Chief compliance officers are still in high demand, but the skills that companies are looking for in top candidates are changing.
As business regulation has grown increasingly complex across the globe, the demand for compliance professionals is at an all-time high. At the same time, though, the compliance profession is changing rapidly, as are the skills that companies want in compliance leaders today.
A new compliance study conducted by executive search firm Heidrick & Struggles finds that many companies don’t believe their internal talent pool meets their current compliance needs, and that’s driving many to compete for outside talent. They are looking for professionals that have strong leadership and communication skills, and are also forward-thinkers that have the ability to strategize about risks that may come down the pike.
Compliance executives have traditionally possessed good technical skills—such as policy creation and having a keen understanding of the latest laws and regulations, but compliance professionals today need both technical skills and leadership skills. “Employers are looking for a person who is a great leader, someone with great persuasion skills,” says Maurice Gilbert, founder of corporate compliance search firm Conselium.
Companies are seeking compliance leaders who have the ability to influence others, communicate effectively, and build relationships with a wide range of internal and external stakeholders, including regulators. “So you want that person to be polished, well-spoken,” says Jason Wachtel, managing partner of executive search firm JW Michaels.
The ideal compliance candidate must play dual roles that sometimes conflict. Compliance officers must have the ability to build close partnerships with the business, but also maintain a certain level of independence to serve in an oversight role, Paul Gibson, a partner at executive search firm Heidrick & Struggles, says. “That’s a very difficult balancing act,” he says.
Another complex aspect of the job is being able to navigate through the gray areas. “You need to know how to sort out what’s a problem and what’s noise,” says Kathleen Edmond, former chief ethics officer of Best Buy and now of counsel for law firm Robins, Kaplan, Miller & Ciresi.
Because the compliance field is continuously developing, along with the skills that the job demands, a talent shortage remains. According to a compliance study conducted by Heidrick & Struggles, 47 percent of respondent companies said their internal talent pool doesn’t meet their current compliance needs.
The study also revealed that compliance professionals come from various backgrounds. “The people who have joined the firm externally tend to have existing compliance experience or regulatory experience,” Gibson says.
“If you ask what a perfect profile of a compliance officer is, it’s someone who has a J.D. who has worked at the SEC. That’s what all my clients want. If you have a regulatory background, it’s a golden ticket.”
Jason Wachtel, Managing Partner, JW Michaels
Other executive search firms are similarly observing a noticeable rise in the number of companies hiring former regulators. JW Michaels, for example, has someone on staff whose only focus is corporate clients looking to hire former regulators. “That practice area has grown significantly for us,” Wachtel says.
“If you ask what a perfect profile of a compliance officer is, it’s someone who has a J.D. who has worked at the Securities and Exchange Commission. That’s what all my clients want,” Wachtel adds. “If you have a regulatory background, it’s a golden ticket. You’re always going to have a job, and you’re always going to be in demand.”
Among companies that do hire from within, compliance officers hail from various functions. “There is no one definitive route into a compliance role,” Gibson says.
According to the Heidrick & Struggles report, the largest number of compliance professionals hailed from legal (25 percent) and compliance (18 percent). Others came from operations (16 percent); risk (14 percent); and audit (12 percent).
The traditional route of compliance professionals coming from various professional and educational backgrounds is in the midst of significant change, as some innovative business schools and law schools are just now starting to offer subjects and courses specifically focused on ethics and compliance.
“There is an immediate demand for talent that understands legal theory, laws, regulations, and rules applicable to financial services, pharmaceuticals, and other industries,” Yvette Hollingsworth, chief compliance officer of Wells Fargo, says.
In response to this demand, the University of St. Thomas School of Law this fall began offering master’s and LL.M. (Master of Law) degrees in organizational ethics & compliance for non-law students, and dual degrees and concentration options in this field for J.D. students.
“As different as compliance work can be, and as diverse as the jobs of compliance are, there is a core set of knowledge and skills that every compliance leader and professional should know,” Robert Vischer, dean of the School of Law, says. “So part of the program is designed to grow with the profession’s understanding of itself as a profession, which is still a relatively new field.”
Below is a list of compliance professionals who serve on the advisory board for the Organizational Ethics & Compliance programs at the University of St. Thomas School of Law.
The role of the board is to help shape the program on an ongoing basis to ensure it remains relevant and on the cutting-edge of changes in the compliance profession. Members of the advisory board include:
Deb Berns, chief compliance and ethics officer, UnitedHealth Group;
Michael Brennan, vice president of compliance, Allianz Life;
Carolyn Brue, assistant general counsel and corporate compliance manager, Cargill;
Chris Collin, ethics & compliance senior manager, General Mills;
Dan Dorsky, chief compliance officer, Pentair;
Kathleen Edmond, of counsel, Robins, Kaplan, Miller & Ciresi;
Piran Farhadieh, senior counsel, St. Jude Medical;
Joe Fleming, director of compliance, RBC Wealth Management;
Rob Foehl, vice president & general counsel, ACA International;
Nancy Held, director of corporate compliance, Xcel Energy;
Yvette Hollingsworth, chief compliance officer, Wells Fargo;
Peggy Kubicz Hall, partner, Greene Espel;
Tim Marrinan, senior advisor, Treliant Risk Advisors;
Scott Read, principal, Deloitte Forensic;
Dan Roach, vice president for compliance & audit, Dignity Health;
Tom Schumacher, chief compliance officer, Medtronic;
Tobi Tanzer, vice president for integrity & compliance, chief compliance officer and privacy officer, HealthPartners
Mike Wietecki, partner, general counsel & chief operations officer, Common Sense Investment Management;
James Zappa, vice president, associate general counsel and chief compliance officer, 3M;
Pam Ziermann, chief compliance officer, Dougherty Financial Group; and
Roy Snell, CEO, Society of Corporate Compliance and Ethics.
Source: St. Thomas School of Law.
St. Thomas developed the program with compliance executives across a broad range of industries, including Wells Fargo, General Mills, Medtronic, 3M, UnitedHealth Group, Allianz Life, and many more. The inaugural class has 13 non-law students, and about another 30 J.D. students in the compliance programming course, Vischer explains.
For students without a law degree, the program consists of four core courses:
Introduction to Legal Reasoning: This course is designed to help non-law students develop critical-thinking skills. “Careful reading and analysis of case law and statutes will prepare students to address the ambiguity of many scenarios that arise in compliance work,” according to the course description.
Compliance Programming: Design, Operation, and Performance: This is a “nuts and bolts” compliance course that explores all the various elements of a corporate compliance program, Vischer says.
Examples of themes explored include:
Risk identification and assessment;
Communication and training;
Investigations and discipline;
Reporting and disclosure;
Auditing and monitoring; and
The course also explores how to measure effectiveness from the perspectives of both ethics and economics.
Ethical Culture: Through this course, students learn about the elements of ethical decision making and ethical cultures from the perspective of an organization’s leadership. “Students will learn to recognize and resolve ethical issues and identify practical ways to enhance sound ethical cultures and to remediate weak ethical cultures,” according to the course description.
Executive Perspectives on Ethics and Compliance: This course provides students with an opportunity to learn about compliance from the perspective of practicing compliance executives in the industry.
“Compliance education has to grow along with the compliance field itself,” Vischer says. “We all know compliance is booming and it’s becoming more central to how businesses organize themselves and operate, but what needs to develop—and will develop—is an even stronger sense that compliance is not just about a set of technical skills.”
Rather, it’s equally about establishing a “professional identity,” Vischer says. It’s about understanding and embracing at its core what it means to be a compliance officer today.