The war for talent and retention has intensified. As a result, the prominence of the Head of HR at board level is on the rise. HR is increasingly taking on a larger remit, often working with leadership to establish employer brand and company culture. With the financial services industry facing the additional pressures of massive regulatory reform and disruptive technological advancements, HR directors have more responsibilities than ever before. In order to succeed at the highest levels, they must possess the following key skills.

Business and commercial awareness:

The demand for HR professionals to advise company leadership means they are becoming more aware of other aspects of the business. Boards are requiring their HR directors to provide advice on where new talent can be sourced and how current employees can be developed in a way that’s closely aligned to long and short-term commercial objectives.

As a result, HR professionals are in need of a more diverse range of experience. This has led many to come to the role from a wider set of career backgrounds. They are increasingly required to have knowledge of compliance, operations and internal communications and will often move from other areas within the business. For example, HSBC’s new global head of HR comes from internal communications, and UBS’s global head of HR was previously a COO.

New model talent management:

There has been a surge in demand for talent specialists in recent times. Organisations are investing in effective talent management programs to attract, train and retain high performing workers. HR must work closely with the business to help create and build performance metrics and environments that compete with other businesses.

Historically, financial services organisations have relied on their ability to outdo other sectors in compensation offered. Today, they face competition from deep-pocketed blue chips which offer attractive, relaxed and employee friendly campuses. Culture is now king. HR directors must therefore balance pay packages with a company culture that encourages employees to view their own goals as aligned to those of their employers.

In order to overcome the issue, HR professionals need skills that will allow them to present creative ways to develop and retain talent. Improving benefits packages is a popular method. Google is known for its vast and creative benefits package which has resulted in building a highly cohesive and collaborative culture. To compete with other sectors, financial services are having to ensure they also focus on values and culture through benefits and wellbeing. Goldman Sachs’ wellness campaign, for example, is reminiscent of Google’s and is part of its global engagement strategy.

Adaptability to financial regulation:

Since the financial crisis, businesses in all sectors have been touched by tighter regulation. This pressure is fuelled by the risk of steep fines and personal legal accountability for failures. HR directors, as a result, are being tasked with ensuring regulatory, and risk teams are fully resourced, skilled and suited to insulate the business from severe consequences. Considering the size, scale and entrenched culture of some of the larger financial institutions, this is no small task.

Improving company culture to fundamentally change employee behaviour is another HR challenge.

The FCA has imposed requirements for businesses to demonstrate ways employee behaviour is being controlled and discouraged. A push for quantifiable cultural reforms within businesses is a task that is landing on HR directors’ desks. Developing and maintaining a robust body of evidence requires not only a deep understanding of what the regulators are looking for, but also a need to keep up to date with changes and additional guidance as they come out.

Technological and analytical aptitude:

HR functions continue to react to demands for technological improvements. The internal value of a strong and well-resourced technology function can be seen through the huge amount of business and marketing intelligence that can be drawn from gathering and analysing big data. Building robust cloud computing systems and creating a modern, clear and efficient customer interface are other challenges all businesses need vast amounts of fresh skills to address. Attacks from external sources have also created a growing demand for IT security professionals, as have strong internal training and development systems to ensure new knowledge and tactics are being brought in to keep up with sophisticated attacks.

Data competency now forms a key part of HR roles. The greater focus on data in many of the big investment banks means a number of people within HR now have analytical backgrounds.  Promoting a function, and using data correctly, provides insights and foresights that impact the strategic direction of firms. Therefore, HR must continue to focus on culture and ensure that senior leadership evolves at the same rate as the business.

The global financial crisis has coincided with a period of huge technological expansion for businesses, overturning conventional models and creating major challenges for boards. The HR director has been an integral player during this period of change, as a focus on the people agenda has never been more vital. The need for HR directors to deliver value through talent, leadership and adaptability will remain for some time. It is safe to say the rise in the importance and board-level clout of the HR director is not done just yet.