Financial Research on International Financial Services Industry

Description
Financial Research on International Financial Services Industry

Future Skills and Research Needs
of the International Financial
Services Industry
Expert Group on Future Skills Needs
December 2007
Future Skills and Research Needs
of the International Financial
Services Industry

A study for the
Expert Group on Future Skills Needs
December 2007
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Table of Contents
Taoiseach’s Foreword 6
Chairperson’s Foreword 8
Executive Summary 10
Chapter 1: Introduction 25
1.0 Introduction 25
1.1 Background to the Expert Group Study 25
1.2 Terms of Reference 26
1.3 Approach and Methodology 26
1.4 Report Structure 28
Chapter 2: International Financial Services Sector 29
2.0 Introduction 29
2.1 International Financial Services Landscape 29
2.2 International Financial Service Sector in Ireland 37
2.3 Ireland – Banking and Capital Markets Sector 40
2.4 Ireland – Investment Management Sector 41
2.5 Ireland – Insurance Sector 42
2.6 Summary 43
Chapter 3: Review of Irish Financial Services Skills and Research Demands 44
3.0 Introduction 44
3.1 Investing in Ireland 45
3.2 Industry Trends 47
3.3 Skills Demand – Industry View 50
3.4 Skills Pro?les by Sectors 53
(i) Banking and Capital Markets 53
(ii) Investment Management 63
(iii) Insurance 70
3.5 Expected Future Skills Needs 77
3.6 Supply Side Dynamics 90
3.7 Summary 94
Chapter 4: Review of Irish Financial Services Skills and Research Providers 96
4.0 Introduction 96
4.1 Course Provision 106
4.2 Course Development and Update 120
4.3 Research Activity 129
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4.4 Industry Linkages/Collaboration 140
4.5 Summary of Irish Financial Services Skills and Research Providers 148
Chapter 5: Comparison of Irish and International Financial Services Skills and Research Providers 150
5.0 Introduction 150
5.1 International Course Provision 153
5.2 International Course Development and Update 160
5.3 International Research Activity 167
5.4 International Industry Linkages/Collaboration 177
5.5 Summary of International Financial Services Skills and Research Providers 183
5.6 Irish and International Skills and Research Providers – Gap Analysis 184
Chapter 6: Research, Development and Innovation 188
6.0 Introduction 188
6.1 Background to R&D in Financial Services 188
6.2 Barriers to RD&I 191
6.3 Support Structures 191
6.4 Summary 192
Chapter 7: A Centre 193
7.0 Origin of the Centre 193
7.1 Expert Group on Future Skills Needs Consultation Process 193
7.2 Potential Models for the Centre 196
7.3 Next Steps 198
Chapter 8: Recommendations 199
8.0 Introduction 199
8.1 Summary of Recommendations 200
8.2 Detailed Recommendations 201
Appendix A: Glossary of Terms 218
Appendix B: Steering Group Members 219
Appendix C: EGFSN Members 220
Appendix D: Research and Secretariat Support 221
Appendix E: List of EGFSN Publications 222
Appendix F: List of Submissions Received 224
Appendix G: List of Consultations with Industry 225
Appendix H: List of Consultations with Providers 226
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Acknowledgements
This report is based on contributions from both individuals and organisations, the principal of who are
outlined here and others are identi?ed throughout the text. The study was overseen by a Steering Group,
the membership of which is set out in Appendix Two.
Contributions
The report is substantially based on research carried out by PricewaterhouseCoopers for the Expert Group
on Future Skills Needs, Forfás, and IDA Ireland.
The Skills and Labour Market Research Unit of FÁS conducted the quantitative research for the report.
Forfás managed the development of this study.
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Taoiseach’s Foreword
Since the foundation of the International Financial Services Centre in Dublin
in 1987, the international ?nancial services industry has prospered, and
Ireland has become a signi?cant player on the international stage.
The impressive growth of the IFS Industry in Ireland over recent years is
re?ected in any number of indicators. Since 2001, for instance, Irish banking
assets have tripled in value from €422 billion in 2001 to €1.2 trillion in 2006.
In the same period, the value of investment funds domiciled in Ireland has
increased threefold, while the value of investment funds administered in
Ireland has increased by an even greater amount. This Irish Stock Exchange
has become the largest exchange for funds listings with over 4,300 listed.
In addition to the industry’s direct contribution to the Exchequer, amounting
to €1,118 million in corporation tax in 2006, its positive impact on the labour market is also particularly
noticeable. According to recent ?gures, over 22,000 individuals are employed in IFS in Ireland. More than
this, however, the industry has led to the creation of a large number of high-value, high skilled
opportunities for Irish workers and graduates – exactly the type of employment opportunities we are
seeking to create as we move towards the development of a knowledge economy.
The good news is that Ireland remains an attractive investment location for multinational ?rms. Indeed,
employment growth of 16.1 percent in 2006 is testament to the resilience and competitiveness of IFS in
Ireland, and is an encouraging sign for the future.
Companies are drawn to invest here by a combination of factors, notably our favourable regulatory and
taxation environment, the experience which is embedded in the workforce after 20 years of success, our
English language ability and our strategic location to form a bridging point between east and west to
support 24-hour markets. Not least of Ireland’s advantages is our supply of high calibre workers – repeated
studies have emphasised the esteem in which the well-educated Irish labour force is held by multinational
corporations. The quality of the Irish workforce offers any ?rm locating in Ireland a distinct competitive
advantage, and one which is recognised by the number of major international ?nancial companies
currently operating out of Ireland.
The challenge now is to ensure that the environment in which international ?nancial services companies
operate in Ireland remains attractive and that we leverage all possible international competitive advantage.
We must also stimulate the development of indigenous companies in this area, whether they are providing
support and service functions to existing MNCs or are engaged in innovation and research activities
intended to initiate the next wave of product and market developments.
An adequate supply of skilled workers is required to meet the needs of enterprise. Addressing the skills
needs of the sector is a signi?cant challenge, and is one which I believe is of paramount importance to the
continued success of IFS in Ireland. We must address both the quantity of skills available to companies and
the quality of skills.
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With this in mind, and following on from Building on Success, which was published in 2006, the
Expert Group on Future Skills Needs was asked by the Clearing House Group to examine the skills needs of
the entire international ?nancial services industry and to put in place a strategy to ensure a continued and
sustainable supply of skills to meet the needs of employers. This study is the result of extensive research
and consultation and clearly identi?es the actions required to support the continued development
of the industry.
I believe that, having identi?ed the skills issues of most concern, the time is right for Government
Departments, State Agencies and the industry, to work together to deliver upon the recommendations set
out by the EGFSN. In doing so, we can put in place a skills framework that will facilitate the continued
development of the industry, thus, enhancing our international competitiveness.
I would like, on my behalf and on behalf of my colleagues in Government to thank the members of the
EGFSN for their important work, and Forfás and IDA Ireland for their support with this study.
An Taoiseach
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Chairperson’s Foreword
On behalf of the Expert Group on Future Skills Needs, I am pleased to
introduce this report entitled Future Skills and Research Needs of the
International Financial Services Industry, based on research undertaken at
the request of the Clearing House Group.
The report re-emphasises the importance of the International Financial
Services industry to Ireland. It is reassuring that the consultations con?rmed
Ireland’s continued attractiveness as a location of investment. The report,
however, also highlights a number of skills issues which need to be
addressed in order to ensure the continued competitiveness of the industry
in Ireland.
As a result of the EGFSN research, four main issues have been identi?ed as priorities – the shortage of
particular skill sets, particularly in relation to certain high skilled occupations; problems relating to staff
retention in many sub-sectors engaged in routine yet crucial back-of?ce functions; the development of a
research agenda in international ?nancial services; and the manner in which education and training
programmes are developed, coordinated and implemented between providers and industry.
Like most developed economies, certain highly desired skills sets are in short supply in Ireland. This is
partly a result of our extraordinary economic growth over the last decade which has produced a tight
labour market with low unemployment. The analysis in this report ?nds signi?cant needs for graduates
with good quantitative and mathematic skills, as well as demand for individuals with knowledge of
compliance, risk management and actuarial skills. Looking to the future, our forecasts suggest that these
are likely to persist, and indeed, it seems probable that we will also experience increasing demand for staff
with expertise in derivative structuring, credit analysis, languages, and pan-European legal and taxation
experts. We must, therefore, plan accordingly.
In response to these issues, the EGFSN has proposed a set of recommendations designed to improve the
?ow of skills for international ?nancial services. These recommendations require responses from the
universities, the Institutes of Technology, the professional institutions, training providers, and industry itself,
and involve the development of new courses and modules, as well as ?exible delivery systems, and
improved coordination between industry and education and training providers.
The report also draws attention to the issue of staff retention in international ?nancial services – many sub-
sectors have experienced signi?cant turnover rates in recent years and this is adding to costs and, all the
while, damaging ef?ciency. The EGFSN has proposed a solution involving the development of more
innovative HR strategies and the provision of improved career guidance to potential employees.
In terms of the research agenda in international ?nancial services, it is clear that there is currently a
communication de?cit between academics engaged in ?nancial-based research and companies operating
in the marketplace. A common understanding and language is required and a shared recognition of the
value and role of research in international ?nancial services must be developed in order for a mutually
bene?cial relationship to be cultivated between enterprise and academia. Indeed, this is an area in which
Ireland can develop a competitive advantage.
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Finally, in order for all other recommendations to succeed, there is a need for improved cooperation and
coordination between all of the interested parties in the sector. Industry needs to clearly communicate its’
needs to skills providers and to take a greater role in course design and delivery, while the providers need to
ensure that their offerings re?ect industry demand and are responsive to the rapidly changing marketplace.
Certainly, the challenges outlined above are pressing and need to be addressed quickly in order to protect
the continued development of international ?nancial services in Ireland. This report should be viewed as
providing an opportunity for the sector. This report places Ireland at the forefront of a global quest to
develop and source talent in ?nancial services. By taking af?rmative action now to address the challenges
raised by the Expert Group, Ireland can enhance its reputation as a centre for high-value International
?nancial services functions allowing both industry and providers alike to reap the bene?ts of growth.
I would like to thank all those who have contributed to the production of this report. In particular I would
like to thank all those who made submissions to the process and who participated in workshops, meetings
and consultations, all of which were invaluable in producing this report. I would especially like to express
my gratitude to the members of both the Expert Group and the Steering Group who generously
contributed both their time and expertise. Finally, I would like to thank the team in Forfás and FÁS that
provide the secretariat and research support to the Expert Group on Future Skills Needs.
Anne Heraty
Chairperson, Expert Group on Future Skills Needs
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Executive Summary
Introduction
Since the early nineties, Ireland has established a reputation as a leading international ?nancial services
centre. A number of factors have been instrumental in this success. These include: an attractive ?scal and
regulatory environment, the availability of a highly skilled educated workforce, a relatively favourable cost
structure, as well as political and economic stability.
In 2006, the Clearing House Group (CHG) published the Building on Success report which adopted a
vision that Ireland will be ‘a major player in international ?nancial services focused on niche opportunities,
recognised as being a world class location for innovation and transaction execution by leveraging key
competitive strengths’. This report identi?ed a number of opportunities for Ireland in the ?nancial services
sector. In particular, it highlighted opportunities for Ireland to develop as a major centre for specialist debt/
?nancing products and securitisation, including risk securitisation. It also envisaged Ireland as a centre for
managing global/regional banking products and a centre of excellence for funds servicing. Opportunities
for Ireland to develop as a centre of scale in asset management and a pan-European location for insurance
products were also highlighted. Finally the potential for Ireland in the areas of software development and
as a centre for product development and innovation were also noted.
Building on Success noted that in order for the International Financial Services (IFS) sector to ful?l
its’ developmental potential in Ireland, the provision of high quality education and skills is essential.
Consequently, the Clearing House Group requested that a specialist study to be conducted by
the Expert Group on Future Skills Needs (EGFSN), to examine the issue skills and research relevant to
the sector.
Terms of Reference
In line with the recommendations in Building on Success the focus of this study is to identify the skills,
education, training and research needs of the industry. The terms of reference of this study were as follows:
To determine likely future skills required by leading international ?nancial services ?rms both in Ireland
and selected markets;
Based on the likely future development of the international ?nancial services industry, assess Ireland’s
ability to provide the necessary skills for this advancement of the industry through education, training
and research provision;
Based on identi?cation of best practice skills provision internationally, in particular the UK (London) and
USA (New York and Boston), to provide advice on meeting any gaps identi?ed in the study in regard to
Irish educational and/or training provision;
Identify existing ?nancial services programmes, niches and research competencies in Irish Institutes of
higher education;
Identify company research priorities (at a corporate level) and map them against the existing strengths
of their Irish subsidiaries and Irish academic strengths;
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Identify leading international academic ?nancial services institutions to assess best practice in relation
to skills training and research programmes, the delivery of research, their mechanisms to engage
industry in collaborative projects and how they collaborate internationally with other institutions;
Engage with leading ?nancial services companies to improve understanding of RD&I roadmaps and to
assess what these companies would expect of the Centre for Financial Services Skills and how they
might engage in the development and funding of research programmes; and
To provide policy advice on the role of the Centre for Financial Services Skills in this context.
Approach and Methodology
A sub-group of the EGFSN was established to guide this project. The various strands of the project are
outlined below:
Research and consultations with stakeholders undertaken by Forfás – as well as developing a detailed
terms of reference for the project, Forfás produced a background paper articulating a vision for IFS in
Ireland and engaged with a large number of stakeholders in the industry to ascertain their views on the
development of the sector.
Call for Submissions – A call for submissions from relevant parties was placed in the national press
at the beginning of the project. As a result, Forfás received a number of submissions from industry
and academia.
Research from the Skills and Labour Market Research Unit (SLMRU) in FÁS – The SLMRU have
produced a report analysing both current and future supply and demand for skills in the ?nancial
services sector. This analysis informs the other elements of the project.
Forfás, on behalf of the EGFSN engaged PwC to undertake an extensive national and international
consultation process to capture the views of industry and education and training providers, regarding
the likely development of the international ?nancial services sector in Ireland. This process included
29 interviews with 44 executives from a selection of leading ?nancial services providers in the areas of
banking and capital markets, investment management and insurance in Dublin, New York and London,
and 22 interviews with education and training providers in Ireland, the UK and the US. PwC also
facilitated a workshop which was attended by a number of industry representative bodies and training
organisations. Based on these consultations, PwC submitted a report to Forfás summarising the
feedback received.
All of these strands have been drawn together in this document.
In broad terms, the research approach has involved a high-level review based largely on qualitative
interviews with key informants. On the topic of course provision in particular, while the review of the
courses available from the selected providers is comprehensive, it is not intended to incorporate a detailed
audit of course provision in individual universities/colleges, and the report recommendations should
therefore be viewed in this context.
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International Financial Services Industry Overview
The term ‘international ?nancial services’, is typically used to encapsulate the three sectors of banking and
capital markets, investment management and insurance.
Figure 1 below provides an overview of these three sectors and their sub-sectors as well as identifying a
number of the key industry enablers.
Figure 1 International ?nancial services sector
At a global level, the sector is experiencing strong growth rates. The total value of global assets managed
on behalf of investors increased to reach $88.3 trillion in 2005 and the value of professionally managed
assets, across the top 28 national markets, grew by 15 percent in 2005 to $49.1 trillion.
Corporate
Finance
Structured
Finance
Investment
Banking
Treasury
Leasing
Discretionary
Fund Mgt.
Non-Discretionary
Fund Mgt.
Fund
Servicing
Trustee &
Custodian
Servicing
Transfer
Agency
Services
Life
Captive
Non-Life
Reinsurance
International Financial Services Universe
Banking &
Capital Markets
Investment
Management
Securitisation
Insurance
Regulator
Stock
Exchange
IT Vendors
Industry Enablers
Tax
Legal
Accountancy
Business/IT
Consultancy
Professional Services
Asset
Management
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Financial Services in Ireland
There are currently 148,000 people employed in ?nancial occupations across the Irish economy. It is
projected that by 2015, employment will have increased to approximately 187,000 persons; 45 percent of
these will be employed in clerical positions (c. 82,000 persons), 37 percent in professional/associate
professional (c. 70,000 persons) and the remainder in managerial occupations. According to the analysis,
the greatest employment growth is forecast to occur amongst accountants and banking clerks, although
signi?cant growth is expected in underwriting and taxation occupations.
The International Financial Services (IFS) sector, which is a sub sector of ?nancial services, has grown
dramatically in Ireland over the last 2 decades – banking assets have trebled from €422 billion in 2001 to
€1.2 trillion in 2006.
Impressive overall sectoral growth at a global level is also replicated in the individual sub-sectors in Ireland,
with the banking and capital markets sub-sector demonstrating 300 percent growth in banking assets in
Ireland from 2001 to the end of 2006, to stand at a value of €1.2 trillion at the end of 2006.
Similarly the investment management sub-sector demonstrated a compound annual growth rate of 32
percent over the past ?ve years, which exceeds the growth rate for European funds over the same period
of 11 percent. The value of funds serviced in Ireland is estimated to be €1.3 trillion and the sub-sector
employs in excess of 9,000 people across 11 counties.
The third and ?nal sub-sector of insurance is divided between life and non-life insurance. In line with the
European trends in insurance, the Irish based cross-border life insurance sector increased premium income
in 2006 by 25 percent to a value of €15.8 billion. Also in line with European and global trends, premiums
in the non-life sector remained relatively ?at at €3.27 billion in 2006.
On the whole, the IFS industry in Ireland is undergoing a process of evolution. The main drivers of
change from an Irish perspective were identi?ed during the course of consultations and are summarised in
Table 1 below.
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Table 1 Summary of key industry trends
Area Trends
Banking and
Capital Markets
Operations:
Industry is consolidating towards a smaller number of truly global providers, and
in streamlining their offerings these global providers have relocated elements of
their operations to centralised locations or “centres of ef?ciency”.
Organisations are focusing on technology enabled process innovation to achieve
increased ef?ciencies.
Risk management and regulation are key focus areas.
Ireland has established a reputation for expertise in debt products
and securitisation.
Products:
The product set is relatively stable but pricing mechanisms are becoming
more complex.
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Investment Management Industry Growth:
Strong growth in funds ?ows into Irish listed funds.
Ireland has established a reputation for listing and administration of funds.
Staff:
Some less specialised tasks are being transitioned out of Ireland as they no
longer align with the cost base. This trend is freeing up some capacity to take on
higher value middle-of?ce functions.
Staff turnover is providing a challenge to the cost base and service levels.
Ireland needs more graduates equipped with the skills to operate in front-of?ce
activities. In addition, the education system needs to provide more graduates with
specialist skills in emerging areas e.g. derivative structures and hedge funds.
Products:
Strong growth in the popularity of derivative and hedge fund products has
increased the levels of product complexity which has fed through the value chain
of support functions.
Growth in some front-of?ce operations is being constrained by a lack of suitably
skilled and experienced resources.
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Insurance Sales in pan-European and cross-border life products are increasing.
Ireland is establishing a reputation for capabilities in servicing
pan-European products.
The reinsurance market is showing strong potential for growth.
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IFS currently employs approximately 22,000 people in Ireland – just over 9,000 in investment
management, almost 10,000 in banking and capital markets and just over 3,000 in insurance.
On the whole, international ?nancial services companies continue to view Ireland as an attractive
investment proposition. This is due to a combination of factors, notably:
A favourable regulatory environment;
A favourable taxation environment;
Availability of experienced and knowledgeable staff;
A good geographic location which provides a natural bridge in time zones between market centres in
Asia and the US;
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An English speaking workforce; and
A culture/work ethic which is a hybrid of both US and EU cultures, allowing companies in Ireland to
work well with both markets.
All of these advantages will continue to contribute to the on-going development and expansion of the
international ?nancial services sector in Ireland, and are re?ected in the employment forecasts for the
sector. It is estimated that IFS employment in Ireland will increase by 9,700 to almost 32,000 by 2012,
as outlined in the table below
1
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Table 2 Estimated growth in employee numbers in the Irish international ?nancial services
sector 2006-2012
Sector 2006 2012
Banking 9,923 14,607
Senior management 1,985 2,922
Operational 7,938 11,685
Investment management/funds 9,227 13,631
Senior and mid management 2,108 3,4391
General and junior management 7,119 10,240
Insurance 3,027 3,614
Senior management 605 722
Operational 2,422 2,892
Total 22,177 31,852
Source: PwC derived – based on various assumptions.
These demand estimates are based on secondary data, feedback from consultations and a series of
assumptions. The basis for the calculations is further described in Section 3. The calculation provides a
basis for ‘guestimating’ the future demand for employees at senior and operational levels within each of
the three sectors of the international ?nancial services sector – banking, insurance and funds. The
estimated increase of 9,700 in employment levels in the sector is further detailed in Table 3.
