chief Executive Financial Services Skills Commission comments:
“Today’s successful leaders require a range and depth of skills, experience and knowledge incorporating technology, data analytics, digital skills, as well as inclusion, empathy and a clear organisational social purpose. All of which are mission critical to ensure a successful and productive workforce and globally competitive industry.”
“The financial services sector is already making great strides in tackling the leadership skills gap but to accelerate progress, more firms need to upskill their existing executives as well as prioritise strategic skills planning and talent attraction strategies for emerging leaders. This is a collective responsibility for our entire industry to ensure we remain one of the most attractive, diverse, and inclusive financial centres in the world.”
In addition to identifying the skills gaps, the report also details how financial services leaders believe, increasing efforts to recruit new skills from outside the industry as well as the development of in-house universities within firms, intensive tech education programmes and data academies are possible solutions to address the digital skills gap. Hiring based on breadth of experience and potential at senior levels rather than individuals having a deep specialism was considered the preferred skillset to creating more purpose-based leadership.
The full Report can be downloaded here.