This article was first published in the October China edition of Accounting and Business magazine.
I’ve been hearing about the very tight market for finance talent in China for more than a decade now. But with the current restructuring of the economy and the economic slowdown there, I had assumed that multinational corporations and local companies are having an easier time recruiting and retaining CFOs, finance controllers, treasurers and other finance professionals.
No such luck, apparently. ‘It’s still a very tight market and pretty competitive,’ Shanghai-based Simon Lance recently told me. He should know – Lance is regional director, China, for Hays, a leading global specialist recruitment group. Some parts of the labour market may be easing, he conceded, but not the technical and senior levels in finance.
You would think that a nation of 1.3 billion people would have more than enough finance professionals to go around. But remember, China has undergone political upheavals that have held back its soft infrastructure. Things are stabilising. Last year, China’s universities produced 6.8 million graduates – that’s nearly the entire population of Hong Kong.
But, of course, they are all too green. What enterprises desire is a combination of technical, soft, cultural and people management skills, as well as language and alignment with the company’s values. ‘A lot of [mainland] Chinese candidates haven’t yet come to the level in foreign companies,’ said Lance. ‘There’s still a bit of a transition happening in bridging the two worlds of Western management and Chinese local culture.’
He thinks it’s only a matter of time, though. ‘There’s a really good wave of finance professionals in junior to mid-level ranks,’ said Lance. ‘I think over the next five to ten years, they will develop into the senior roles’ – and presumably ease the current crunch.
It was interesting for me to learn that enterprises in China have apparently now decided that local is totally best. Not too long ago, you’d find Western expats, and eventually Hong Kong and Singapore finance professionals, at the top in finance, in part because headquarters did not fully trust local managers.
That’s changed. ‘By and large we have more interest from our clients in identifying Chinese nationals,’ Lance told me. ‘Where that is not possible, we expand our search to Hong Kong and Singapore, and even expats [in the West], but there is a strong preference to find Chinese local candidates.’
For expats, ‘it should be a long-term commitment’, he added. ‘They must realise that employers in China are no longer looking for a one- or two-year secondment for an individual. They are looking for people that see their careers in China.’ Candidates from Hong Kong and Singapore have a ‘fantastic advantage’ in possessing language and cultural attributes close to China’s. ‘But they still need to be committing to the longer term.’
Other things have not changed. I’ve always thought that the long-term solution in China is for firms to undertake a serious professional development programme for their staff, and avoid poaching other firms’ talent. That’s not happening.
‘China is a fairly impatient recruitment market, so domestic firm or multinational, the preference and the need is to find someone that already has the [required] skill set,’ said Lance. ‘People are looking for the perfect short-term solution.’
Happily, finance professionals themselves are showing restraint. In the five years to 2011, Hays found that many candidates had moved two or three times very quickly, and were looking to do so again. ‘Not any more,’ said Lance. ‘I think candidates are aware that they need to establish themselves and demonstrate a longer-term commitment, particularly at the senior level, if they’re going to progress.’
In China, as elsewhere, candidates need to demonstrate that they have managed finance ably throughout the whole business cycle – good times, bad times and in-between.
Cesar Bacani is editor-in-chief of CFO Innovation Asia