Table 3 Breakdown of forecast employment growth by levels
Sector Growth in employee numbers from 2007-2012
Operational level Specialist/Middle-senior
management level
Banking 3,750 950
Funds 3,100 1,300
Insurance 500 100
Total 7,350 2,350
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1 These estimates are based on growth rates of:
10 percent for all banking roles;
3 percent for all insurance roles;
10 percent for senior roles in the funds sector; and
8 percent for operational roles in the funds sector, in 2006. .
All growth rates are adjusted downwards towards the end of the period.
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This equates to an average growth level of approximately 1,600 additional resources per annum,
approximately 400 at specialist/middle-senior management level and 1,200 at operational levels.
Combining employment growth of 9,700 with replacement requirement of just over 17,500 yields
a total recruitment requirement of almost 27,500, over the period from 2007 to 2012, or approximately
4,600 per annum.
Ireland’s young population (only 11 percent of the population over 65) relative to other European
countries results in a large proportion of the population belonging to “working age” demographics
2
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Further population growth combined with continued investment in our educational system will be critical
going forward to ensure there is a suf?cient supply of skilled resources to support the projected growth in
the ?nance and business sector of the labour market.
Skills Demands
While the Irish education system in seen as producing good quality graduates a number of industry
respondents highlighted that Irish graduates were perceived as “skilled generalists” and very rarely had
specialised knowledge in a particular area of ?nancial services, which would enable them to operate at
higher levels. This contrast was particularly marked when viewed against the US system, which facilitates
students specialising in particular niches which ensures a higher level of pro?ciency upon course
completion. This apparent lack of specialisation was also raised in the context of our market positioning
and cost base. It was suggested that if graduates were expecting to command above average levels of
remuneration then being a skilled generalist was not suf?cient as many competing centres also have high
volumes of “skilled generalists” available at lower labour cost rates. It was suggested that our education
system should provide a greater focus on specialising in a number of selected areas which would support
the development of an internationally distinctive competence which was more aligned with a mid to high
cost base.
A number of respondents commented on the lack of relevant work experience that many graduates now
have when seeking employment in the ?nancial services industry. The increasing trend towards travelling
during summer breaks to work in casual employment has resulted in a large number of graduates who
despite strong academic quali?cations lack experience of working in an of?ce environment. This was
termed as a lack of “industry readiness” in graduates. This contrast was particularly marked when viewed
against continental European countries where undergraduates are required to participate in a number of
internships as part of their educational studies. This ensures that they see the practical application of their
education in a live work setting, and as graduates, that they can adapt and contribute immediately as they
encounter less of a learning curve in entering the work environment.
Companies are also reporting serious problems with staff turnover which have been highlighted at
corporate levels (i.e. in the US). This is creating real disruption in company operations and compounding
the cost-base issues as competition for skilled resources for certain roles is leading to increases in
remuneration packages which are detrimental to overall competitiveness.
Further, there is ample evidence of skills needs at all points along the skills spectrum in relation to the IFS
industry. As a result, company operations are adversely impacted and, there is anecdotal evidence that the
insuf?cient numbers of high skilled graduates with appropriate quali?cations and skills is resulting in
potential IFS investments being diverted to other locations.
The quantitative and qualitative research found a high level of consistency in the types of skills and
occupations where companies experience needs or dif?culties in sourcing quali?ed staff, and these needs
are illustrated in Table 4, below.
2 Irish Times Report on CSO study – June 2007.
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The table also illustrates likely future skills needs. While the overall range of skill-sets is not expected to
change signi?cantly over the medium term, and the skills currently in short supply will continue to be
critical to the wellbeing of IFS, it was suggested that demand for skills in the future will be in?uenced by a
number of factors including:
Increasing regulation;
Technological development;
Off-shoring;
Increasing product complexity;
Product innovation; and
Further automation at lower levels.
Table 4 Summary of current and future skills needs
Current and future Future
1. Maths/Economics/Quantitative modelling
2. Accountancy (funds, audit and ?nancial reporting)
3. Risk management
4. Compliance
5. Middle-management with ?nancial
services experience
6. Project and change management
7. Funds servicing and banking back-of?ce
8. Actuary
1. Derivatives structuring
2. Quantitative analysis
3. Credit analysis
4. Hybrid technologists – business analysis with IT/
systems skills
5. Business development with detailed product
knowledge/industry quali?cations
6. Pan-European tax/legal specialists
7. Behavioural economists
8. Funds servicing – client relationship management for
complex products
9. Fluency in European languages
10. International compliance
For some of the higher skilled roles it was suggested that Ireland does not have the capacity in the short
term to produce these resources at the volume and speed required to support industry growth ambitions,
and therefore does not have the capacity to step up to support a distinctive competency in these higher
value chain activities. It was suggested that further enhancements of the recently introduced Green Card
scheme for non-EU workers and other measures to ensure that Ireland can continue to attract high-skilled
workers are required to provide greater support for ease of movement for highly skilled resources.
Finally, there is concern that Ireland’s positioning is not appropriate for a mid/high cost centre and is not
internationally distinctive. While elements of this sector are highly specialised, the resource intensive
elements are at the lower end of the skills range. This has resulted in Ireland having established an
international reputation and competency in the funds administration sector which does not easily align
with a higher cost base.
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International Financial Services 18 International Financial Services International Financial Services
Comparing Supply and Demand
A recent FÁS/SLMRU
3
report indicated that there are approximately 13,500 educational awards annually
in ?nancial services-related courses. Any attempt to calculate the quantity of skills supplied to the
international ?nancial services industry, however, is complicated by the diverse pool from which resources
can be drawn. Nevertheless, table 5 summarises the annual educational enrolments and awards of
relevance to the IFS industry (where data was available).
Table 5 Summary of estimated education output across ?nancial ?elds
Field Enrolments Awards
Higher education 5,000 1,200
4
Professional institutions 15,000 1,800
Accounting technician 5,500 4,300
Accounting 25,500 7,300
Actuarial studies 600 40
Economics and statistics 1,400 400
Tax 1,300 300
Higher education undergraduate 1,500 600
Higher education postgraduate 350 200
Professional institutions 4,600
CFA 300 50
FÁS 100 100
Finance and insurance 2,250 5,500
Risk 200 70
Total 31,250
5
13,610
Source: SLMRU report, 2007 (PwC amended).
Note: ?gures are rounded.
Of the potential supply indicated above, only a portion opts to pursue a career in international ?nancial
services. Many of the graduates/awardees are already in employment (e.g. the actuarial and accountancy
students) and many others go into employment in either domestic ?nancial services or non-?nancial
services sectors.
The industry consultations provided some insight into the nature and causes of the skills needs
experienced in the sector.
Speci?cally at operational levels, the lack of supply was primarily due to a shortage of personnel, but
also personnel with a quali?cation in insurance, ?nance and/or accounting, with a particular
international ?nancial services dimension.
Within the middle/senior management/specialist functional roles the lack of supply is due to:
The low number of graduates choosing a career in international ?nancial services;
The lack of graduates with a specialist knowledge of international ?nancial services;
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3 FÁS/SLMRU (2007) – A Study on the Future Skill Requirements of the Financial Services Sector, unpublished.
4 This ?gure was not in the SLMRU Report, but was subsequently provided to PwC by FÁS.
5 The enrolments ?gure for ‘Finance and Insurance – professional institutions’ was not available; hence the total ?gure for enrolments is understated in
the table above.
International Financial Services International Financial Services International Financial Services 19
The lack of graduates with specialist skills in areas such as: actuarial studies; economics; maths;
statistics; and international taxation; and
In the case of some roles, the limited availability of personnel with these skills, but also with
appropriate levels of experience e.g. middle management; risk management, etc.
In summary, the nature of the supply of educated personnel is not aligned to the education and skills
demands of the international ?nancial services industry.
To satisfy this demand, it is recommended that speci?c modules addressing these needs are added to
existing course curricula and where needed that new courses are introduced addressing the demand for
skills outlined in the recommendations chapter.
In essence, at foundation level the requirement is for short courses with ?exible delivery mechanisms,
aimed at bringing alternative populations of personnel (back) into the workforce in high numbers.
At undergraduate – graduate level the emphasis is on both: developing specialised modules which can
be updated regularly to re?ect industry trends and incorporated into existing degrees programmes; and
developing new or updating existing degree programmes to provide greater focus on particular skills
demands (e.g. tailored towards hybrid technologists or credit analysts). Where appropriate, applied or case
study elements and work experience should be incorporated into these programmes.
The postgraduate proposition is for specialist programmes of varying length focused on particular
specialist skills (e.g. international compliance, behavioural economics, etc.). Again these courses should
incorporate applied or case study elements. The focus at this level is primarily on new courses, which are
dynamic in nature, re?ecting latest industry trends.
Research, Development and Innovation (RD&I) in Financial Services
All of the research conducted to date indicates that formalised R&D functions in ?nancial services do not
appear to be commonplace in IFS in either Ireland or internationally. The speed of change within the
industry resulted in very short timelines which were not suited to more formal R&D cycles. Instead, the
term “innovation” has a greater resonance with the majority of ?nancial services organisations, and in
many cases innovation is viewed as being an integral part of maintaining competitiveness. Several of the
companies interviewed were actively pursuing opportunities to improve their products and processes
through innovation initiatives.
A number of key factors underpin the low level of RD&I activity, most notably:
A lack of collaboration between industry and educational institutions;
A lack of understanding of best practice processes for innovation;
The ?nancial risks associated with scale investments in R&D; and
The lack of government incentives/supports.
Where RD&I investments are undertaken, it is typically by the larger scale organisations which offer
diversi?ed products and services and where they are very often engaged in end-user delivery. Technology
plays a critical role in enabling the delivery and processing of ?nancial services products, and where
companies are making signi?cant investments in RD&I, these generally have a technology focus.
There is potential for Ireland to position itself as a solution centre rather than a market centre – at the
higher end of the skills spectrum academia could be involved in research into industry relevant themes
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International Financial Services 20 International Financial Services International Financial Services
which could then be used to provide Ireland with an advantage in complex product development e.g.
structured credit (CDOs), hybrid products, LIBOR market pricing model.
From an academic perspective, research is considered strategically important, with each of the international
institutions having at least one dedicated ?nancial services research centre. The primary purpose of these
research centres are to undertake research activity, however, many are also involved in organising
conferences, seminars and workshops to feed research ?ndings back to students and industry. Industry is
supportive of this research contributing to it via: funding for research centres; joint-research programmes;
student sponsorship; and the provision of/access to data. This differs from the situation in Ireland, with
academic institutions reporting a general lack of interest from industry in research. This re?ects the greater
focus on industry relevant themes in international institutions vis-à-vis Irish institutions. This can be partly
explained by the greater collaboration between industry and academia (referred to above) which occurs
internationally, and perhaps the fact that the ?ndings of research conducted within the International
institutions are typically fed back to students and/or industry via conferences, seminars, and workshops
while there is little evidence of this happening in Ireland.
In terms of funding for research, a combination of different sources have been identi?ed: universities, for
instance, reported receiving funding from a combination of different sources, including: Irish Government/
State Bodies (e.g. PRTLI, SFI, EI, IDA); the EU (e.g. FP7 Brussels); the University (including inter-institutional
funding); and Industry – however, funding from industry was found to be limited. Indeed, a number of
universities expressed concerns that the growth of ?nancial services research has been hugely limited by
the lack of available funding. In particular, the cost of purchasing data for ?nancial services research is
considered an enormous expense for Irish research providers. It was also considered that there is a
“disconnect” between the importance that the Irish Government attaches to ?nancial services research and
the actual funding that its makes available.
The Centre for Financial Services Skills
The concept of a Centre for Financial Services Skills, which would form a central support for the industry in
the areas of education, training and research, was proposed in the Building on Success Report published
by the Department of the Taoiseach and the Clearing House Group.
One of the strands of the Terms of Reference of this project requested the EGFSN to “provide policy advice
on the role of the Centre for Financial Services Skills”. Further, the EGFSN were also asked to provide advice
of the form of the proposed Centre.
As an input, opinions were sought from education providers and industry on the form the proposed Centre
might take. On balance, the consensus from both academia and industry was that a Centre should provide
a single point of contact for both industry and academia, while having responsibility for ensuring that the
skills and resources required to support the development of the industry are available.
Furthermore, it was suggested that a Centre would have responsibility for the coordination of education,
training and research (facilitating discussions with, and ensuring involvement between, both academia and
industry) as well as the promotion of the industry, in particular opportunities within it, in order to attract
suf?cient numbers of new employees from all groups i.e. secondary school students, back-to-work parents,
third level graduates, other industry sectors and overseas.
A model is outlined in the report to re?ect the balance of opinion expressed during the consultation
process. However, the EGFSN ask that the following considerations be taken into account if a Centre is to
be developed:
International Financial Services International Financial Services International Financial Services 21
Consideration should be given to how a Centre will interact with the current enterprise development
apparatus of the State. Any mechanism should be complementary to existing mechanisms and leverage
the expertise of existing State agencies;
While recognising the need for a relatively light structure, if developed, a Centre would need to have a
clearly articulated mandate and power to in?uence in a meaningful way the skills and research agendas
outlined in this report. Clear guidelines should be developed describing how the proposed structure
and activities of a Centre will derive its authority to in?uence and execute the functions and the
agendas that it may be assigned;
As well as establishing the mandate of a Centre, it will be crucial that it be provided with adequate
resources, budgets and reporting lines to ful?l any mandate it may be given; and
The Governance of any new entity needs to complement existing mechanisms for public/private
collaboration. Existing entities’ roles e.g. the Clearing House Group need to be clearly de?ned vis-à-vis
any proposed Centre.
The development of a Centre should not been seen as an end in itself and should not slow progress on
addressing the skills and research gaps outlined in this report. In ?nalising its recommendations, the Expert
Group has identi?ed the next steps which current stakeholders should take in order to progress the
signi?cant skills agenda which exists for the international ?nancial services industry. The development of an
alternative mechanism such as a Centre may over time provide a forum to continually address these issues,
but its absence in the short term should not de?ect attention from the core issues at hand.
There is an immediate task to be undertaken in identifying what education and training provision and
research can be undertaken within current resources and what additional funding is required and available
to address the remaining gaps recognising that both the State and industry have a role to play.
Conclusions and Recommendations
Due to the diverse nature of IFS, it is clear that no single solution will meet all of the challenges facing the
industry from a skills perspective. It is also clear, however, that there is a sense of urgency, amongst both
policymakers and amongst the industry itself, to take immediate action to rectify some of the more
pressing issues. This will help to protect the existing industry in Ireland which in turn, can act as the
foundation for the future development and expansion of the industry.
The EGFSN has outlined a range of challenges facing the IFS industry. Essentially, however, the challenges
can be grouped under four broad headings:
To urgently tackle current skills needs;
To address staff retention issues;
To put in place a skills pipeline that a) meets the likely future needs of the industry, and b) delivers a
supply of high skilled workers that can help to build the knowledge economy and shape the type of IFS
industry that develops in Ireland; and
To put in place the infrastructure (from a skills perspective) that will allow a ?nancial services research
agenda to develop in Ireland.
In response to these challenges, the EGFSN has identi?ed 6 key recommendations, incorporating 18
different elements.
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International Financial Services 22 International Financial Services International Financial Services
Summary of Recommendations
1 Education: Increase the supply of graduates
emerging from formal education with
appropriate skill sets to meet the needs of
the international ?nancial services industry.
This will require the introduction of new
education and training modules and/or
courses at graduate, postgraduate and
professional level.
Increase the numbers of graduates and postgraduates
undertaking courses and modules appropriate to the needs
of the IFS industry. Speci?cally, this requires the
development of new modules and, where appropriate, new
courses designed speci?cally to meet the needs identi?ed
in this report. Mathematical and technological skills sets are
fundamental to the industry.
Provide opportunities to specialise in speci?c areas of
?nancial services through elective modules e.g. derivatives
structuring, risk management, ?nancial modelling etc.
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Next Steps
(i) The international ?nancial services industry, through the of?ces of Financial Services Ireland (FSI) should
collectively agree on short-term priorities in relation to their skills needs as set out in this report in early 2008.
(ii) Higher Education Institutes should be provided with an opportunity to respond to the contents of this report.
The Higher Education Authority (HEA) should facilitate this consultation in early 2008. HEIs responses should
identify opportunities to address the recommendations within current funding; identify opportunities to
introduce modules onto existing programmes; and outline planned provision.
(iii) The HEA and FSI should work together through the Clearing House Group to agree an action plan to deliver the
prioritised skills sets. The Clearing House Group has established a subgroup to facilitate this process.
(iv) Having completed steps (i)-(iii) and identi?ed the remaining gaps that cannot be met through existing provision
and funding, the HEA should, subject to funding, issue a call for proposals.
2 Training: Introduce improved training
mechanisms to upskill new entrants into the
industry. In particular, the requirement to
expand the pool of labour available to
international ?nancial services ?rms will
require an expansion of the supply of
foundation level skills.
Develop mechanisms to support rapid skills development
to ensure that resources can develop the requisite
understanding of the industry and pro?ciency in core
areas e.g. 8-week intensive course incorporating
simulated environments.
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Next Steps
(i) FÁS currently offers a number of courses relevant to the international ?nancial services industry such as its
hedge fund administration course and is seeking to expand its offerings in the ?nancial services sphere in 2008.
The development of these programmes should be prioritised in consultation with industry.
(ii) The Clearing House Group subgroup supported by the Development Agencies should seek proposals from
other education and training providers such as the Vocational Education Colleges (VECs) and professional
institutes to deliver these skills.
3 Human Resource Management: In order to
expand the supply of labour available to
international ?nancial services ?rms,
innovative approaches to Human Resource
Management are required.
Evaluate the core skills and competencies required to
operate at foundation level and develop competency
pro?les for standard roles e.g. client servicing,
funds administration.
Identify alternative labour pools e.g. school leavers, parents
returning to the workplace, well educated migrant workers
currently employed in other sectors, who are capable of
performing foundation level roles and of meeting probable
skills needs.
In order to boost the stock of human capital, both
?rms and education providers should recruit world-class
talent, regardless of where that talent is to be found.
This requires a ?exible and attractive immigration system
that minimises the burden on both individuals and
their employers.
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International Financial Services International Financial Services International Financial Services 23
Next Steps
(i) A forum is required to bring together the HR managers from IFS companies to develop responses and share
best HR practices. This could be addressed by the Shared Services Forum.
(ii) The Expert Group on Future Skills Needs should continue to monitor the skills requirements of the IFS industry
and communicate these needs to the Employment Permits section of the Department of Enterprise, Trade
and Employment.
4 Awareness/Promotion: More effective
career advice and promotion is required to
highlight the career opportunities on offer in
the international ?nancial
services industry.
Promotion of ?nancial services career paths to second
level students, with a particular focus on high-level
mathematics students.
Promotion of career opportunities to third-level students,
focusing on students in business/?nance, mathematics/
statistics, engineering and technology courses.
Identi?cation and targeting of promotional activities
towards speci?c population groups, e.g. parents returning
to the labour force, those changing careers, migrants
working in other sectors etc.
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Next Steps
(i) The industry, coordinated by Financial Services Ireland, and supported by IDA Ireland and FÁS, should develop a
strategy for careers information. These bodies should ensure that all those involved with the provision of career
guidance and information are fully aware of the positive career opportunities within the industry.
5 Research: Establish an international ?nancial
services research capability in collaboration
with industry tasked with developing leading
edge thinking and solutions which are
shared through structured industry fora.
Identi?cation of key thematic areas of research by academia
that are relevant to industry requirements/interests.
Sharing of research undertaken by academia with industry
via ‘research seminars’ and ‘conferences’.
Research themes should also be expanded to include new
subjects in the humanities and emerging disciplines such
as behavioural economics.
Interaction between academia and leading international
researchers and education and training providers to identify
innovative areas of research.
Additional research funding to academia from industry, e.g.
sponsorship of research projects, research centres and
provision of data.
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Next Steps
(i) IDA Ireland, Enterprise Ireland, HEA and Science Foundation Ireland (SFI) on an ongoing basis will facilitate a
forum for industry and academia to jointly agree a research agenda that will be mutually bene?cial. The ?rst
forum should be held in early 2008.
(ii) Existing funding sources (SFI), the Irish Research Council for Science, Engineering and Technology (IRCSET) and
the Irish Research Council for the Humanities and Social Sciences (IRCHSS)) should be leveraged in order to
progress the international ?nancial services research agenda.
(iii) SFI plans to increase its funding of research in the area of ?nancial mathematics over the coming years. Any
funding should be cognisant of the ?ndings of this report.
(iv) Similarly, the Development Agencies currently operate a number of schemes to support their companies in
undertaking R&D activities research funding in the area of IFS. In particular, IDA Ireland is developing concepts
and speci?cally targeting R&D from ?nancial services companies.
International Financial Services 24 International Financial Services International Financial Services
6 Communications and Collaboration: Encourage
academic collaboration with industry to support
course development and delivery at graduate and
postgraduate level.
Improve linkages between academia and industry to
ensure the relevance of course curricula and
research topics.
Increase the frequency of course reviews and
reduce the time taken to revise course contents.
Examine mechanisms that provide for greater
?exibility in introducing topical, practical and
industry relevant modules and courses.
Encourage the use of industry placements and
internships as part of course delivery.
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Next Steps
(i) An ongoing mechanism is required to facilitate academic – industry collaboration. In the short term, the HEA
and FSI should facilitate a forum between industry and academia to discuss the skills needs outlined in this
report. This forum should take place on foot of the consultations undertaken in relation to Recommendation 1,
which deals with the supply of graduates. Such a forum should take place in early 2008.
International Financial Services International Financial Services International Financial Services 25
Chapter 1: Introduction
1.0 Introduction
The international ?nancial services industry is recognised as an area with potential for generating
high growth in enterprise development and economic output into the future. The industry has grown
dramatically in Ireland since its inception in 1987 to form a vital part of the Irish economy, and is now a
major contributor to Ireland’s economic strength. In 2006 the international ?nancial services industry was
responsible for 5 per cent of the country’s GDP and according to the Bank of International Settlements,
Ireland is now ranked as the eleventh largest international market in the world based on the cross border
positions of banks.
Despite the success to date in attracting leading players there is recognition across the industry that this
industry is highly mobile, and that Ireland needs to continue to invest to ensure the on-going development
and growth of this sector.
1.1 Background to the Expert Group Study
The Government strategy document, Building on Success, published in 2006 outlined a set of proposals for
the further development of the international ?nancial services industry in Ireland. This report set out a
framework which identi?ed ?ve priority areas for development, which are required to sustain Ireland’s
competitive advantage in the ?nancial services industry.
The ?ve areas identi?ed were:
(i) Flexible and sound regulatory environment;
(ii) Attractive legislative and ?scal environment;
(iii) Expertise in markets;
(iv) World class skills, education and training; and
(v) Product development/innovation/R&D.
Investment in world-class skills, education and training was recognised as one of the critical elements
required to compete in, and advance to the top of, the “value chain” of the international ?nancial
services industry.
Subsequently, the Clearing House Group asked that a specialist study be undertaken by the Expert Group
on Future Skills Needs (EGFSN) to consider the skills needs of current and future activities in the sector and
to identify the types of additional educational provision required to meet the future skills needs of the
industry. Having identi?ed the industry needs, this study should also provide a roadmap to support the
delivery of the associated educational provision to meet these needs.
International Financial Services 26 International Financial Services International Financial Services
1.2 Terms of Reference
In line with the recommendations in Building on Success the focus of this study is to identify the skills,
education, training and research needs of the industry. The terms of reference of this study were as follows:
To determine likely future skills required by leading international ?nancial services ?rms both in Ireland
and selected markets;
Based on the likely future development of the international ?nancial services industry, assess Ireland’s
ability to provide the necessary skills for this advancement of the sector through education, training and
research provision;
Based on identi?cation of best practice skills provision internationally, in particular the UK (London) and
USA (New York and Boston), to provide advice on meeting any gaps identi?ed in the study in regard to
Irish educational and/or training provision;
Identify existing international ?nancial services programmes, niches and research competencies in Irish
Institutes of higher education;
Identify company research priorities (at a corporate level) and map them against the existing strengths
of their Irish subsidiaries and Irish academic strengths;
Identify leading international academic ?nancial services institutions to assess best practice in relation
to skills training and research programmes, the delivery of research, their mechanisms to engage
industry in collaborative projects and how they collaborate internationally with other institutions;
Engage with leading international ?nancial services companies to improve understanding of RD&I
roadmaps and to assess what these companies would expect of the Centre for Financial Services Skills
and how they might engage in the development and funding of research programmes; and
To provide policy advice on the role of the Centre for Financial Services Skills in this context.
1.3 Approach and Methodology
A sub-group of the EGFSN was established to guide this project. The various strands of the project are
outlined below:
Research and consultations with stakeholders undertaken by Forfás – as well as developing a detailed
terms of reference for the project, Forfás produced a background paper articulating a vision for IFS in
Ireland and engaged with a large number of stakeholders in the industry to ascertain their views on the
development of the sector.
Call for Submissions – A call for submissions from relevant parties was placed in the national press
at the beginning of the project. As a result, Forfás received a number of submissions from industry
and education and training providers.
Research from the Skills and Labour Market Research Unit (SLMRU) in FÁS – The SLMRU have
produced a report analysing both current and future supply and demand for skills in the international
?nancial services sector. This analysis will inform the other elements of the project.
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International Financial Services International Financial Services International Financial Services 27
Forfás, on behalf of the EGFSN engaged PwC to undertake an extensive national and international
consultation process to capture the views of industry and education and training providers, regarding
the likely development of the international ?nancial services sector in Ireland. This process included
29 interviews with 44 executives from over 20 companies in Dublin, New York and London, and 22
interviews with education and training providers in Ireland, the UK and the US. PwC also facilitated a
workshop which was attended by a number of industry representative bodies and training
organisations. Based on these consultations, PwC submitted a report to Forfás summarising the
feedback received.
All of these strands have been drawn together in this document.
In broad terms, the research approach has involved a high-level review based largely on qualitative
interviews with key informants. On the topic of course provision in particular, while the review of the
courses available from the selected providers is comprehensive, it is not intended to incorporate a detailed
audit of course provision in individual universities/colleges, and the report recommendations should
therefore be viewed in this context.
Target Company Selection
The target list of companies to be interviewed was agreed in advance based on discussions between PwC,
Forfás, IDA Ireland and industry representative bodies.
Interviews were carried out at a senior level in each company, with people who were considered to have a
good perspective on the company’s strategic plans and the likely impact on skills and research needs going
forward. Key informants typically were drawn from a range of senior management roles including
Managing Director, VP/Director of Human Resources, Chief Operating Of?cer, Chief Technology Of?cer and
Head of Risk Management etc.
International Academic Institution Selection Criteria
The international academic institutions consulted, as part of this programme of work, were selected based
on a number of criteria, namely:
Industry recognition of the institution;
Other universities/colleges recognition of the institution;
Accreditation of the institution i.e. Financial Times ‘Best Business School’ and Guardian University
Guide; and
Achieved RAE rankings for research undertaken.
Interviews were conducted with senior faculty members from departments/faculty involved in the
provision of ?nancial services related courses i.e. ?nance, business, economics and mathematics faculty.
In addition, a number of faculty involved in various institutions dedicated research centres were
also consulted.
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International Financial Services 28 International Financial Services International Financial Services
1.4 Report Structure
This introduction is the ?rst of seven chapters in the report. The remainder of this report comprises 6
additional chapters. An overview of the remaining chapters content is provided below.
Chapter 2 provides a contextual background to the study by describing the international ?nancial services
environment. This includes an overview of the global and Irish international ?nancial services market and a
review of recent industry trends and key drivers of change. This chapter also examines the current numbers
employed and the potential growth over the medium term.
Chapter 3 seeks to assess the demand for international ?nancial services skills, based on in-depth
discussions with the target companies. This chapter includes a review of existing skills needs and outlines
future skills requirements within the international ?nancial services industry. This chapter also reviews the
supply-side dynamics to provide additional context against which industry growth is reviewed.
Chapter 4 comprises a review of the Irish Financial Services Skills and Research Providers.
Chapter 5 reviews skills provision and research in a number of selected international institutions and then
compares and contrasts the Irish and international situation.
Chapter 6 looks speci?cally at the topic of research and innovation in international ?nancial services and
the role that support structures could play in fostering and supporting leading edge industry research. To
do this, the chapter examines the evidence available from three sources – a review of international
literature on RD&I strategies, the evidence from discussions with leading-edge international ?nancial
services companies, and the evidence from discussions with US and Irish education providers.
Chapter 7 examines the role that the proposed Centre for Financial Services Skills could play in supporting
and enabling development initiatives in the sector.
Chapter 8 concludes the report by summarising the key ?ndings arising from the earlier chapters skills and
the key conclusions and outlines the recommendations arising from these ?ndings.
International Financial Services International Financial Services International Financial Services 29
Chapter 2: International Financial
Services Sector
2.0 Introduction
The purpose of this chapter is to provide contextual background to the international ?nancial services
sector, both globally and in Ireland, and to highlight the scale and growth of this sector in Ireland since the
establishment of the IFSC in 1987. The main areas covered in this chapter are:
The international ?nancial services landscape;
An overview of each of the sectors within the international ?nancial services market; and
International ?nancial services sector in Ireland.
2.1 International Financial Services Landscape
The term ‘international ?nancial services’ is an umbrella term which is typically used to describe the three
areas of banking and capital markets, investment management and insurance. Figure 2.1 below provides a
summary of the principal components of each of these areas and some of the key industry enablers.
Figure 2.1 International ?nancial services sector
Source: PWC Derived.
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Corporate
Finance
Structured
Finance
Investment
Banking
Treasury
Leasing
Discretionary
Fund Mgt.
Non-Discretionary
Fund Mgt.
Fund
Servicing
Trustee &
Custodian
Servicing
Transfer
Agency
Services
Life
Captive
Non-Life
Reinsurance
International Financial Services Universe
Banking &
Capital Markets
Investment
Management
Securitisation
Insurance
Regulator Stock
Exchange
IT Vendors
Industry Enablers
Tax
Legal
Accountancy Business/IT
Consultancy
Professional Services
Asset
Management
International Financial Services 30 International Financial Services International Financial Services
Despite being shown separately above, the traditional offerings of banks, asset managers and insurers
are increasingly converging as these organisations enter new sub-sectors which span the “traditional”
sector divides.
The size and shape of the international ?nancial services sector is also undergoing signi?cant change driven
by a number of key factors, which include:
Demographics – the “greying economy” and increasing reliance on private pensions;
Economic cycles – maturing developed economies and high growth emerging economies;
Politics – cross-border integration and increased requirements for transparency;
Product sophistication – increased product sophistication e.g. hedge funds, derivatives;
Regulation and reporting – increased regulatory requirements e.g. CRD, MiFiD; and
Technology – integration of platforms, automated processing and timely access to information.
Due to the overall scale, differing categorisations of the sub-sector components, increasing convergence
across sub-sectors and the dynamic nature of asset values, it is dif?cult to provide a de?nitive sizing of the
international ?nancial services market. However, despite this, there are a number of indicators which
provide a view on the overall industry scale and growth trends, namely:
Total value of global assets managed on behalf of investors increased to reach $88.3 trillion in 2005
6
;
The value of professionally managed assets across the top 28 national markets grew by 15 percent to
$49.1 trillion in 2005
7
; and
The stock of shares and public and private debt securities held in America grew from 2.4 times GDP in
1995 to 3.3 times GDP in 2004. These ?gures do not include derivatives, notional amounts traded
privately or over-the-counter (OTC) securities which have grown from $258 trillion in 2004 to $370
trillion in 2006
8
.
All of the above indicators point to an industry which is experiencing strong rates of growth. International
?nancial services have become a key driver of growth for several advanced economies, contributing
signi?cantly to GDP and overall employment. In the US for example, the ?nancial services sector is the third
largest contributor to GDP at 8 percent and has averaged an annual growth rate of 5 percent over the past
decade
9
. In the UK, the ?nancial services sector contributes 6 percent to GDP and employs 4 percent of the
national workforce.
The international markets for banking and capital markets, investment management and insurance are
described in further detail below
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6 Boston Consulting Group Wealth Report December 2006.
7 Boston Consulting Group Wealth Report December 2006.
8 The Economist – Special Report Alchemists of Finance, May 2007.
9 Sustaining New York’s and the US Global Financial Leadership – McKinsey
10 UK Skills Bill – Part 1, 2007.
International Financial Services International Financial Services International Financial Services 31
Sector Overview – Investment Banking and Capital Markets
Investment banking and capital market activities is the term used to describe trading debt, equities, ?xed
income, funds, foreign exchange, commodity and derivative instruments and the origination of equity
?nance. Figures 2.2, 2.3 and 2.4 provide a summary of global trends for these investment banking and
capital markets activities by illustrating
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Trading volumes for equities and bonds;
Corporate ?nance and advisory revenues; and
The value of equity origination.
Figure 2.2 Global trends in trading volumes and bonds
Figure 2.3 Global trends in corporate ?nance/advisory volumes
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0
4
8
12
Q1/04 Q1/04 Q1/04 Q1/04 Q1/04 Q1/04 Q1/04
Equity Trading
Trading Volumes
600
800
1,000
1,200
US Bond Trading
Q1/04 Q3/04 Q1/05 Q3/05 Q1/6 Q3/06 Q1/07
EMEA
Americas
Asia Pacific
$T $B
0
200
400
600
800
Q1/04
Q3/04 Q1/05 Q3/05 Q1/06 Q3/06 Q1/07
Corporate Finance/Advisory Volumes
M&A Advisory
2
EMEA
Americas
Asia Pacific
11 BCG Investment Banking and Capital Markets Report – May 2007.
International Financial Services 32 International Financial Services International Financial Services
Figure 2.4 Global trends in equity origination
Source: BCG Investment Banking Report – Q1 2007.
A further breakdown of investment banking and capital market sector revenues by location of headquarter,
as illustrated in Table 2.1 below, shows that North America remains the largest market by value, but that
Europe is recording a faster pace of growth and higher operating margins
12
.
Table 2.1 Breakdown of investment banking and capital markets by location of headquarters
Geography 2006 2005 YoY revenue
growth
Avg. operating
margin
North America 232,386 191,937 18% 33%
Europe 212,971 173,943 22% 43%
Asia 101,139 90,488 16% 37%
Source: McKinsey CIB 50.
The top ten corporate and investment banking companies in 2006 ranked by revenues are detailed in
Table 2.2 below.
13
Table 2.2 Top 10 corporate and investment banking companies 2006
Company 2006 revenues ($m) 2005 revenues ($m) YoY revenue growth
1 Goldman Sachs 28,374 20,054 41%
2 Morgan Stanley 20,215 15,063 34%
3 Citigroup 20,120 17,172 17%
4 Deutsche Bank 20,095 16,092 25%
5 Merrill Lynch 18,917 13,844 37%
6 UBS 17,350 14,035 24%
7 JPMorgan Chase 17,170 13,137 31%
8 Credit Suisse 16,655 12,254 36%
9 Lehman Brothers 15,166 12,701 19%
10 Royal Bank of Scotland 12,580 10,179 24%
Source: McKinsey CIB 50.
Note: According to the IBF several of the top 10 banks such as Citigroup, Merrill Lynch and JP Morgan have established
wholesale banking operations in Ireland.
0
20
40
60
80
Q1/04 Q3/04 Q1/05 Q3/05 Q1/06 Q3/06 Q1/07
$B
EMEA
Americas
Asia Pacific
12 McKinsey Global Corporate Investment Banking 50 – August 2007.
13 McKinsey Global Corporate Investment Banking 50 – August 2007.
International Financial Services International Financial Services International Financial Services 33
All of the top ten companies experienced signi?cant double-digit growth rates in revenues in 2006. Total
revenues for the investment banking and capital markets sector have shown an annual increase of 22.7
percent in 2007.
Sector Overview – Investment Management
The total assets managed by the world’s 500 largest asset managers increased by 10 percent in 2005 to
reach $53.6 trillion
14
. The largest European based managers have continued to increase their share of
assets under management accounting for half of the top 20 fund managers and 57 percent of the assets,
an increase of 5 percent on 2004
15
.
The top ten global asset managers in 2005 ranked by value of assets are shown in Table 2.3 below.
16
Table 2.3 Top 10 global asset managers
Company Country Assets ($m)
1 UBS Switzerland 2,016,000
2 Barclays Global Investors UK 1,513,043
3 Allianz Group Germany 1,493,488
4 State Street Global US 1,441,058
5 Fidelity Investments US 1,421,903
6 AXA Group France 1,260,202
7 Capital Group US 1,165,754
8 Credit Suisse Switzerland 1,128,365
9 Deutsche Bank Germany 1,026,875
10 Vanguard Group US 957,589
Source: Watson Wyatt Fund Management World Rankings.
Note: According to the Dublin Finance Yearbook several of the top 10 asset management companies such as Allianz,
State Street, Fidelity, Axa, AIG and Zurich Financial Services have established operations in Ireland.
The European investment fund market has continued to show strong growth rates with total net assets in
Q1 2007 in excess of €7,574 billion
17
. Ireland and Luxembourg have experienced exceptional rates of
growth as many of the larger investment management companies have selected either of these locations
as part of a migration to a single-hub strategy. While European funds have grown at a rate of 11 percent
over the past ?ve years, Ireland has experienced a Compound Annual Growth Rate (CAGR) of 32 percent
18
.
Ireland and Luxembourg accounted for €285 billion of net ?ows in 2006, equating to 89 percent of total
European subscriptions
19
. Luxembourg still dominates overall funds ?ows but Ireland has established a
lead in the money market sector.
Table 2.4 shows the signi?cant growth which has occurred in the European funds industry during the
period 2002-2006.
14 Watson Wyatt Fund Management World Rankings 2006.
15 Watson Wyatt Fund Management World Rankings 2006.
16 Watson Wyatt Fund Management World Rankings 2006.
17 KPMG, State of the Investment Management Industry in Europe, July 2007.
18 European Fund Market Data Digest 2007, FERI, p21.
19 European Fund Market Data Digest 2007, FERI, p21.
International Financial Services 34 International Financial Services International Financial Services
Table 2.4 Growth in European funds industry 2002 to 2006
2002 €m 2003 €m 2004 €m 2005 €m 2006 €m
Assets 2,817,125.5 3,234,896.5 3,604,159.0 4,589,144.2 5,083,298.2
Growth -147,494.0 417,771.0 369,262.6 984,985.2 494,154.0
Net sales 141,258.1 219,286.6 133,021.1 364,946.5 320,677.3
Performance -288,752.1 198,484.4 236,241.5 620,038.7 173,476.7
Sales as % of growth 52.5% 36.0% 37.1% 64.9%
Source: European Fund Market Data Digest 2007, FERI.
The implementation of the UCITS III directive has provided a spur to market growth levels, which has
driven new sales volumes and launched the industry into a new phase of product development. Some
market analysts such as FERI are forecasting that based on a cautious estimate the industry will grow from
€5 trillion to €8 trillion by 2011, equating to an annual growth rate of 10.2 percent
20
.
Figure 2.5 shows that UCITS based funds have been major drivers of the growth of European
Investment funds
21
:
Figure 2.5 Net assets of European investment funds (€billions)
Source: EFAMA Trends in the European Investment Fund Industry, March 2007.
20 European Fund Market Data Digest 2007, FERI, p9.
21 EFAMA, Trends in European Investment Funds Industry, Q1 2007.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2002 2003 2004 2005 2006
8,000 UCITS
Non-UCITS
International Financial Services International Financial Services International Financial Services 35
In 2006, UCITS funds were the main contributor to the growth in European assets with annualised growth
of 15.1 percent. The use of derivatives in a portfolio under UCITS III has facilitated increased levels of
?exibility in product construction allowing for an expansion of funds offering absolute and total return
market strategies.
Sector Overview – Insurance
Worldwide insurance premiums reached $3,726 billion in 2006 with year-on-year growth in total premium
volume of 5 percent (adjusted for in?ation)
22
. The main driver of growth was the life sector which showed
an annual increase of 7.7 percent, whereas the non-life sector grew by a more modest 1.5 percent
23
.
Growth in premiums was driven mainly by emerging markets which increased by 16 percent, whereas the
more mature industrialised countries experienced a growth rate of 4 percent.
Table 2.5 provides a geographic breakdown of changes in insurance sector premiums in 2006.
Table 2.5 Geographic breakdown of changes in insurance premiums 2006
Life premiums Non-Life premiums Total premiums
US $bn % change
vs 2005
US $bn % change
vs 2005
US $bn % change
vs 2005
Industrialised countries 2,038 6.6% 1,357 0.6% 3,390 4.0%
United States 534 3.6% 638 1.0% 1,170 2.1%
Japan 363 (2.0%) 97 0.3% 460 (1.5%)
United Kingdom 312 30.2% 107 (2.1%) 418 20.1%
Germany 95 2.4% 110 (1.0%) 205 0.6%
France 178 15.1% 73 1.1% 251 10.6%
Italy 90 (7.5%) 49 0.3% 139 (4.9%)
Emerging Markets 176 21.1% 157 10.8% 333 16.3%
Latin America and Caribbean 29 14.1% 43 10.0% 71 11.6%
Central and Eastern Europe 13 19.2% 43 9.2% 56 11.4%
South and East Asia 97 23.6% 42 14.5% 138 20.8%
Middle East and Central Asia 5 5.3% 14 5.7% 19 5.6%
Africa 35 21.6% 14 6.2% 50 17.5%
World 2,209 7.7% 1,514 1.5% 3,726 5.0%
Source: Swiss RE Sigma Study of World Insurance 2006.
22 Swiss Re Sigma Study on World Insurance 2006.
23 Swiss Re Sigma Study on World Insurance 2006.
International Financial Services 36 International Financial Services International Financial Services
Table 2.6 provides a breakdown of European premium income and growth rate by insurance category:
Table 2.6 European breakdown of premium income and growth rate by category
Premium income (€bn) Growth Rate
2005 2006 2005/2004 2006/2005
Life 618.3 659.3 9.7% 4.4%
Non-life 377.0 405.9 1.6% 5.3%
Motor 127.3 128.9 1.7% -1.0%
Health and Accident 94.4 115.6 4.5% 20.2%
Property 79.1 82.1 4.2% 1.6%
General liability 32.8 33.9 3.8% 1.4%
MAT 12.9 12.2 -2.1% -7.6%
Legal Expenses 5.9 6.5 5.7% 8.8%
Others 24.4 26.7 11.8% 7.5%
Total 995.3 1065.1 6.4% 4.8%
Source: CEA, Insurers of Europe Annual Report.
Collectively, European insurance markets grew by 4.8 percent in 2006 with premium income exceeding the
€1 trillion mark to reach €1.065 trillion
24
. Life premiums continue to account for the majority of income at
€659 billion, representing an annual growth rate of 4.4 percent. Product innovations in the areas of
occupational pensions and unit-linked products with capital guarantees have proven to be key drivers of
this growth. The European non-life sector experienced growth of 5.3 percent in 2006, however, a
signi?cant proportion of this growth was attributable to the privatisation of the health system in the
Netherlands
25
. At a European level the insurance industry is likely to experience a signi?cant period of
change over the next two years as Solvency II requirements are implemented.
Tables 2.7 and 2.8 below show the top ten global life and non-life insurance companies in 2007 as ranked
by revenues.
26
Table 2.7 Top 10 global life insurance companies 2007
Company Revenues $m
1 ING Group 158,274.3
2 AXA 139,738.1
3 Assicurazioni Generali 101,810.7
4 Aviva 83,487.0
5 Prudential 66,133.5
6 Nippon Life 56,624.0
7 CNP Assurances 55,583.8
8 Met Life 53,275.0
9 Aegon 45,939.1
10 Dai-Chi Mutual Life 40,145.5
Source: Fortune Global 500.
Note: According to the Insurance Statistical Review 2006, several of the top 10 life companies such as Axa, Aviva
(through Hibernian), Prudential, CNP Assurances and Aegon have established operations in Ireland.
24 CEA Insurers of Europe, Annual report 2006-2007.
25 CEA Insurers of Europe, Annual report 2006-2007.
26 Fortune Global 500 – July 23 2007.
International Financial Services International Financial Services International Financial Services 37
Table 2.8 Top 10 global non-life insurance companies 2007
Company Revenues $m
1 Allianz 125,346.0
2 American International Group 113,194.0
3 Berkshire Hathaway 98,539.0
4 Zurich Financial Services 65.000.0
5 Munich Re Group 58,183.2
6 Millea Holdings 36,066.9
7 Allstate 35,796.0
8 Swiss Reinsurance 32,117.6
9 Hartford Financial Services 26,500.0
10 Travelers Co’s 25,090.0
Source: Fortune Global 500.
Note: According to the Insurance Statistical Review 2006, several of the top 10 non-life companies such as Allianz, AIG,
Zurich Financial Services have established operations in Ireland.
Industry reports suggest that strong demographic and social trends are expected to support continued
growth in the life insurance sector, as maturing populations focus on savings and pensions products to
provide for their future welfare. Whereas, the non-life sector is expected to experience sluggish rates of
growth over the near-term in industrialised economies with the majority of growth coming from
emerging markets.
2.2 International Financial Services Sector in Ireland
The international ?nancial services sector in Ireland has grown dramatically over the past 20 years as
outlined earlier. The rapid growth of this sector in Ireland and Ireland’s emergence on the international
stage as a ?nancial centre is evidenced by the following statistics
27
:
Banking assets have trebled from €422 billion in 2001 to €1.2 trillion in 2006;
The value of fund assets under administration has trebled from $430 billion in 2002 to $1.3 trillion in
March 2007
28
;
Ireland is now the largest exchange for funds listings with over 4,300 listed in 2006;
Ireland is the number one centre for cross border life insurance in Europe. The international insurance
market comprises 660 companies writing foreign risk insurance business with gross premium income
in excess of €15 billion;
Ireland has established a leadership in the global market for alternative investments with an estimated
$600 billion of assets being serviced here in March 2007
29
; and
Ireland is ranked second in Europe for money market funds with assets of $104.2 billion in
September 2006.
?
?
?
?
?
?
27 Finance Dublin Yearbook 2007.
28 Irish Funds Industry Annual Newsletter 2007.
29 Irish Funds Industry Annual Newsletter 2007.
International Financial Services 38 International Financial Services International Financial Services
Employment
This section is based on secondary data, feedback from consultations and a series of assumptions. The
basis for the calculations is outlined below. The calculation provides a basis for ‘guestimating’ the future
demand for employees at senior and operational levels within each of the three sectors of the international
?nancial services sector – banking, insurance and funds. Any interpretation of the data should re?ect this.
International Financial Services Sector – Total Employment
There are a number of sources of estimated current employment levels identi?ed for the international
?nancial services sector. The composite ?gures for the three sectors of banking, investment management/
funds, and insurance appear to fall within the range of 15,590, as noted in the Forfás Annual Employment
Survey, to a ?gure of up to 24,000 quoted by the IDA
30
. The variances may be due to the data de?nitions
used, each of which differs slightly. Other sources of employment ?gures, which fall within this range
include the National Treasury Management Agency’s Ireland Information Memorandum 2006 document
which refers to a ?gure of 21,000, while the IBF (Irish Bankers Federation) pre-budget submission for 2006
refers to a ?gure of 19,000. Mid-way within this range is the ?gure provided by Finance Dublin Yearbook
2007, of 22,177, which is based on a census of the employees at each company listed in the Yearbook. This
?gure, broken down between the three sectors of banking, funds and insurance, is used as an estimate of
the current employment levels in the international ?nancial services sector.
These ?gures are provided in the table below for 2006 and 2005.
Table 2.9 Employment ?gures by sector 2005/2006
Sector 2006 2005 Change % change
Banking 9,923 8,008 1,915 24%
Investment management/funds 9,227 8,144 1,083 13.3%
Insurance 3,027 2,943 84 3%
Total 22,177 19,095 3,082 16.1%
Source: Finance Dublin Yearbook 2007.
International Financial Services Sector – Employment in the Banking Sector
While employment ?gures for the composite banking sector are available, again there is a lack of data
readily available on employment levels within the international banking sector. However, in a speech to the
IBF Conference in September 2007, An Taoiseach indicated that there are 41,000 people employed in the
Irish banking industry of which 32,000 are employed by the major retail banks. By and large the major
retail banks are not typically categorised as being part of the International Financial Services Sector insofar
as their primary area of focus is on the domestic market. Therefore, the balance of 9,000 employees
provides an indication of the numbers employed in international banking activities. This is not signi?cantly
dissimilar to the ?gure in the table above of 9,923 employees in international banking for 2006.
30 In a commercial pro?le/advertisement in the Business Week publication.
International Financial Services International Financial Services International Financial Services 39
International Financial Services Sector – Employment in the Funds Industry
The funds industry in Ireland is primarily international and therefore it is easier to isolate the employment
?gures for this sector. In a recent FÁS/SLMRU (Skills Labour Market Research Unit) report on the Future
Skills Requirements of the Financial Services Sector, it was indicated that of the total number employed in
?nancial occupations of 148,000, 41 percent or 61,000 are employed directly in the ?nancial
intermediation sector, which includes both the domestic and international elements of the banking,
insurance and funds sectors. Further, the funds sector accounts for 12 percent of this ?gure, which equates
to 7,300 people. This is broadly in line with an Irish Funds Industry Association Employment and Staf?ng
Survey which indicated that the number of employees in funds industry companies in Ireland was 6,800 in
January 2006. However, a recent Deloitte report – the 2007 Fund Administration Survey – put the number
of people working directly in the fund administration business in Ireland at 9,000. In addition to the fund
administration aspect of the funds industry, the asset management aspect incorporates approximately
2,500 people, according to industry sources. Therefore, employment within this sector ranges between
6,800 and 9,000 plus. Again, the ?gures in Dublin Finance Yearbook of 9,227 are within this range, and
therefore it was decided to use these ?gures as the basis for further estimates.
International Financial Services Sector – Employment in Insurance
The IIF estimates that the domestic insurance sector employs in excess of 14,000 people, with the
international insurance sector being comparatively smaller, with Finance Dublin estimating the number
employed at 3,027 people. According to the Finance Dublin Yearbook, annual employment growth in the
international sector was estimated to be 3 percent in 2006 (down from 8 percent in 2005). The Dublin
International Insurance and Management Association is the largest representative body for this sector and
undertakes a survey of the numbers employed by its member ?rms which it estimates to be just under
1,000 people. However, this only includes member ?rms and is does not typically include life insurance
elements. As the Finance Dublin Yearbook ?gure is based on a census of all ?rms in the sector it was
decided to use these ?gures as the basis for further estimates.
Regionalisation
One of the most notable features in recent years of the international ?nancial services sector in Ireland has
been the successful transition to a regionalised structure, with ?rms now dispersed beyond the original
IFSC designated area of Dublin. This regionalisation offers ?rms the opportunity of doing business in a
lower cost location, compared with Dublin. Major ?nancial services operations have now been established
in 10 counties outside of Dublin by ?rms such as State Street (Kilkenny), PFPC (Wexford), Sun Life
(Waterford) and Daiwa (Dundalk), which has further boosted the strength of the sector, by providing
access to new labour markets while also bringing substantial economic bene?ts to regional areas.
An IFIA
31
survey for 2006 indicates that 950 people were employed in the funds industry outside Dublin at
January 2006.
In conclusion, Ireland has successfully built internationally recognised competencies in the areas of
international banking, funds and insurance. In particular, Ireland is now recognised as one of Europe’s
leading fund servicing centres and attracted the third highest in?ow of new funds in Europe in 2006, and is
also viewed as a leader in alternative investment products
32
. Ireland is also considered a leader in debt
securities and was ranked as the ninth largest centre for issuers of international debt securities, by
residence of issuer, by the Bank of International Settlements in 2006
33
.
31 Irish Funds Industry Association (IFIA) Employment and Staf?ng Survey 2006.
32 Irish Funds Industry Annual Newsletter 2007, p5.
33 Bank of International Settlements – Quarterly Review, June 2007.
International Financial Services 40 International Financial Services International Financial Services
2.3 Ireland – Banking and Capital Markets Sector
Within the past twenty years, 25 of the top 50 international banks have established operations in Ireland,
including international giants such as Citigroup, JP Morgan, BNP Paribas, Depfa and Merrill Lynch
34
. In
December 2006, banking assets in Ireland stood at €1.2 trillion representing a 300 percent increase over 5
years. According to the Bank of International Settlements, Ireland was ranked as the 11th largest
international market in the world based on the external or cross border positions of banks in 2006
35
.
The key areas of international banking operations include:
Investment banking;
Structured ?nance;
Wealth management;
Debt issuance and securitisation;
Treasury management; and
Asset ?nancing/leasing.
Although a full range of international banking services is provided from Ireland, speci?c competencies in
this sector have been developed in the following key areas:
Table 2.10 Speci?c Irish competencies in the banking and capital markets sector
Area Details
Debt products
and Securitisation
Debt products is an area where Ireland has developed a strong proposition and is now ranked
as one of the leading centres for issuers of international debt securities by residence of
issuers. This Irish market has grown to €75bn in ?ve years, placing Ireland as the 6th largest
debt market worldwide. The issuance of Irish asset covered securities (ACS) totalled €9.6
billion in 2006
36
. Legislation introduced to support ACS transactions has proven successful in
attracting large institutions such as Depfa and West LB, however, several countries have since
replicated this structure, which may limit the pace of future growth.
Ireland’s securitisation sector has also continued to experience strong rates of growth
during 2006. Management of asset backed securities (ABS) increased to €100 billion resulting
in Ireland being the second largest centre for this activity in Europe outside of London
37
. The
Irish Stock Exchange passed 1,750 debt approvals and has established an international
reputation for its progressive listing regime. The Irish stock exchange has the capability to
support listing Asset Backed Securities (ABS), Securitised Bonds, Warrants, ECPs and Asset
Covered Securities (ACS).
Aircraft Leasing Ireland has proven a particularly attractive location for aircraft leasing operations as evidenced
by the setup and expansion of a number of large global operations such as Bank of America
Leasing Ireland, AWAS, CIT Aerospace International and Volito Aviation AB. Ireland established
a reputation as a centre for aviation ?nancing expertise in the 1980’s as a result of GPA’s
leading position, which resulted in the development of a deep pool of skilled arrangers,
managers and advisors. The parallel development of the international ?nancial services sector
has provided a further basis for this sector to develop and ?ourish with front and back-of?ce
activities being undertaken here. The Finance Act 2006 also introduced some provisions for
the leasing sector which relaxed restrictions on the use of capital allowances, thus making
Irish based leasing activities more attractive.
?
?
?
?
?
?
34 Federation of International Bankers of Ireland.
35 The Finance Dublin Yearbook, 2007, IBF article.
36 Federation of International Bankers of Ireland, Annual Address, April 2007.
37 The Finance Dublin Yearbook, 2007.
International Financial Services International Financial Services International Financial Services 41
2.4 Ireland – Investment Management Sector
Table 2.11 provides a breakdown of the Net Assets of the European investment fund industry in 2006
(geographical breakdown, UCITS and non-UCITS):
38
Table 2.11 Net assets of the European investment fund industry 2006 by geography
Country Assets €m Percentage
Luxembourg 1,844,850 24.4
France 1,494,400 19.7
Germany 1,017,699 13.4
UK 776,650 10.3
Ireland 717,718 9.5
Italy 383,435 5.1
Spain 287,793 3.8
Other - 13.8
Total - 100%
Source: EFAMA Trends in the European Investment Fund Industry, March 2007.
Table 2.11 shows that Ireland has become an established centre for the European investment funds
industry, accounting for almost 10 percent of net assets. Luxembourg remains the clear market leader with
a 24.4 percent share of funds, followed by France 19.7 percent and Germany 13.4 percent
39
.
As of March 2007, a total of 4,204 funds/sub-funds were registered in Ireland with an additional 3,000
alternative investment funds being serviced from Ireland
40
.
The growth in the value of Irish registered collective investment schemes from 1991 to 2007 is shown in
the table 2.12 below
41
.
38 EFAMA, Trends in the European Investment Fund Industry, March 2007.
39 EFAMA, Trends in the European Investment Fund Industry, March 2007.
40 Irish Funds Industry Annual Newsletter 2007.
41 Irish Funds Industry Annual Newsletter 2007.
International Financial Services 42 International Financial Services International Financial Services
Table 2.12 Net assets of the European investment fund industry 2006 by geography
Year end Total net asset value
(€ million)
Annual % growth
1991 2,506.85 -
1992 4,665.22 86%
1993 11,315.45 143%
1994 13,032.74 15%
1995 18,801.33 44%
1996 25,950.16 38%
1997 43,216.20 67%
1998 70,946.14 64%
1999 149,857.90 111%
2000 208,337.10 39%
2001 284,177.60 36%
2002 303,881.30 7%
2003 361,760.33 19%
2004 434,589.40 20%
2005 584,509.20 35%
2006 729,552.90 25%
Q1 2007 769,145.24 5.4% ytd
Source: IFIA Annual Newsletter 2007.
The value of Irish domiciled funds stood at €769 billion, of which €617 billion were in UCITS structures,
representing an annual growth rate of 25 percent
42
. The funds industry in Ireland is estimated to employ in
excess of 9,000 people with fund operations dispersed across eleven counties.
Irish Funds Industry Association (IFIA) estimates that an additional $600 billion in alternative investments
are serviced from Ireland, resulting in the total value of funds being serviced of €1.3 trillion
43
. Ireland has
?rmly established a reputation as one of Europe’s leading funds centres, capable of competing with more
established hubs and has successfully attracted over 300 of the leading international fund promoters.
2.5 Ireland – Insurance Sector
The international insurance sector in Ireland has shown a steady rate of growth in life and non-life
business. Ireland’s cross border life insurers wrote approximately €15.8 billion in premiums in 2006,
representing an annual increase of 25 percent, making Dublin Europe’s largest cross-border life centre
ahead of Luxembourg and the Isle of Man
44
. Gross premium income for foreign risk non-life business
remained relatively ?at at €3.27 billion in 2006
45
. The numbers employed directly in the international
insurance sector in 2006 were estimated to be 3,027, representing an annual increase of 3 percent when
compared to 2005
46
.
42 Irish Funds Industry Annual Newsletter 2007.
43 Irish Funds Industry Annual Newsletter 2007.
44 The Finance Dublin Yearbook, 2007, Insurance sector overview.
45 Financial Regulator, Insurance Statistical Review, 2006.
46 The Finance Dublin Yearbook, 2007, p.4.
International Financial Services International Financial Services International Financial Services 43
The Irish and UK markets are seen as particularly sophisticated in terms of unit-linked products and the
experience in operating the systems and processes to support these types of products is attractive to
many continental insurance providers. This has resulted in many foreign insurers writing business through
Irish operations.
The reinsurance sector has also experienced strong growth rates recently, spurred by the enactment of the
European reinsurance directive in July 2006, which allowed reinsurance operations to passport between
member states. Ireland was the ?rst EU member to adopt the directive and this has led to recent
investment decisions by companies such as XL Re Ltd to select Dublin as the centre for their European
business. Ireland’s position as a leading centre for securitisation has also provided a boost to the
reinsurance sector where bonds are being issued on the back of insurance securitisation special purpose
vehicles (SPVs).
2.6 Summary
In summary, the international ?nancial services sector is growing on a global basis driven by economic and
demographic trends which are likely to support continued growth in this sector over the medium term. The
international ?nancial services sector in Ireland has been a phenomenal success story over the past 20
years. Ireland has now successfully established itself as an internationally recognised ?nancial centre with
distinctive competencies in the areas of:
Funds servicing;
Debt products and securitisation;
Aircraft Leasing; and
Cross border life insurance.
It is forecast that further expansion is achievable within the international ?nancial services sector, if the
supporting infrastructure e.g. regulatory environment, taxation and cost base remain competitive on an
international basis. However, paramount in underpinning the expected growth in such a knowledge
intensive industry will be the availability of suitably skilled resources.
The following chapter pro?les each sub-sector further and provides details of the key skills and
experience requirements.
?
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?
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International Financial Services 44 International Financial Services International Financial Services
Chapter 3: Review of Irish
Financial Services Skills and
Research Demands
3.0 Introduction
The core research for this chapter was a targeted interview programme with domestic and international
leaders from the international ?nancial services industry. In total 29 interviews were conducted with 44
executives from a selection of leading ?nancial services providers, which covered the areas of banking and
capital markets, investment management and insurance.
The analysis is based on information provided as part of a consultation programme with: Senior
management from ?nancial services companies based in Ireland; Senior management from ?nancial
services companies based in the US and UK; and Industry representative bodies. The interview discussions
with each of these companies covered areas such as:
Investing in Ireland;
Industry trends and drivers of change;
Skills pro?les and resourcing;
Expected future skills requirements;
Research and development; and
Skills and research support structures.
The summary feedback from these interviews is presented in this section under the following headings:
3.1 Investing in Ireland;
3.2 Industry trends;
3.3 Skills demand – industry view;
3.4 Skills pro?le by sector;
3.5 Expected future skills requirements; and
3.6 Supply side dynamics.
?
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?
?
International Financial Services International Financial Services International Financial Services 45
3.1 Investing in Ireland
The international ?nancial services companies interviewed continue to view Ireland as an attractive base to
conduct their ?nancial services activities. Over the past twenty years the regulatory and taxation
environments have provided a solid foundation for businesses to locate here and the experience and
“know-how” associated with the creation of this positive business environment has provided a “knowledge
based” basis for differentiation relative to other ?nancial centres. This has ensured that Ireland has had a
strong offering in terms of its workforce, legal and regulatory environments which reportedly form the key
decision criteria for senior ?nancial services executives (see ?gure below).
Figure 3.1 Decision factors impacting investment decisions
Source: McKinsey- Sustaining New York’s Global Financial Leadership, 2007.
Global Survey of Senior Executives, scored on a 7-point scale.
Availability of Professional Workers
Fair and Predictable Legal Environment
Government and Regulations are Responsive to Business Needs
Attractive Regulatory Environment
Reasonable Compensation Levels to Attract Quality Workers
Favourable Corporate Tax Regime
Availability & Affordability of Technical & Admin Personnel
Deep & Liquid Markets
High Quality Transportation Infrastructure
Effective & Efficient National Security
Openness of Market to Foreign Companies
Reasonable Commercial Real Estate Costs
High Quality of Life (Arts, Culture, Education etc.)
Low All-in Cost to Raise Capital
Close Proximity to Other Markets Customers and Suppliers
Low Health Care Costs
Openness of Immigration Policy for Skilled Workers
Workday Overlaps with Foreign Markets
Senior Executives Consider Workforce, Legal and Regulatory Factors Most Important
Senior Executive Ranking CEO Ranking
1 2 3 4 5 6
High
Medium
Low
International Financial Services 46 International Financial Services International Financial Services
Allied to this, Ireland possesses several “natural” advantages based on our location and culture. Our
location provides a natural bridge in time zones between market centres in Asia and the US. This provides
a strategic advantage which has similarly supported London’s development as an international market
centre. The increasing reliance on technology as an enabler of the sector has created additional emphasis
on our location, as Ireland is ideally located between time-zones in the US and India to form a bridging
point to support 24 hour clock technology development.
These location based advantages coupled with English as a ?rst language and a culture/work ethic which is
closely aligned with US and European values ensures that Ireland has many ?xed advantages when it
comes to competing for mobile investment. Industry representatives interviewed expect that these factors
will continue to provide a platform for the on-going development and expansion of the ?nancial services
sector in Ireland, resulting in increasing levels of employment and demand for skilled resources. The
availability of key staff with specialist skills will be essential if Ireland is to secure investment in high-value
activities going forward – the consultation process con?rmed that many ?rms are making investment and
location decisions based on the availability of a small number of specialists.
However, Ireland’s proposition in ?nancial services has also evolved in the last 20 years, as the economy
has experienced rates of rapid growth. Originally positioned as a “low cost and low tax location”, economic
development has resulted in substantial changes to the Irish cost base. Metropolitan centres such as
Dublin have risen up the international cost base scales, and while our taxation regime still remains
attractive, our ranking as one of the more expensive cities in the world in international studies presents
cost challenges
47
. The cost environment outside of Dublin, however, remains signi?cantly more attractive as
evidenced by the growing numbers of IFS companies locating in the regions.
This change in cost base dynamics has not gone unnoticed by international companies, who now ?nd it
less attractive to base certain administrative and less specialised operational activities in Ireland. Despite
these changes, however, Ireland and particularly locations outside Dublin, still offer some cost advantages
over other ?nancial centres such us Boston, London and New York. However, these cost factors may
continue to present a challenge for Ireland, and therefore, skills based differentiation will take on
renewed importance.
47 Mercer Cost of Living Index 2007 – Ireland ranked 16th most expensive city in the world, up from 18th in 2006.
International Financial Services International Financial Services International Financial Services 47
3.2 Industry Trends
During the course of our consultations with industry representatives a number of trends were articulated
which are expected to impact upon future skills and resourcing strategies. A summary of the key trends is
provided in the table below, with a selection of key drivers of change from an Irish perspective outlined in
further detail.
Table 3.1 Summary of key industry trends
Area Trends
Banking and Capital Markets Operations:
Industry is consolidating towards a smaller number of truly global providers,
and in streamlining their offerings these global providers have relocated
elements of their operations to centralised locations or “centres of ef?ciency”.
Organisations are focusing on technology enabled process innovation to
achieve increased ef?ciencies.
Risk management and regulation are key focus areas.
Ireland has established a reputation for expertise in debt products
and securitisation.
Products:
The product set is relatively stable but pricing mechanisms are becoming
more complex.
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Investment Management Industry Growth:
Strong growth in funds ?ows into Irish listed funds.
Ireland has established a reputation for listing and administration of funds.
Staff:
Some less specialised tasks are being transitioned out of Ireland as they no
longer align with the cost base. This trend is freeing up some capacity to take
on higher value middle-of?ce functions.
Staff turnover is providing a challenge to the cost base and service levels.
Ireland needs more graduates equipped with the skills to operate in front-
of?ce activities. In addition, the education needs to provide more graduates
with specialist skills in emerging areas e.g. derivative structures and
hedge funds.
Products:
Strong growth in the popularity of derivative and hedge fund products has
increased the levels of product complexity which has fed through the value
chain of support functions.
Growth in some front-of?ce operations is being constrained by a lack of
suitably skilled and experienced resources.
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Insurance Sales in pan-European and cross-border life products are increasing.
Ireland is establishing a reputation for capabilities in servicing
pan-European products.
The reinsurance market is showing strong potential for growth.
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International Financial Services 48 International Financial Services International Financial Services
Details of a number of trends which have particular relevance for Ireland and which are already impacting
on the skills requirements of the sector are outlined below:
Industry Consolidation
Consolidation is driving change across all sectors of the ?nancial services industry. However, in the banking
sector in particular, competition to obtain a place as one of the major “global banks” has spurred initiatives
to obtain greater ef?ciencies in operations. This has forced many of the leading organisations to
re-examine their structures to identify areas which can be served more ef?ciently by alternative means or
locations. Failure to engage in this process increases the risk of being acquired by a more ef?cient
competitor who is willing to seek out these ef?ciencies. A number of the organisations interviewed were
actively engaged in a process to review the location of their operational and IT facilities to identify the most
ef?cient locations to support future expansion or relocation of existing operations. India and Singapore
were frequently cited as preferred locations for securing this investment. The availability of appropriately
skilled resources and expertise in technology were cited as key factors in the selection of these locations.
Pace of Product Innovation
All companies across the Financial Services Sector interviewed believed that the pace of innovation in the
industry is increasing and that investment in processes, education and technology innovation will be vital
in maintaining competitive advantage. The main focus of innovation initiatives for the companies
interviewed was product innovation. This was seen as a key element of competition in an industry where
products rapidly become commoditized. In areas where there was a requirement for continuous
innovation, product innovation was incorporated into operational functions.
Efforts to improve process ef?ciency to achieve superior levels of service to support meeting customer
needs were also attracting signi?cant focus among senior managers as the quality of the client
relationships is increasingly viewed as a key differentiator and area of potential competitive advantage.
Finally, at the front-end of customer delivery, changes in web technologies have resulted in new
mechanisms for customers to access and exchange information. This has had the effect of raising customer
expectations for the speed and quality of information delivery, which has driven companies to invest in
technological innovation to ensure that they keep pace with their competitors.
Fund Servicing – Some Servicing Tasks Transitioning
While elements of the fund servicing business are highly specialised, some of the more resource intensive
elements require less specialism, when considered across the ?nancial services skills spectrum. As less
specialised tasks do not align easily with a mid/high cost base, companies have begun to transition some
of these tasks to lower cost centres such as India and Poland. The net effect of this appears to have been
to free-up organisation capacity to undertake “higher value”, more specialised, middle-of?ce tasks, which
are more aligned with the Irish cost base. This rotation of some functions is actively underway and is likely
to strengthen Ireland’s proposition as resources are deployed to support more advanced and complex
products. There will however, be functions that funds, regulated in Ireland, will be required to undertake in
Ireland, to comply with regulatory requirements, and therefore these will not transition from an Irish base.
International Financial Services International Financial Services International Financial Services 49
In tandem with the above trend, there is a move towards increased levels of automation in standard
servicing and reporting tasks. By reducing the level of human intervention required in standard trade
processing and settlement, organisations can achieve greater ef?ciencies and reduced levels of errors. The
use of service-oriented architectures (SOA) is allowing organisations to open elements of their systems
directly to customers to support increased levels of self-service automation. This along with other similar
forms of process innovation will likely change traditional distribution models and the nature of back-of?ce
activities in investment management and funds servicing ?rms from trade execution through to reporting.
Funds Servicing – Higher End Tasks Increasing in Complexity
Recent growth in the popularity of hedge funds, derivatives and alternative investment products has
resulted in signi?cant increases in the complexity of these product offerings. This has had a consequential
impact throughout the value chain, in terms of the resources and systems required to support more
complex product sets. From product development and structuring through to valuations and
administration, increased complexity has increased the requirements for more advanced levels of product
understanding and mathematical modelling capabilities.
International Financial Services 50 International Financial Services International Financial Services
3.3 Skills Demand – Industry View
Due to the scale and diversity of the international ?nancial services sector and the range of functions
undertaken, different challenges, issues, and skills requirements exist for each sub-sector of the industry.
Resource requirements are further in?uenced by whether roles are classi?ed as:
Back-of?ce (operational) e.g. administration, trade processing, reconciliations, settlements, valuations;
Back-of?ce (specialist) e.g. administration/troubleshooting for complex products, ?nancial reporting;
Middle-of?ce e.g. client servicing;
Front-of?ce e.g. investment research and trading decisions;
Support functions (general) e.g. human resources, training, general administration, ?nance; and
Support functions (specialist) e.g. product marketing, PR, IT development, compliance.
Despite this, there was some consistency across the sectors in areas where Irish based companies are
currently experiencing needs or dif?culties in sourcing suitably skilled resources. The eight skills sets noted
on a recurring basis were:
Maths/Economics/Quantitative modelling;
Accountancy (particularly with funds experience);
Risk management;
Compliance;
Middle-Management with ?nancial services experience;
Project and change management;
Funds servicing and back-of?ce banking operations; and
Actuary.
Maths/Economics/Quantitative Modelling
As a result of increasing product complexity, many occupations in IFS now require higher levels of
advanced mathematical capabilities. This has been coupled with an increased focus on risk management
across the industry, to both protect the organisations assets in leveraged environments and to ensure
compliance with international regulations e.g. Basel II. The net effect of this has been an increased level of
demand internationally for advanced mathematical and modelling skills.
In Ireland over recent years, there has been a steady decline in the numbers of students undertaking
science and engineering based subjects, which traditionally provide the greatest source of individuals with
advanced numeric skills. This has exacerbated the shortage in Ireland for this skill set, which is now in high
demand across the entire international ?nancial services sector. It was indicated that suf?cient availability
of resources with these skills will be an essential pre-requisite to the sector in Ireland advancing to higher
value chain/front-of?ce functions.
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International Financial Services International Financial Services International Financial Services 51
Accountants
A number of interviewees highlighted dif?culties in securing “good accountants”. Accountancy
quali?cations were viewed very favourably by the industry as these resources offer a very high degree of
?exibility in terms of the range of roles and areas across banking, investment management and insurance
into which they can be deployed. While signi?cant numbers of business graduates in Ireland currently
pursue an accountancy quali?cation, the perception that quali?ed accountants provide an automatic pool
of numerate individuals who typically possess a good grounding in business principles ensures that
demand for these skills exceeds supply in international ?nancial services. Where accountants also have
quality experience in a relevant ?nancial services area e.g. funds or underwriting, these were particularly
sought after.
Risk Management
Increased emphasis by regulatory authorities over recent years on effective risk management has shifted
the burden of responsibility to ?nancial services ?rms to ensure that they have suitable risk management
procedures and quali?ed personnel in place to protect the assets of the organisation. This has generated
signi?cant growth in demand for specialist risk resources with strong mathematical or audit competencies
that are capable of identifying and managing credit and market risks.
Compliance
As the emphasis placed on the importance of good corporate governance, and the penalties applied for
non-compliance have increased, so too have the expected skills and quali?cations required to ful?l senior
compliance roles. This has contributed to an apparent shortage of suitably quali?ed candidates. As these
roles require a combination of knowledge of the regulatory environment with good judgement and
experience it is dif?cult to achieve signi?cant organic increases in the supply of resources in the short term.
Middle-management
Creating a stable and experienced layer of middle management talent with approximately 5 to 7 years of
relevant ?nancial services experience was cited by several respondents as presenting a challenge. In certain
areas of the ?nancial services sector, in particular funds servicing, factors such as the small pool of labour
with previous funds experience, high attrition levels and the rapid levels of growth in a relatively new
sector has made this more dif?cult to achieve.
It was also suggested that there can be challenges with staff promoted into these roles as this is
sometimes based on experience in speci?c technical skills. This can result in some staff being promoted
into people and process management roles, without necessarily having received the appropriate training or
experience to ensure that they are equipped with the “softer management skills” to operate effectively. If
unaddressed this can result in further staff turnover.
Project/Change Management
The international ?nancial services industry is very dynamic in nature and is constantly changing to adapt
to customer/market demands, regulatory provisions and technological developments. This constant pace
of change is resulting in a stream of discrete implementation projects e.g. Basle II, MiFID. The skill-set to
effectively manage projects is emerging as an increasingly vital competency in order to ensure ef?cient
International Financial Services 52 International Financial Services International Financial Services
management of resources in achieving organisational goals. The resources for these roles require
skills which combine knowledge of project management principles with detailed product and
process understanding.
Back-of?ce (Operational)
Several of the organisations interviewed cited problems in relation to sourcing and retaining back-of?ce
operations staff. Although the minimum competency requirements for many of these roles result in these
being open to a very wide population, most organisations favoured recruiting third level business
graduates, as these were viewed as offering the greatest potential to contribute immediately to operations
and to progress from gateway roles to higher levels within the organisation.
However, attrition levels remain very high for this segment, particularly in the funds servicing sector, and
these levels of turnover pose a signi?cant HR challenge and recruitment cost. Some of the possible reasons
suggested for this attrition included graduates being over quali?ed for the roles, negative peer perceptions
of working in “back-of?ce” functions, the mobile nature of young graduates (70 percent are under 30 years
of age), and the emerging trend to avail of a gap year in the early stages of a career. The key competencies
required for the majority of these roles were described as good levels of numeracy, attention to detail,
ability to work to tight deadlines and communications/interpersonal skills. Finally, it should be noted that
high turnover amongst back-of?ce personnel results in a shortage at supervisory level as there are
insuf?cient staff with extended industry experience.
Actuaries
Actuaries were described as the “engine room” of the insurance sector and play a pivotal role in the high
value roles of product design and pricing. The availability of suitably quali?ed and experienced actuaries
was cited as a constraint. Given the challenging professional quali?cation process for actuaries the supply
of qualifying actuaries is likely to remain constrained which has the potential to limit growth in the product
development area of the insurance sector. Increased emphasis and complexity in pricing, risk modelling
and reporting requirements under Solvency II will ensure that these skills will remain in high demand.
International Financial Services International Financial Services International Financial Services 53
3.4 Skills Pro?les by Sector
Different skills requirements and competencies exist for the different sectors within the international
?nancial services industry. Each sub-sector of the industry is pro?le in this section. However, as outlined
previously, the lines of distinction between the various sub-sectors are converging as providers increasingly
compete across a range of service areas. As a result, the skills requirements highlighted for a particular
sub-sector should not be interpreted as being exclusive to just that particular sub-sector, as overlaps will
increasingly exist between certain sub-sectors.
The following sections provide brief descriptions of each sub-sector in the industry, and where appropriate,
a table detailing the quali?cations, skills and experience required is also provided.
(i) Banking and Capital Markets
High-level summaries of the key value chain activities in the following sub-sectors of banking and capital
markets operations are provided over the following pages:
Structured ?nance;
Securitisation;
Treasury;
Leasing;
Corporate ?nance; and
Investment banking.
Structured Finance
There are numerous different titles applied to the area of commercial/structured ?nance which are largely
determined by the type of assets that a debt is secured against and the methods used to raise the required
funding. In essence though, despite the variety in terminology, the principle activities undertaken as part of
the process and the required skill-sets are broadly the same. The value chain below provides an outline of
the principal activities undertaken by international banks in developing and issuing structured loan
products, through to the support activities required to ensure that the risk is properly managed.
Figure 3.2 Value chain of structured ?nance activities
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Product
Development
Origination Case
Assessment
Credit
Analysis
Underwriting
Deal
Structure
Pricing Funding
Administration
Risk &
Compliance
Medium
Low
High
Level of Activity in Ireland
International Financial Services 54 International Financial Services International Financial Services
In delivering these activities a range of skill-sets is required to support execution. The table below provides
a brief description of some of the key structured ?nance roles that would normally be engaged in
supporting the delivery of the above activities and a list of probable quali?cations, skills and experience
required by individuals to operate effectively.
Table 3.2 Summary of structured ?nance role pro?les
Roles Quali?cations Skills/Requirements Experience
Market research/
Product
development
support
Degree in business/
marketing/accounting
related discipline
? Strong client relationship and
listening skills
Strong analytical and writing skills
?
?
3+ years relevant
?nancial services
Knowledge of
international
markets and trends
?
?
Underwriting Degree in business/
?nance related
discipline
Quali?ed accountant
?
?
Highly numerate
Structured/logical thinker
Problem solver
Excellent communication/
interpersonal skills
Financial/scenario modelling
?
?
?
?
?
Commercial/project
?nance
Structured
corporate credit
products and
markets
?
?
Credit analysis Degree in business
or accounting
related discipline
? Financial analysis techniques
Scenario modelling
Credit analysis and interpretation of
credit ratings
Company research and analysis
Asset quality reviews
?
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?
?
?
3-5 years in a credit
analysis role
?
Pricing
(standard
products)
Degree in business/
accountancy/maths
related discipline
? Strong analytical skills
Credit analysis
Financial Modelling
Scenario modelling
?
?
?
?
2-3 years in risk
management role
Underwriting
experience
?
?
Pricing
(complex
products)
Degree in maths
related subject
Masters level
quali?cation for
senior roles
?
?
Analytical skills
Programming languages (C++, VB,
SQL) or database experience
?
?
Exposure to
?nancial products
or systems
?
Loan
administration
Business quali?cation
(not necessarily to
degree level)
? Numerate
Problem resolution
Attention to detail
Ability to work to deadlines
Interpersonal/communication skills
?
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?
1+ years in
?nancial services
environment
?
Risk
management
Degree in business or
legal discipline or
relevant professional
quali?cation
? Strong analytical skills
Credit analysis
Knowledge of general operational
control environments and ability
to understand and document
systems processes
Report writing and presentation skills
?
?
?
?
5+ year’s relevant
experience in the
area of risk
management or an
audit environment
?
Compliance and
regulatory
reporting
Degree in business,
ideally with a
legal emphasis
Audit experience
?
?
Attention to detail Problem solving
Communications/relationship
management
Generating management reports
?
?
?
Audit/internal
audit experience
?
Note: Research activities identi?ed in value chains relate to product research rather than broader industry based RD&I
activities which are not integral to speci?c value chains and are addressed separately in section 5.
International Financial Services International Financial Services International Financial Services 55
Future Development and Skills Implications
Going forward, to expand Ireland’s presence in this sub-sector, efforts should be made to:
Market Ireland as an international centre for the administration and structuring of innovative debt
based products; and
Develop an internationally recognised distinctive competency in leading-edge risk based pricing and
management techniques.
This will require greater availability of resources with:
Advanced quantitative skills (Maths, Statistics, Engineering) to PhD level that have an understanding of
?nancial instruments and markets;
Financial engineering/Economics skills which incorporate market relevant experience;
International compliance regulations; and
Fluency in European languages.
Additional Initiatives:
Developing an international reputation for excellence in applied academic research in advanced
quantitative ?nance which is accessible by industry.
Securitisation
Securitisation is one of the principle forms of structured ?nance and provides an effective mechanism to
de-link the credit risk of the asset pool from the credit risk of the originator through the use of special
purpose vehicles (SPVs). Ireland’s regulatory and taxation regime have helped to create an environment
which has proven conducive to capitalising on the growth in the securitisation sector. The key elements of
the securitisation process are shown below.
Figure 3.3 Value chain of securitisation activities
A number of service providers have expanded their operations to support the 600+ securitisation vehicles
which have been established in Ireland since 2003. The key functions which are typically performed in
Ireland are mainly accounting and back-of?ce administration for Special Purpose Vehicles (SPVs) with
some amount of structuring and due diligence work being undertaken by professional advisors e.g. legal/
accountancy ?rms.
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Origination
And
Structuring
Setup &
Structuring
of SPV
Due
Diligence
Promotion
& Sales to
Investors
Asset
Selection &
Pooling
Deal
Structure
Administration
And
Servicing
Risk
And
Compliance
Rating
Financial
Reporting
Medium
Low
High
Level of Activity in Ireland
International Financial Services 56 International Financial Services International Financial Services
The table below provides a brief description of some of the key securitisation roles and the quali?cations,
skills and experience typically required to support the delivery of the activities outlined above.
Table 3.3 Summary of structured ?nance role pro?les
Roles Quali?cations Skills/Requirements Experience
Structured
credit analyst
Degree in business/
?nance/accounting or
quantitative discipline
Quali?ed accountant
?
?
Highly numerate
Ability to analyse
legal documents
Knowledge of ratings process
Cash ?ow modelling
?
?
?
?
3-5 years in originating and
structuring securitisation
transactions
Previous experience in
investment banking/law
?rm/ratings agency
?
?
Portfolio
administrator
Degree in business/
?nance/accounting or
quantitative discipline
European languages
?
?
Detailed knowledge of ?nancial
markets and dynamics
Highly numerate
Communication skills to
support liaison with
administrators, ratings agencies
and ?rst loss providers
Negotiation skills
Structured/Logical thinker
Problem solver
Financial/Scenario modelling
?
?
?
?
?
?
?
7+ years in originating and
structuring securitisation
transactions
Previous experience in
investment banking/law
?rm/ratings agency
?
?
Legal and tax
specialists
Degree in business
or law
Relevant professional
quali?cations
e.g. tax exams
European languages
?
?
?
Knowledge of ?nancial markets
and instruments
Company formation, listing and
preparation of legal documents
European regulations
and taxation
Interpersonal/
Communication skills
?
?
?
?
3 years PQE in ?nancial
services environment
?
SPV accountant Degree in business/
accounting related
discipline
Quali?ed accountant
?
?
Strong analytical skills
Knowledge of ?nancial markets
and ?nancial reporting systems
Financial Modelling
Advanced Excel
?
?
?
?
2-3 years in
?nancial services
?
Pricing
administrator
Degree in accounting/
?nance or economics
? Numerate
Attention to detail
Problem resolution
News services e.g. Reuters
?
?
?
?
2+years in pricing/
valuations role
?
General
administration
Business or accounting
related quali?cation
(not necessarily to
degree level)
? Numerate
Problem resolution
Attention to detail
Ability to work to deadlines
Interpersonal/
Communication skills
?
?
?
?
?
1+ years in
?nancial services
?
International Financial Services International Financial Services International Financial Services 57
Future Development and Skills Implications
Going forward, it is unlikely that Ireland can obtain a signi?cant proportion of origination or structuring
activities as these are typically undertaken in international market centres e.g. London, Hong Kong.
Therefore, ensuring that the infrastructure to support back-of?ce activities remains internationally
competitive is likely to present the greatest opportunities to take advantage of the continued industry
growth in this sub-sector.
Maintaining competitiveness will require a greater availability of resources with:
Professional legal and tax quali?cations;
Business/Finance quali?cations which incorporate detailed elements on debt products and markets;
Client servicing;
Fluency in European languages; and
Credit analysis skills.
Treasury
Treasury services are mainly provided by the larger banks who will also provide solutions on a third party
basis to customers who may not require a full treasury function or to those wishing to outsource
aspects of it. A range of treasury products and services are used to manage the impact of volatile market
movements in exchange rates, interest rates, in?ation or commodity costs on a business’s cash ?ow.
The speci?c value chain of activities will be determined by the nature of the transaction e.g. corporate,
institutional, trade ?nance. The chart below provides a very high-level summary of the functions involved.
Figure 3.4 Value chain of treasury activities
The table below provides a brief description of some of the key roles that would generally be required to
support treasury operations. The breakdown of roles required would be further determined by the kind of
treasury activities being undertaken e.g. banking or corporate.
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?
?
?
Identify
Funding
Need
Source/
Place
Funds
Evaluation
of Options
& Returns
Trade Execution
and Deal
Confirmation
Administration
& Reporting
Medium
Low
High
Level of Activity in Ireland
International Financial Services 58 International Financial Services International Financial Services
Table 3.4 Summary of structured ?nance role pro?les
Roles Quali?cations Skills/Requirements Experience
Treasury
manager
Degree in
business/?nance
Quali?ed accountant
MBA
?
?
?
Detailed understanding of ?nancial
markets and instruments
Highly numerate
Sales skills
Interpersonal skills
Financial risk assessment
Financial analysis
?
?
?
?
?
?
7+ years experience
in corporate
treasury
Treasury systems
?
?
Treasury analyst Part/fully quali?ed
accountant with
2+ years treasury
experience
? Highly numerate
Financial analysis
Interpersonal skills
Problem solving
Report writing
?
?
?
?
?
Knowledge of
FX and interest
rate markets
Cash ?ow
forecasting
?
?
Treasury dealer Masters in Maths/
Economics/Finance
Chartered Financial
Analyst (CFA)
?
?
Client/relationship management
Extensive knowledge of international
?nancial markets
Strong mathematical and
analytical skills
Bloomberg/Reuters
?
?
?
?
5+ years in
investment
analysis/dealing
support
?
Treasury dealer
(corporate)
Degree in business/
?nance related
discipline
? Sales skills
Interpersonal skills
Financial risk assessment
Financial accounts interpretation
?
?
?
?
3 years experience
in a treasury
environment or
dealing desk
?
Treasury MIS General business
quali?cation
? Numerate
Report writing and presentation skills
?
?
Valuations or
reporting role
?
Credit risk
analyst
Business/?nance/
quantitative degree
Masters in a ?nance
quali?cation
?
?
Research and analytical skills
Ability to interpret ?nancial data
Report writing
Interpersonal skills
?
?
?
?
Risk analysis ?
Market risk
analyst
Degree in maths
related subject or
quantitative ?nance
? Analytical skills
Programming languages
(C++, VB, SQL) or database experience
?
?
Risk management
functions
Financial markets
and instruments
Exposure to
?nancial systems
?
?
?
Treasury
Accountant
Business/?nance
degree
Quali?ed accountant
?
?
Analytical approach to problem solving
Highly numerate
Financial analysis
Knowledge of capital markets and
?nancial instruments
Presentation skills
?
?
?
?
?
2+ years in a
?nancial services or
treasury
environment
?
Customer
Services
General business
graduate (not
necessarily to
degree level)
European Languages
?
?
Relationship Management
Problem resolution
Numerate
Attention to detail
Ability to work to deadlines
Communication skills
?
?
?
?
?
?
Experience
of customer services
or administrative
function in relevant
?nancial services
area
?
International Financial Services International Financial Services International Financial Services 59
Future Development and Skills Implications
Going forward, expansion of Ireland’s position as a leading provider of treasury functions will require
sustained efforts to ensure that the environmental factors which have underpinned the establishment
of multinational corporate treasury functions in Ireland remain. In particular, measures to ensure a
suf?cient supply of skilled front-of?ce resources to limit labour cost in?ation will be vital in maintaining
international competitiveness.
This will require greater availability of resources with:
Accountancy quali?cations;
Specialist postgraduate quali?cations in treasury;
Advanced quantitative skills (Maths, Statistics) with an understanding of ?nancial instruments and
markets; and
European languages.
Leasing
The leasing sector, in contrast to some of the other sub-sectors within banking and capital markets appears
to place a greater emphasis on relevant industry experience gained whilst operating within the sector e.g.
aviation leasing, ahead of academic or professional quali?cations. The following high-level diagram
provides a summary of the key functional areas typically required to support asset-leasing operations.
Figure 3.5 Value chain of leasing activities
Given the importance of relevant experience in this sub-sector, leasing roles typically require longer periods
of prior service and exposure to the sector. The table below provides a brief description of some of the
general leasing roles, however, in circumstances where increased levels of responsibility attach to a role,
greater periods of previous industry experience would likely be required.
?
?
?
?
Marketing
and
Origination
Pricing/
Bid
Contracts
Secondary
Market Sales
& Analysis
Management
of Credit
Issues
Purchase,
Renew, Return
of Assets
Maturities
Funding &
Invoice
Review
Booking
Medium
Low
High
Fair market
Value
Research
Level of Activity in Ireland
International Financial Services 60 International Financial Services International Financial Services
Table 3.5 Summary of leasing role pro?les
Roles Quali?cations Skills/Requirements Experience
Marketing Degree quali?ed
in business/
marketing area
European languages
?
?
Understanding of standard
lease terms and language
Ability to identify and interpret
technical requirements
Contract negotiation skills
Interpersonal and relationship
management skills
?
?
?
?
2+ years relevant
sector experience
?
Portfolio
management
Degree quali?ed in a
relevant business/
accountancy discipline
MBA
?
?
Financial analysis
Funding options
and implications
Highly numerate
Communications and
interpersonal skills
?
?
?
?
5+ years in commercial
?nance/leasing
Knowledge of
Aerospace ?nance
?
?
Credit analyst Degree quali?ed in
business or accounting
related discipline
? Financial analysis techniques
Scenario modelling
Credit analysis and
interpretation of credit ratings
Company research and analysis
Asset quality reviews
?
?
?
?
?
3-5 years in a credit
analysis role
?
Financial control Quali?ed accountant ? Financial analysis
Highly numerate
Attention to detail
Good interpersonal skills
?
?
?
?
3-5+ years in ?nancial
reporting role
Previous audit
experience
IFRS accounting
standards
?
?
?
Legal services Degree in Law/
International law
? Analytical skills
Interpersonal/
Communication skills
Report writing
?
?
?
Negotiating and
documenting high
value international
contracts
?
Future Development and Skills Implications
Ireland has established a signi?cant presence in the leasing market, but as in most areas of international
?nancial services, intense competition exists from other countries who are seeking to grow their economy
and the proportion of high value services jobs. Measures to expand Ireland’s international presence in this
sub-sector should:
Ensure that the existing tax, legal and regulatory provisions which have led to the development of our
leading position are maintained; and
Support developing deep industry experience which is a key differentiator in this sector.
To achieve the objectives above will require greater availability of resources with:
Relevant experience in aviation leasing. Given that signi?cant increases in the native population with
these resources cannot be achieved in the short term, measures to attract high skilled migrants (such
as the recently introduced Green Card system) are of vital importance;
Quali?ed accountants with credit analysis and corporate ?nance skills;
?
?
?
?
International Financial Services International Financial Services International Financial Services 61
International tax skills; and
International legal skills.
Corporate Finance and Investment Banking
Investment banking is the term typically used to describe corporate ?nance advisory, sell and buy side
brokerage and capital markets fund raising activities. The term corporate ?nance encapsulates a wide range
of corporate activities including:
Mergers;
Acquisitions;
Disposals;
Fund raising; and
Valuations.
As the value chain of activities is entirely dependent on the desired outcome e.g. merger/sale it is not
practical to outline a standard value chain of activities. However, the resources and associated skill-sets that
typically perform these activities remain relatively constant and these are outlined in the table below:
Table 3.6 Summary of leasing role pro?les
Roles Quali?cations Skills/Requirements Experience
Accountants Degree quali?ed in a
business/?nance/
economics discipline
Quali?ed accountant
?
?
Strong client
relationship and
listening skills
Financial modelling
Strong analytical and
writing skills
?
?
?
3+ years relevant
?nancial services
Corporate ?nance/
credit structures
Knowledge of international
markets and trends
?
?
?
Legal advisor Degree in business or
legal discipline
Quali?ed solicitor
?
?
Analytical skills
Interpersonal/
Communication skills
Report writing
?
?
?
3+ years PQE in an advisory
role, preferably in a ?nancial
services environment
?
Taxation specialist Degree quali?ed in a
business/?nance/
legal discipline
Professional
tax quali?cation
Quali?ed accountant
?
?
?
Analytical skills
Interpersonal/
Communication skills
Report writing
?
?
?
3+ years relevant
?nancial services
Knowledge of international
tax regulations
?
?
Sector specialists Degree in relevant topic
Industry relevant/
professional
quali?cations
?
?
Analytical skills
Interpersonal/
Communication skills
Report writing
Consulting skills
?
?
?
?
5-10 years sector
relevant experience
?
?
?
?
?
?
?
?
International Financial Services 62 International Financial Services International Financial Services
The remaining investment banking activities relate to brokerage and capital market activities. This involves
trading debt, equities, ?xed income, funds, foreign exchange, commodity and derivative instruments. There
is a high degree of convergence between these activities and those of investment management sector, and
as a result the required skill-sets are similar.
Trading functions are typically divided into three categories:
Front-of?ce (contact with customers and market makers);
Middle-of?ce (client servicing and control functions); and
Back-of?ce (processing and reporting functions).
The diagram below provides a high-level view of the value chain of activities required to support
investment banking trading activities.
Figure 3.6 Value chain of investment banking activities
The quali?cations, skills and experience required to support trading operations are covered in detail in the
next section on investment management.
?
?
?
Research &
Product
Recommendations
Sales to
Institutional &
HNW Clients
Pricing &
Execution
of Trade
Data
Checking
Transaction
Processing
Orders
Transmitted
Financial
Reporting
Risk
Management
Client
Servicing
Medium
Low
High
Front-Office Middle-Office Back-Office
Level of Activity in Ireland
International Financial Services International Financial Services International Financial Services 63
(ii) Investment Management
The investment management sector has been split into two sections, namely:
Investment management; and
Funds servicing.
Separate diagrams summarising the high-level value chain of activities required to support front-of?ce and
back-of?ce trading operations are shown below.
Figure 3.7 Value chain of investment management activities (front-of?ce)
Figure 3.8 Value chain administration/servicing activities (back-of?ce)
The tables that follow provide additional details on the quali?cations, skills and experience requirements
typically required to support investment management and servicing functions. Again these have been
shown separately, however, depending on the operational structure and classi?cation, there may be some
overlapping elements.
?
?
Product
R&D
Fund
Registration
Fund
Launch
Investment
Decisions
Portfolio
Management
Fund
Promotion
Portfolio
Modelling
Create &
Publish
Prospectus
Trade
Execution &
Reporting
Fund
Distribution
Medium
Low
Level of Activity In Ireland
Settlements Corporate
Actions
Cash
Management
Fund
Accounting
Performance
Management
Custody Valuations Maintain
Data and
Records
Audit
Client
Servicing
Reporting
Medium
Low
High
Level of Activity in Ireland
International Financial Services 64 International Financial Services International Financial Services
Investment Management
The investment management sector is a crucial element in the long-term drive to move IFS in Ireland
towards higher value functions. The employment pro?le in this sector features substantial numbers of
well-paid, knowledge intensive roles, based primarily on high-level quantitative and mathematical skills.
Ensuring a suf?cient supply of such skills is vital in order to attract further investments into Ireland from
this sector. Furthermore, a supply of personnel with other internationally recognised quali?cations (such as
the Chartered Financial Analyst quali?cation) is also a pre-requisite for continued growth. Front-of?ce
investment management roles are typically classi?ed as “high value” as they require advanced skills and
experience. Front-of?ce roles have an employment multiplier effect, requiring approximately three support
staff for each front-of?ce role. London would have been the traditional location for the majority of these
roles, but Ireland has begun to develop a growing presence in this sector with a number of key operators
locating operations in Dublin. The table below provides a brief description of the key investment
management roles.
Table 3.7 Summary of investment management role pro?les
Roles Quali?cations Skills/Requirements Experience
Market research and
product development
support
Degree in business/
economics/marketing
? Strong analytical and
writing skills
Statistical analysis
Advanced Excel
Use of news services
Bloomberg/Reuters
?
?
?
?
?
3+ years relevant
?nancial services
Knowledge of
international markets
and trends
?
?
Product R&D –
quant analyst
Degree/Masters/PhD in
maths or statistics
Chartered ?nancial
analyst (CFA)
?
?
Statistical packages
e.g. SAS
Programming
languages
(e.g. C++, VB)
Communications skills
Interpersonal skills
?
?
?
?
Relevant ?nancial
services experience
?
Product R&D –
quant developer
Degree/Masters/PhD in
maths or statistics
? Programming
languages
(e.g. C++, VB)
Communications skills
Interpersonal skills
?
?
?
Relevant ?nancial
services experience
?
Quantitative analyst Degree/Masters/PhD in
maths or statistics
? Statistical packages
e.g. SAS
Programming
languages
(e.g. C++, VB)
Communications skills
Interpersonal skills
?
?
?
?
Relevant ?nancial
services experience
?
Equity analysis Masters in business/
economics/?nance
Degree in accounting or
audit related
Chartered ?nancial
analyst (CFA)
?
?
?
Communications skills
Presentation skills
Report writing
Organisation and
planning
Excel
?
?
?
?
?
2-5 years in
Equity research
Sector relevant
experience
?
?
International Financial Services International Financial Services International Financial Services 65
Roles Quali?cations Skills/Requirements Experience
Portfolio management Masters in economics/
?nance
Chartered ?nancial
analyst (CFA)
?
?
Client/Relationship
management
Extensive knowledge of
international ?nancial
markets
Strong mathematical
and analytical skills
People management
News Services
Bloomberg/Reuters
?
?
?
?
?
?
10+ years in investment
analysis/portfolio
management
?
Sales and distribution Business degree ? Client/Relationship
management
Extensive knowledge of
international ?nancial
products markets
International languages
International regulatory
systems
?
?
?
?
Relevant ?nancial
services experience
?
Investment decision
support/research analyst
Masters in business/
economics/?nance
Degree in accounting or
audit related
Chartered Financial
Analyst (CFA)
?
?
?
Communications skills
Presentation skills
Report writing
Organisation and
Planning
Excel
?
?
?
?
?
2-5 years in Equity
research
Sector relevant
experience
?
?
Trade execution Degree in business/
Economics/Finance
? Attention to detail
Communication
Interpersonal skills
Negotiation skills
Bloomberg/Reuters and
trading systems
?
?
?
?
?
Knowledge of the Fund
management industry
5+ years trading
experience
?
?
Pricing Business/Finance
Degree
? Strong mathematical
background
Knowledge of
securities classes
Stock reconciliations
Access/Excel
News services
Bloomberg/Reuters
?
?
?
?
?
?
2-3 years
relevant experience
Corporate actions
?
?
Risk Management Degree in Maths
related subject
Masters level
quali?cation for
senior roles
?
?
Analytical skills
Programming
languages (e.g. C++,
VB, SQL) or database
experience
?
?
Exposure to ?nancial
products or systems
?
Trade Administration Degree level education
only required for
certain areas
? Attention to detail
Problem solving
Communications/
Relationship
management
Generating
management reports
?
?
?
?
Trade settlements/
client services
?
International Financial Services 66 International Financial Services International Financial Services
Roles Quali?cations Skills/Requirements Experience
Settlements General business
graduate (not
necessarily to
degree level)
Specialist Cert
in Investment
Fund Services
?
?
Numerate
Problem resolution
Attention to detail
Ability to work to
deadlines
Interpersonal/
Communication skills
?
?
?
?
?
Crest/Euroclear
experience
Other fund admin
process areas
?
?
Compliance Degree in legal
or business and
legal discipline
? Attention to detail
Problem solving
Communications/
Relationship
management
Generating
management reports
?
?
?
?
Audit/Internal
audit experience
?
Legal support Quali?ed Solicitor/
Barrister with
1-3 years experience
? Strong analytical and
writing skills
Communications skills
Attention to detail
Planning and
organisation
?
?
?
?
Financial services/
Funds experience
Company secretarial
services
?
?
Risk Management Degree in Maths
related subject
Masters level
quali?cation for
senior roles
?
?
Analytical skills
Programming
languages (C++, VB,
SQL) or database
experience
?
?
Exposure to ?nancial
products or systems
?
Performance Management/
Financial Statements
Quali?ed accountant ? IFRS/GAAP standards ? Investment
Management industry
?
Credit Analyst BSc in Statistics/
Applied Maths or
Masters in Economics
? Excellent
analytical skills
? Relevant ?nancial
services experience
?
Future Development and Skills Implications
Going forward, to expand Ireland’s presence in this sub-sector, efforts should be made to:
Foster and grow the high-value front-of?ce operations which are involved in portfolio construction;
Expand expertise in passive fund management; and
Position Ireland as a support centre for the international distribution of products providing marketing
and compliance services.
This will require greater availability of resources with:
International investment management experience. This sector is heavily dependent on experts with
international experience can make the transition into senior roles (these are not available in suf?cient
volumes locally in the short term). It is important, therefore that measure which facilitate the
?
?
?
?
International Financial Services International Financial Services International Financial Services 67
movement of skilled workers from overseas (such as the Green Card system) work as ef?ciently and
effectively as possible;
Advanced quantitative skills (Maths, Statistics, Engineering) to PhD level that have an understanding of
?nancial instruments and markets;
Quantitative ?nance/Economics skills which incorporate market relevant experience;
Advanced knowledge of specialist ?nancial products e.g. derivatives and hedge funds; and
IT/Software engineering and business analysis skills to support the development of automated
trading platforms.
Additional Initiatives:
Placements in investment management ?rms, either domestically or internationally, should be
incorporated into relevant courses to increase graduates exposure to this sector and to improve their
experience base.
Funds Servicing
The funds servicing sector has developed into a vital element of the international ?nancial services sector
in Ireland. Operations within this area are typically resource intensive, and as a result, funds servicing
activities represent the vast majority of jobs within the investment management sector in Ireland. The
quali?cations, skills and experience required for the many of these roles are relatively homogeneous, with
certain resources being interchangeable between functions given the requisite on-the-job training. The
table below provides a brief description of some of the key funds servicing roles and the typical
quali?cations, skills and experience required to support the delivery of these activities.
Table 3.8 Summary of funds servicing role pro?les
Roles Quali?cations Skills/Requirements Experience
Trade Processing General business
graduate (not
necessarily to
degree level)
Specialist Cert in
Investment Fund
Services
?
?
Numerate
Attention to detail
Ability to work to deadlines
?
?
?
Fund Valuations General business
graduate (not
necessarily to
degree level)
Specialist Cert
in Investment
Fund Services
?
?
Numerate
Accounting knowledge
Accuracy and Attention to
detail
?
?
?
NAV calculations ?
Settlements General business
graduate (not
necessarily to
degree level)
Specialist Cert
in Investment
Fund Services
?
?
Numerate
Problem resolution
Attention to detail
Ability to work to deadlines
Interpersonal/
Communication skills
?
?
?
?
?
Crest/Euroclear
experience
Other fund admin
process areas
?
?
?
?
?
?
?
International Financial Services 68 International Financial Services International Financial Services
Roles Quali?cations Skills/Requirements Experience
Maintain data and
records Cash
Management
Custody
General business
graduate (not
necessarily to
degree level)
Specialist Cert
in Investment
Fund Services
?
?
Numerate
Problem resolution
Attention to detail
Ability to work to deadlines
Interpersonal/
Communication skills
?
?
?
?
?
Corporate Actions General business
graduate (not
necessarily to
degree level)
Specialist Cert
in Investment
Fund Services
?
?
Understanding of
corporate actions theory,
process and impact
Numerate
Attention to detail
Communication skills
?
?
?
?
Experience of trade
?ows and the impact
of failing trades on
the corporate
actions process
?
Client Servicing General business
graduate (not
necessarily to
degree level)
European Languages
Specialist Cert
in Investment
Fund Services
?
?
?
Relationship Management
Problem resolution
Numerate
Attention to detail
Ability to work to deadlines
Interpersonal skills
Communication skills
?
?
?
?
?
?
?
Extensive experience
in a range of Fund
admin areas and
detailed understanding
of processes
?
Financial Reporting Quali?ed/part-
quali?ed accountant
General business
graduate
Specialist Cert
in Investment
Fund Services
?
?
?
Numerate
Problem resolution
Attention to detail
Ability to work to deadlines
Interpersonal skills
Communication skills
?
?
?
?
?
?
Exposure to reporting
functions in the funds
industry
?
Fund Accounting Quali?ed accountant ? Numerate
Problem resolution
Attention to detail
Ability to work to deadlines
Interpersonal skills
Communication skills
?
?
?
?
?
?
NAV calculations
Management reporting
?
Performance
Management/
Financial
Statements
Quali?ed accountant ? IFRS/GAAP standards ? Exposure to
reporting functions in
the funds industry
?
Audit Quali?ed accountant ? IFRS/GAAP standards
Problem solving
Analytical thinking
Interpersonal skills
?
?
?
?
Funds industry/
Financial services
?
International Financial Services International Financial Services International Financial Services 69
Future Development and Skills Implications
Over the medium term the funds servicing sector is likely to remain one of the key drivers of
employment growth in the international ?nancial services sector. To secure the expected expansion in
employment in this sub-sector the following initiatives should be considered to ensure a competitive
proposition is maintained:
Expand the proportion of middle-of?ce and high value client servicing functions;
Develop leading-edge solutions to support increased automation e.g. straight through processing; and
Expand the pool of available skilled resources by targeting alternative populations to create additional
capacity and reduce attrition levels.
This will require greater availability of resources with:
Business/Finance quali?cations which incorporate detailed elements on funds and complex products
e.g. derivatives;
Accountancy skills with funds experience;
Certi?cates in funds servicing;
Client servicing and international customer service skills;
European languages;
Middle-management experience; and
Business and systems analysis skills to support process automation initiatives.
Additional Initiatives:
Promotion of employment opportunities in this sector to alternative populations e.g. school leavers,
parents returning to the workforce, migrants working in other sectors etc. to increase the available
labour supply and reduce turnover levels; and
Improved career guidance initiatives and work placement programmes for graduates to provide greater
exposure to the sector, the key activities conducted and the employment opportunities available.
?
?
?
?
?
?
?
?
?
?
?
?
International Financial Services 70 International Financial Services International Financial Services
(iii) Insurance
Insurance – Life
The following high-level diagram provides a summary of the key functional areas typically required to
support international insurance operations.
Figure 3.9 Value chain of life insurance activities (front-of?ce)
The table below provides a brief description of some of the quali?cations, skills and experience required
for key international life insurance roles.
Table 3.9 Summary of life insurance role pro?les
Roles Quali?cations Skills/Requirements Experience
Actuary Quali?ed actuary with
experience of Life
products/environment
? Understanding of key
principles of ?nancial
reporting and
accounting standards
Risk management
methods
Knowledge of available
product sets
Strong attention
to detail
Audit mentality
Strong Excel/
Modelling skills
?
?
?
?
?
?
Life and pensions
products and
markets experience
?
Sales Support Admin Completed a
post-Leaving
Certi?cate course
Completed relevant
QFA modules
?
?
Good computer skills
Attention to detail
?
?
Will have 0–12 months
industry experience
?
Product
Development
Sales &
Origination
Assessment
And
Underwriting
Collections Investment
Management
Policy
Administration
Risk &
Compliance
Marketing Policy
Issue
Claims
Management
Financial
Reporting
Medium
Low
High
Level of Activity in Ireland
International Financial Services International Financial Services International Financial Services 71
Roles Quali?cations Skills/Requirements Experience
Underwriter Business or ?nance
related quali?cation
Underwriting diploma,
BLIA or ACII
?
?
Understand principles
of Life, Disability and
Critical Illness insurance
and Pensions
Detailed product
knowledge and
qualifying criteria
?
?
3-4 years underwriting
or administration
experience
?
Administration, Life Claims,
Administrator,
New Business
Completed Leaving Cert
or equivalent and may
have completed post-
Leaving Cert course
Working towards
relevant QFA modules
?
?
Knowledge of Life
products and will
know product range
and distinguishing
features of each
Understanding of basic
principles of Life
Assurance
Telephone skills
Computer skills
?
?
?
?
1-2 years in life
administration
?
Customer Services
Representative
Leaving Cert or
equivalent and may
have completed a post-
Leaving Cert course
Preferably will have an
industry quali?cation
?
?
Communication skills –
verbal and
interpersonal
? Experience within the
industry commensurate
with level
?
Risk and Compliance Degree in legal or
business discipline
Likely to be pursuing
other industry
quali?cations, such as
IIPM, AITI
?
?
Knowledge of life and
pensions industry
regulatory environment,
in particular IFSRA
compliance
requirements
Detailed knowledge of
the product range and
sales process
Principles of sampling
and quality assurance
Procedure writing
?
?
?
?
At least 5 years
experience in Life and
Pensions industry
Exposure to an internal
audit environment
Strong understanding
of business
Working knowledge of
the key applicable
pieces of legislation
?
?
?
?
Financial Reporting
Accountant
Quali?ed Accountant ? Knowledge of IFRS
reporting standards
Experience of
Sarbanes-Oxley
Report writing and
presentation skills
High levels of numeracy
and attention to detail
Interpersonal skills
?
?
?
?
?
2+ years in ?nancial
control/reporting
Financial services
experience
?
?
General Manager Quali?ed Accountant
or Actuary
? Extensive knowledge of
the insurance sector
and the impact of
decisions on
concentration of risk
Knowledge of
regulatory reporting
obligations
Interpersonal/
Communication skills
?
?
?
10+ years experience
in an insurance
environment
?
International Financial Services 72 International Financial Services International Financial Services
Future Development and Skills Implications
The international life insurance sector appears poised for continued growth over the medium term. Life
operations based in Ireland generally involve smaller volumes of resources who are engaged in supporting
management and reporting functions. Sales activities are based in the respective local markets and this is
likely to always be the case so expansion into these elements of the value chain is not feasible.
Continuing to meet the growth demands of this sector will require a supply of resources with:
Actuarial and risk assessment skills;
Accountancy quali?cations; and
Business administration skills.
General Insurance
The value chain and role descriptions for general insurance are broadly similar to those shown previously
for Life insurance. The table below provides a brief description of the key quali?cations, skills and
experience required for the key general insurance roles.
Table 3.10 Summary of general insurance role pro?les
Roles Quali?cations Skills/Requirements Experience
Actuary Quali?ed Actuary with
experience of general
insurance environment
? Understanding of the key principles
of ?nancial reporting and
accounting standards
Strong attention to detail
Audit mentality
Strong Excel/Financial modelling skills
?
?
?
?
General insurance
experience
?
Customer
Sales
Advisor
Leaving Cert or
equivalent and may
have completed a post-
Leaving Cert course
? Understanding of basic principles
of insurance, basic covers, package
rating, and basic acceptance criteria
of packages
Customer focused with good
interpersonal skills
Ability to work to deadlines
Sales skills
?
?
?
?
1-2 years sales or
customer service
experience
?
Underwriter
– Private
Lines/
Commercial
Lines
Business or ?nance
related quali?cation
Advancing towards
an insurance
related quali?cation
?
?
Broad/Extensive knowledge of relevant
products, policy wordings, clauses
and exclusions
Understands what drives risk and has
the ability to identify and select
complex risks and interpret
information effectively
Aware of impact of assessing and
writing risk
Aware of trends in the marketplace
Knowledge of competitor’s products
and awareness of the general market
and
Working relationship with sales team
and broker networks and schemes
?
?
?
?
?
?
Minimum of
2-3 years experience
?
?
?
?
International Financial Services International Financial Services International Financial Services 73
Roles Quali?cations Skills/Requirements Experience
Underwriter
– Product
Specialist
Business or ?nance
related quali?cation
Advancing towards an
insurance related
quali?cation
Specialist knowledge
and company
speci?c courses
?
?
?
In-depth knowledge of products in
area of specialism and will be a
technical reference point on that area
Corporate rating skills
Knowledge of speci?c product rating
methodologies and company speci?c
treaties, coinsurance arrangements
and specialist insurance counterparts
Knowledge of economic trends on
assessing and writing risk
Industry sector specialist, with an in-
depth knowledge of a particular sector,
e.g. property, liability, motor, etc.
?
?
?
?
?
At least 8 years
underwriting
experience
?
Risk Control
Surveyor
Degree in
related discipline
Insurance related
quali?cation and/or
may be certi?ed in
relevant area, such as,
Health and Safety,
environmental
certi?cation, etc.
?
?
Knowledge of underwriting and
claims processes
? Broad industrial base in
respect of knowledge
and experience of
industrial processes,
working practices and
current legislation
?
Claims
Specialist
Degree in business or
legal discipline
Relevant insurance
quali?cations
?
?
Understanding of principles of
legal liability
Knowledge of investigating liability,
property and personal injury claims
Extensive knowledge of claims and the
legal process
Knowledge of processing liability and
personal injury claims
?
?
?
?
At least 10-12 years
experience in claims
settlements
?
Fraudulent
Claims
Specialist
ACII quali?cation or
made substantial
progress towards
its attainment
? Technical knowledge of claims and
underwriting including basis for
repudiation of claims
Knowledge of civil and criminal law as
related to insurance along with a
working knowledge of insurance
claims practices and procedures
Detailed understanding of the
insurance market, ?nance, and
regulatory environment
?
?
?
5 years of claims
experience with some
experience in fraud
investigations
?
Risk
Manager
Degree in business or
legal discipline or
relevant professional
quali?cation
? Knowledge of developing regulations
in Ireland and Europe
Knowledge of general operational
control environments and ability
to understand and document
systems processes
Excellent report writing and
presentation skills
Cross-functional awareness
and appreciation
Awareness of the overall compliance
to Health and Safety, IT Security and
all legislation/compliance in
appropriate functions
?
?
?
?
?
5+ year’s relevant
experience in the area
of risk management or
audit environment
?
International Financial Services 74 International Financial Services International Financial Services
Roles Quali?cations Skills/Requirements Experience
Compliance
Of?cer/
Manager
Degree in business or
legal discipline
? Knowledge of life and
pensions industry regulatory
environment, in particular IFSRA
compliance requirements
Detailed knowledge of the product
range and sales process
Principles of sampling and
quality assurance
Procedure writing
Strong written and verbal
communication skills
Capable of motivating others towards
delivering key compliance objectives
across the organisation
?
?
?
?
?
?
Exposure to an internal
audit environment
Strong understanding
of business
Working knowledge of
the key applicable
pieces of legislation
?
?
?
In-house
Legal
Advisor
Quali?ed solicitor ? Understand insurance company
commercial dynamics and ?nancials
e.g. KPI’s etc.
Knowledge of ?nancial services
environment
Principles of risk management,
controller and compliance,
particularly as they relate to the
regulatory environment and brokers
customer services
?
?
?
Will probably have
3-5 years experience
within the industry
?
Future Development and Skills Implications
The international general insurance market has yet to develop to any signi?cant scale, as outside of
reinsurance of general insurance products, which is conducted on an international basis, the underwriting
of general insurance risk is largely performed on a local market basis. Many general insurance ?rms have
the capability to support pan-European products, however, the market preference appears to be towards
local operations based in each market. Therefore, no speci?c skills or resource requirements have been
identi?ed for this sub-sector at this time.
International Financial Services International Financial Services International Financial Services 75
Reinsurance
The following high-level diagram provides a summary of the value chain of activities generally required in
reinsurance operations.
Figure 3.10 Value chain of reinsurance activities
The roles required to support reinsurance operations are broadly similar to those for life insurance,
however, there are increased levels of complexity associated with underwriting and risk management tasks,
so resources with greater levels of experience would be required to support these roles.
Captive Insurance
The following high-level diagram provides a summary of the key functional areas typically involved in
captive insurance operations. Captive insurers typically outsource functional operations to dedicated
captive administrators who perform the main underwriting, administration and reporting functions.
Figure 3.11 Value chain of captive insurance activities
Marketing Assessment
And
Underwriting
Collections Investment
Management
Policy
Administration
Risk &
Compliance
Policy
Issue
Claims
Management
Financial
Reporting
Medium
Low
High
Level of Activity in Ireland
Risk
Assessment
SPV Captive
Setup
Captive
Administration
Captive
Certification
Risk &
Compliance
Reporting
Medium
Low
High
Level of Activity in Ireland
Parent Company
International Financial Services 76 International Financial Services International Financial Services
The roles required to support captive administrators are similar to those for general insurance and
therefore are not described separately. The only substantial point of differentiation is that consulting
actuaries are typically used to perform captive certi?cations, and these typically have higher levels of client
relationship/communication skills relative to in-house actuaries.
Future Development and Skills Implications
Going forward, to expand Ireland’s presence in insurance sub-sectors, efforts should be made to:
Continue to support the growth in cross-border life sales; and
Capitalise on regulatory changes in the reinsurance sector.
This will require greater availability of resources with:
Actuarial and risk assessment skills;
Accountancy quali?cations;
Marketing resources with European languages to support product development initiatives;
International tax and legal skills; and
Project management experience.
?
?
?
?
?
?
?
International Financial Services International Financial Services International Financial Services 77
3.5 Expected Future Skills Needs
The overall range of skill-sets required by the sector is not expected to change signi?cantly over the
medium term, with the skill-sets listed in the current skills demand section likely to remain critical in
supporting future growth.
However, international ?nancial services is a knowledge intensive sector and recent developments which
have seen changes in the way products are priced, structured, hedged, and regulated will increase the
requirement for more specialised resources capable of dealing with more complex product sets. This race
towards ever more complex products and pricing structures was articulated by one respondent as:
“an intellectual arms race which has quantitative skills at its core”
Despite the dif?culty in predicting future developments in such a dynamic market place, consultations with
industry respondents suggested that the following roles and skill-sets will increasingly be in demand in the
marketplace over the medium term.
International Financial Services 78 International Financial Services International Financial Services
Table 3.11 Summary of future skills
Role Description/Skill-sets
Derivatives Specialists Resources with deep knowledge of derivative products and markets which enables
them to structure and create innovative derivative based product solutions.
Quali?cations: Advanced quantitative skills (Maths/Statistics/Financial Engineering),
Chartered Financial Analyst (CFA).
?
?
Quantitative Analysts Resources with advanced numeric/quantitative skills (Maths/Economics/
Engineering/Actuary) which enables them to structure, price, risk and model
complex products.
Quali?cations: PhD/Masters in Maths/Statistics/Engineering/Economics, Chartered
Financial Analyst (CFA).
?
?
Financial Control
and Reporting
Resources with high levels of numeracy combined with an understanding of
?nancing and taxation principles.
Quali?cations: Quali?ed accountant, Finance degree.
?
?
Hybrid Technologists Technologists with a background in business systems analysis which enables them
to problem solve and use technology to deliver business solutions.
Quali?cations: Business Systems Analysts.
?
?
Business Development Resources with the interpersonal skills and deep product knowledge which enables
them to understand client needs and sell complex products that are appropriate to
client needs. In aviation leasing relevant industry exposure is a vital pre-requisite.
Quali?cations: Business degree with ?nancial specialism/Chartered Financial
Analyst (CFA)/sector relevant sales certi?cation.
?
?
Behavioural Economists Economists with a background in the study of the impact of events on human
?nancial behaviour.
Quali?cations: Behavioural Economics.
?
?
Pan-European Tax/
Legal Specialists
Tax and legal specialist with cross-jurisdictional knowledge which enables them to
advise on the structure and impacts of pan-European products.
Quali?cations: Professional tax and legal quali?cations.
?
?
Customer Support/
Business Development/
Tax and Legal Specialists
Fluency in European languages which enables reading and interpreting contracts in
other European languages.
Quali?cations: Business, law + languages.
?
?
Funds Servicing
(complex products)
Business and ?nance quali?cations with speci?c knowledge of funds, complex
?nancial instruments and product sets.
Quali?cations: Business/Finance degree.
?
?
Credit Analysis Resources with high levels of numeracy and funding structures capable of
evaluating the risks associated with ?nancial proposals.
Quali?cations: Quali?ed accountant or Finance related degree (aviation leasing
requires additional levels of sector related experience).
?
?
The majority of companies interviewed did not have any plans other than internal training to ensure that
they would have the necessary supply of skills over the medium term. This would suggest that improved
levels of interaction and co-operation between industry and education providers may be advisable to
ensure that the supply-side infrastructure produces suf?cient supply of the skills required by industry.
In addition to the direct future skills requirements of the international ?nancial services sector, growth in
this sector will require an increase in the numbers employed in providing indirect services e.g. legal, audit,
taxation and IT services. Therefore, overall demand requirements need to incorporate an element of excess
capacity to facilitate catering for the needs of support services providers, who are an essential element of
the industry.
International Financial Services International Financial Services International Financial Services 79
Finally, effective and responsive regulation was identi?ed in Building on Success as a key supporting pillar
in developing a stable international ?nancial services sector and, as shown previously, forms one of the key
decision criteria for ?nancial services investment. Therefore, skills development initiatives for the
international ?nancial service sector should ensure that there is an adequate supply of individuals with the
appropriate level of regulatory skills.
In summary, the industry consultation process highlighted a number of areas where the industry is
experiencing dif?culties in sourcing suitably skilled personnel. These current skills needs are summarised in
the table below.
In addition, the table also provides a summary of the future skills which industry representatives expect to
be in demand over the medium term. These skill-sets are in addition to those listed under current skills
which are expected to remain critical to future development of the sector.
Table 3.12 Summary of current and future skills needs
Current and future Future
1. Maths/Economics/Quantitative Modelling
2. Accountancy (funds, audit and ?nancial reporting)
3. Risk Management
4. Compliance
5. Middle-management with ?nancial
services experience
6. Project and change management
7. Funds servicing and banking back-of?ce
8. Actuary
1. Derivatives structuring
2. Quantitative analysis
3. Credit analysis
4. Hybrid technologists – business analysis with IT/
systems skills
5. Business development with detailed product
knowledge/industry quali?cations
6. Pan-European tax/legal specialists
7. Behavioural economists
8. Funds servicing – client relationship management
for complex products
9. Fluency in European languages
10. International compliance
These needs are in addition to the current skills
list opposite.
Investment in developing the skills listed above will provide the basis for growth in the overall ?nancial
services sector and further expansion of Ireland’s areas of distinctive competence, which include:
Funds servicing;
Debt products and securitisation;
Aircraft Leasing; and
Cross border life insurance.
To consider how the skills requirements above translate into the demand for education and training
courses and modules, the estimated demand for industry resources is reviewed with reference to the
supply or potential satisfaction of this demand through the development of new or additional supporting
courseware. These potential courseware developments are described below.
?
?
?
?
International Financial Services 80 International Financial Services International Financial Services
Demand Projections
This section is based on secondary data, feedback from consultations and a series of assumptions. The
basis for the calculations is outlined below. The calculation provides a basis for ‘guestimating’ the future
demand for employees at senior and operational levels within each of the three sectors of the international
?nancial services sector – banking, insurance and funds. Any interpretation of the data should re?ect this.
International ?nancial services sector – total employment
Taking the number of employees in the Irish international ?nancial services sector per the Finance Dublin
Yearbook 2007, of 22,177 as a base, the allocation of these employees across senior management and
operational roles is outlined below and are the estimated projections for growth in employee numbers in
the sector over the period to 2012.
Estimated employment levels for 2012, by sector
Within each of the three sectors, there are two broad categories of skills and employees – employees
involved in operational areas and those involved in more complex functional areas, middle management
or senior management roles. Both groups require different skill sets and experience.
The only group for which some division between the two categories was available was the funds sector.
However, an estimate of this allocation is provided for with regard to the other two sectors.
Funds sector The Irish Funds Industry Association (IFIA) Employment and Staf?ng Survey for 2006 indicated that
77 percent of employees were in general or junior management grades, while the remaining 23
percent were at middle or senior management grades. This split was applied to the employment
?gure for the funds sector of 9,227, to obtain an estimate of employees in each category.
Banking sector During the consultation process, some interviewees provided broad indications of the division of
employees between management and operational roles. Broadly in the banking sector, this was in
the region of 1:4 or 1:5 employees. Therefore it was assumed that 80 percent of employees in this
sector were in operational roles and 20 percent were in management or senior roles.
Insurance sector As with the banking sector, the estimate of 80 percent of employees having an operational role
was applied.
Applying the above assumptions to the opening employment ?gures for 2006 yields the following table.
Table 3.13 Sectoral employment ?gures for 2006 – divided between senior management and
operational roles
Sector 2006
Banking 9,923
Specialist/Middle – senior management (20%) 1,985
Operational (80%) 7,938
Investment Management/Funds 9,227
Senior and mid management (23%) (approx) 2,108
General and junior management (77%) (approx) 7,119
Insurance 3,027
Specialist/Middle – senior management (20%) 605
Operational (80%) 2,422
Total 22,177
Source: Finance Dublin Yearbook 2007 and PwC derived allocations within the sectors.
International Financial Services International Financial Services International Financial Services 81
The future demand for employees within the three sectors of banking, funds and insurance will comprise
two components – the demand for people to replace employees that leave and the demand for skills to
ful?l future growth.
Replacement demand
According to the FÁS/ESRI Manpower Forecasting Studies (Estimating Labour Force Flows, Job Openings
and Human Resource Requirements, 1990-2005) the annual average labour force attrition rates that are
most readily applicable to employees in the ?nancial services sector are:
Business, legal and other professionals 2.8%
Other associate professionals 2.6%
Clerical 3.5%
While these rates are useful for the broader ?nancial services sector, staff turnover levels in the funds
industry have been historically high and in 2005, according to the IFIA Employment and Staf?ng Survey
1,627 employees left their jobs. This comprised a turnover rate of 27 percent at general and junior
management staff levels and 15 percent at middle and senior management levels – albeit that these
rates were based on a lower base number, of 6,800 employees, as mentioned earlier. Given that the
estimates presented in this report are based on an employment ?gure of 9,227 for 2006, turnover rates of
21 percent and 12 percent would yield a ?gure of approximately 1,750 employees leaving their jobs.
Feedback from the industry representatives, during the consultation programme, would also point to
higher levels of staff turnover at an operational level across all sectors of international ?nancial services.
Consequently, the assumed replacement rate for operational level employees within the banking and
insurance sectors is estimated to be higher than the ?nancial services sector average of 3.5 percent, but
lower than the funds sector average of 27 percent. A rate of 10 percent has been assumed for 2006.
On that basis, replacement demand levels for 2006 are estimated as illustrated in the following table.
Table 3.14 Replacement rates In IFS employment in Ireland
Replacement rate at
Sector Operational level Specialist/Middle –
senior management level
Banking 10% 3%
Funds 21% 12%
Insurance 10% 3 %
In subsequent years, it is assumed that the replacement rate will remain at a level of 3 percent for the
senior management employees in the banking and insurance sectors. However, based on the introduction
of initiatives aimed at reducing the turnover level in the operational areas of the international ?nancial
services sector, it is expected that the replacement rate for operational staff will reduce over time. This
reduction is estimated at 0.5 percent per annum for the banking and insurance sectors and 1.2 percent
per annum for the funds sector. The replacement rate in the funds sector at specialist/middle-senior
manager level is also expected to reduce by 0.5 percent per annum. By 2012, the replacement rates in the
funds sector would be 14 percent and 9 percent for operational and specialist/middle-senior management
levels respectively.
International Financial Services 82 International Financial Services International Financial Services
In total, this results in the following level of replacement demand of just over 17,500 people from 2007 to
2012, as set out below.
Table 3.15 Estimated replacement demand 2007-2012
Sector 2007 2008 2009 2010 2011 2012
Banking 887 911 925 928 918 906
Specialist/Middle-senior management 65 70 75 80 83 88
Operational 822 841 850 848 835 818
Investment Management/Funds 1,780 1,800 1,804 1,793 1,764 1,718
Senior and mid management 265 277 287 295 301 305
General and junior management 1,515 1,523 1,517 1,498 1,463 1,413
Insurance 256 250 245 238 232 224
Specialist/Middle-senior management 19 19 20 20 21 22
Operational 237 231 225 218 211 202
Total 2,923 2,961 2,974 2,958 2,914 2,848
Source: PwC derived – based on various assumptions.
Growth Demand
From 1998 to 2006, the overall economy average employment growth rate was 3.8 percent
48
, while the
?nancial sector average employment growth rate was 5.4 percent
49
. Within this sector, the average annual
employment growth rate for the banking sub-sector, over the same period, was 7.1 percent, and in the
corresponding ?gure for the insurance sub-sector was 4 percent
50
.
The Forfás Annual Employment Survey, indicated that the compound annual growth rate in the number of
permanent full-time employees in agency assisted companies in the ?nancial services sector was 10.5
percent for the period from 2002 to 2006, while the growth in the number of employees in the ?nancial
and other business services sector in the year to May 2007 was 7.6 percent, according to the CSO Labour
Market Statistics.
At a sectoral level, Finance Dublin Yearbook indicated that the growth in the employment levels in the
banking sector was 24 percent, insurance sector was 3 percent and the funds sector was 13 percent for
2006. This is in line with the ?ndings from the IFIA Employment and Staf?ng Survey, which indicated that
the funds industry grew by 13 percent in the year to January 2006, and was projected to grow by 16
percent in the year to January 2007.
During the consultation programme, the companies consulted indicated that they expected future growth
in employment levels, albeit that the growth would not be at the levels experienced to date, due to the
contracting economic environment and in?ationary pressures.
48 FÁS/SLMRU – A Study on the Future Skills Requirements of the Financial Services Sector.
49 FÁS/SLMRU – A Study on the Future Skills Requirements of the Financial Services Sector.
50 FÁS/SLMRU – A Study on the Future Skills Requirements of the Financial Services Sector.
International Financial Services International Financial Services International Financial Services 83
The growth rates applied to each sector are therefore:
10 percent for all banking roles;
3 percent for all insurance roles;
10 percent for specialist/middle-senior roles in the funds sector; and
8 percent for operational roles in the funds sector.
It is also assumed that the growth rate for the banking sector will reduce by approximately 1 percent per
annum to 2011, levelling out at 5 percent growth rate thereafter. The growth rate assumption for the funds
sector is based on a starting growth rate in 2006 of 10 percent for senior roles and 8 percent for
operational roles, both of which are assumed to reduce by 0.5 percent per annum. This results in a growth
rate of 7 percent for senior and mid management roles in the funds sector in 2012 and 5 percent for
operational roles in this sector.
This yields a total growth in employee numbers of 9,700 over the period from 2007 to 2012, as
outlined below.
Table 3.16 Estimated growth in employment levels for 2007-2012
Sector 2007 2008 2009 2010 2011 2012
Banking 893 865 818 750 663 695
Specialist/Middle-senior management 179 173 164 150 133 139
Operational 714 692 654 600 530 556
Investment Management/Funds 734 744 746 741 729 710
Senior and mid management 200 208 214 218 221 222
General and junior management 534 536 532 523 508 488
Insurance 91 94 96 99 102 105
Specialist/Middle-senior management 18 19 19 20 20 21
Operational 73 75 77 79 82 84
Total 1,718 1,702 1,660 1,591 1,494 1,510
Source: PwC derived – based on various assumptions
Table 3.17 illustrates total employment growth over the period, broken down by operation level and
specialist/middle/senior management level.
Table 3.17 Forecast Employment Growth by Sector 2007-2012*
Growth in employee numbers from 2006-2012
Sector Operational level Specialist/Middle-senior
management level
Banking 3,750 950
Funds 3,100 1,300
Insurance 500 100
Total 7,350 2,350
* Note ?gures in table 3.17 are rounded.
?
?
?
?
International Financial Services 84 International Financial Services International Financial Services
This equates to an average growth level of approximately 1,600 additional resources per annum,
approximately 400 at specialist/middle-senior management level and 1,200 at operational levels.
Recruitment Requirement
Combining the replacement requirement of just over 17,500 and the growth demand of under 10,000
yields a total recruitment requirement of just under 27,500, over the period from 2007 to 2012, or
approximately 4,600 per annum.
Comparison of Supply and Demand Levels
The calculation of the level of skills supplied to the international ?nancial services sector is complicated by
the diverse pool from which resources can be drawn. However, by focussing on the main lines of supply,
an estimate of relevant education outputs across ?nancial ?elds per annum can be developed. This
estimate is outlined the following table
51
.
Table 3.18 Summary of estimated education output across ?nancial ?elds
Field Enrolments Awards
Higher education 5,000 1,200
52
Professional institutions 15,000 1,800
Accounting technician 5,500 4,300
Accounting 25,500 7,300
Actuarial studies 600 40
Economics and statistics 1,400 400
Tax 1,300 300
Higher education
undergraduate
1,500 600
Higher education postgraduate 350 200
Professional institutions 4,600
CFA 300 50
FÁS 100 100
Finance and insurance 2,250 5,500
Risk 200 70
Total 31,250
53
13,610
Source: SLMRU report, 2007 (PwC amended).
Note: ?gures are rounded.
The annual educational awards, in ?nancial ?elds, amount to just over 13,500 awards per annum.
However, of this potential supply only a portion opts to pursue a career in international ?nancial services.
Many of the graduates/awardees are already in employment (e.g. the actuarial and accountancy students)
and many others go into employment in either domestic ?nancial services or non-?nancial services sectors.
51 FÁS/SLMRU – A Study on the Future Skills Requirements of the Financial Services Sector.
52 This ?gure was not in the SLMRU Report, but was subsequently provided to PwC by FÁS.
53 The enrolments ?gure for ‘Finance and Insurance – professional institutions’ was not available; hence the total ?gure for enrolments is understated in
the table above.
International Financial Services International Financial Services International Financial Services 85
The industry consultations provided some insight into the nature and causes of the skills needs
experienced in the sector.
Speci?cally at operational levels, the lack of supply was primarily due to a shortage of personnel, but
also personnel with quali?cations in insurance, ?nance and/or accounting, with a particular
international ?nancial services dimension.
Within the middle/senior management/specialist functional roles the lack of supply is due to:
The low number of graduates choosing a career in international ?nancial services;
The lack of graduates with a specialist knowledge of international ?nancial services;
The lack of graduates with specialist skills in areas such as: actuarial studies; economics; maths;
statistics; and international taxation; and
In the case of some roles, the limited availability of personnel with these skills, but also with
appropriate levels of experience e.g. middle management; risk management, etc.
In summary, the nature of the supply of educated personnel is not aligned to the education and skills
demands of the international ?nancial services sector.
To satisfy this demand, it is recommended that speci?c modules addressing these needs are added to
existing course curricula and where needed that new courses are introduced addressing the demand for
skills outlined in table 3.12. The nature and size of the courses recommended at foundation, graduate and
postgraduate level are outlined in the table below. This table is indicative, and it is not intended to be
exclusive or exhaustive. It provides guidance on course nature and content but it is up to the individual
course developers to tailor the course in line with industry needs.
?
?
?
?
?
?
International Financial Services 86 International Financial Services International Financial Services
Table 3.19 Summary of the nature and content of new courseware
Skill demand Course topics/contents Course features (delivery, scale, etc)
Foundation level
Funds servicing and
banking back-of?ce
Introductory Funds Industry course with
modules including:
Basic accounting; and
Principles of fund administration (Valuation,
Settlements, Custody and Corporate Actions).
?
?
Short duration 8-12 weeks.
Flexible delivery mechanisms to
include distance learning/web.
Simulated environments/
work experience.
Scaleable model to facilitate high
volume and regional delivery up to
1,500/annum.
?
?
?
?
Funds servicing –
client relationship
management for
complex products
Introductory Funds Industry course with
modules including:
Basic accounting;
Principles of fund administration;
Effective communications; and
Client Relationship Management.
?
?
?
?
Short duration 8-12 weeks.
Flexible delivery mechanisms to
include distance learning/web.
Simulated environments/
work experience.
Scaleable model to facilitate medium
to high volume up to 200/annum.
?
?
?
?
Fluency in
European languages
Inclusion of modules in general ?nancial services
courses, including:
Business and legal language training; and
International business ?nance.
?
?
Modular training incorporating.
Aural training.
Low volume (<50 per annum).
?
?
?
Graduate level
Maths/Economics/
Quantitative
Modelling
General Mathematics and Economics degree
programmes with a focus on higher level
quantitative skills. Modules might include:
Econometrics;
Quantitative modelling in C++;
Product development;
Product modelling;
Asset pricing; and
Stochastic modelling.
?
?
?
?
?
?
Degree programme.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (approx. 20 per annum).
?
?
?
?
Accountancy with
funds experience
Accounting courses with a focus on fund
accounting (modular format).
Degree programme with
professional exams.
Incorporating applied/case study
elements from funds servicing
environments.
Work experience.
Medium volume (300+ per annum).
?
?
?
?
Risk Management General Risk Management courses with
modules covering:
Risk management in ?nancial institutions;
International risk management;
Risk modelling;
Regulation; and
Compliance.
Reference course – BSc in Insurance and Risk
Management offered by Penn State and BSc in
Investment and Financial Risk Management
offered by Cass.
?
?
?
?
?
Degree programme.
Specialised modules incorporated into
existing degree programmes.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (<50 per annum).
?
?
?
?
?
International Financial Services International Financial Services International Financial Services 87
Skill demand Course topics/contents Course features (delivery, scale, etc)
Quantitative
?nancial analysis
Quantitative ?nance/Mathematics courses with
modules in the following areas:
Technical skills in quantitative
?nancial analysis;
Quant asset management;
Financial engineering;
Quantitative strategic analysis; and
Quantitative strategy implementation.
?
?
?
?
?
Degree programme.
Specialised modules incorporated into
existing degree programmes.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (approx. 20 per annum).
?
?
?
?
?
Credit analysis General Financial services degree programmes
with modules in:
Financial analysis technology;
Scenario modelling;
Credit analysis and rating interpretation;
Company research; and
Asset quality/Forensic accounting.
?
?
?
?
?
Degree programme.
Specialised modules incorporated into
existing degree programmes.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (approx. 20 per annum).
?
?
?
?
?
Hybrid technologists
– business analysis
with IT/systems
skills
IT Courses with a speci?c focus on ?nancial
services, including:
Applying IT to ?nancial services;
Financial products;
Financial modelling;
Product development; and
Business systems analysis.
?
?
?
?
?
Degree programme or 6 month/1 year
graduate diploma programme/
conversion course to provide
graduates from IT courses with basic
?nancial services skills.
Classroom based.
Medium volume
(approx. 100 per annum).
?
?
?
Business
development with
detailed product
knowledge/industry
quali?cations
Incorporation of ?nancial services aspect into
general Business/Marketing courses:
Topics might include:
Introduction/background to international
?nancial services;
Products, services and markets; and
Financial products and markets.
?
?
?
Certi?cate course/module providing
business and marketing graduates
with an understanding of ?nancial
products and instruments.
Medium volume
(approx. 80 per annum).
?
?
Middle-
management with
?nancial services
experience
Incorporation of following skills into ?nancial
services related courses:
General business skills;
Marketing skills;
Business development skills; and
Effective communication skills.
?
?
?
?
Certi?cate course/conversion course
providing a basic understanding of
?nancial products and instruments,
the IFS sector and general
management training.
Medium volume
(approx. 80 per annum).
?
?
Postgraduate level
Compliance/
International
compliance
Provision of specialist programmes/research into
the area of international regulation and
compliance. Including modules in:
Audit principles; and
System controls.
Reference course – MSc in Capital Markets,
Regulation and Compliance.
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 30 per annum).
?
?
?
International Financial Services 88 International Financial Services International Financial Services
Skill demand Course topics/contents Course features (delivery, scale, etc)
Risk Management Provision of specialist programme/research in
relation to:
Risk management in ?nancial institutions;
Risk modelling; and
Added quantitative techniques.
Reference course – MSc in Financial Risk
Management as offered by Reading University.
?
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 20 per annum).
?
?
?
Derivatives
structuring
Specialist Derivative programme including
modules in:
Financial engineering;
Dynamic asset pricing theory;
Portfolio risk analysis;
Credit risk and Derivative products; and
Stochastic modelling.
?
?
?
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 20 per annum).
?
?
?
Behavioural
economics
Economic specialist programme with a focus on:
Economic theory;
Behavioural science;
Rational theory;
Momentum investing; and
Arbitrage.
?
?
?
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 20 per annum).
?
?
?
Project and change
management
Certi?cate in Project Management incorporating
modules such as:
Project management procedures
and techniques;
Project planning and control;
Quality management; and
Earned value analysis.
?
?
?
?
Certi?cate course in project
management best practices
incorporating ?nancial services
case studies.
Medium volume
(approx. 80 per annum).
?
?
Pan-European tax/
legal specialists
Specialist programme for tax and legal graduates
to provide an international perspective.
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 20 per annum).
?
?
?
Actuary Specialist Actuarial programme with
particular reference to the international ?nancial
service sector.
For example – MSc in Actuarial Science and
MSc in Actuarial Management as offered by
Cass university.
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 20 per annum).
?
?
?
The table above outlines the nature of the courses required, the broad course content and the features of
the course format and capacity levels.
International Financial Services International Financial Services International Financial Services 89
In essence, at foundation level the requirement is for short courses with ?exible delivery mechanisms,
aimed at bringing alternative populations of personnel (back) into the workforce in high numbers.
At undergraduate – graduate level the emphasis is on both: developing specialised modules which can
be updated regularly to re?ect industry trends and incorporated into existing degrees programmes; and
developing new or updating existing degree programmes to provide greater focus on particular skills
demands (e.g. tailored towards hybrid technologists or credit analysts). Where appropriate, applied or case
study elements and work experience should be incorporated into these programmes.
The postgraduate proposition is for specialist programmes of varying length focused on particular
specialist skills (e.g. international compliance, behavioural economics, etc.). Again these courses should
incorporate applied or case study elements. The focus at this level is primarily on new courses, which are
dynamic in nature, re?ecting latest industry trends.
The key challenge for Ireland is to act with urgency to introduce new course materials that are innovative
and industry-focused, and which are targeted at addressing the demands identi?ed for the sector over the
next ?ve years. Given the time lag involved between introducing new courseware and producing graduates,
it is imperative that timely solutions are considered as part of the skills provision mix in the short term, for
example, by adding on tailored industry-speci?c modules to existing courses.
International Financial Services 90 International Financial Services International Financial Services
3.6 Supply Side Dynamics
This section is based on the views supplied during the industry consultations in addition to publicly
available research and statistics. It examines the trends impacting the future skills supply to the
international ?nancial services sector, in particular:
1. Demographic pro?le;
2. Levels of mathematical pro?ciency; and
3. Availability of “industry-ready” graduates.
Ireland’s young population (only 11 percent of the population over 65) relative to other European
countries results in a large proportion of the population belonging to “working age” demographics
54
.
Further population growth combined with continued investment in our educational system will be critical
going forward to ensure there is a suf?cient supply of skilled resources to support the projected growth in
the ?nance and business sector of the labour market.
As can be seen from the skills demands highlighted previously, a strong emphasis is placed on the
importance of mathematical and quantitative analysis skills by industry respondents as a pre-requisite to
moving up the ?nancial services value chain. In this regard the recent decline in scores for mathematical
literacy and the overall numbers choosing higher-level maths and science subjects for the Leaving
Certi?cate is a cause for concern. The data shows that the numbers opting for these subjects at higher level
has dropped from 25 percent in 2001 to 18 percent in 2005.
A recent EGFSN report cited that Ireland is currently ranked 20th out of 40 countries by PISA for
mathematical literacy of 15 year-olds. In terms of overall mathematical ability, 40 percent of Irish
15 year-olds were classed as being unable to ‘select and apply simple problem-solving procedures’ or even
to ‘execute clearly described procedures’. For the mathematical sub-category of spatial and geometric
relationships this proportion increased to 52 percent
55
.
Another area of concern, in terms of the future supply of resources, exists around the numbers of students
who are choosing to study computers and technology related subjects, as this is a key enabler of the
?nancial services sector. Technology related disciplines have experienced a decline in popularity amongst
school leavers as illustrated in table 3.19 below. A decline has occurred in all disciplines within technology,
excluding construction, with the most signi?cant decline occurring in computing courses (down from
8.7 percent in 2000 to 3.5 percent percent in 2006)
56
. Engineering and computing courses have
experienced a decline in both absolute ?gures and in the overall proportion of students accepting courses.
This is largely attributed to only 7,000 students in 2007 achieving Grade C or above in higher-level maths,
which is a minimum entry requirement for many of these courses
57
.
54 Irish Times Report on CSO study – June 2007.
55 Tomorrow’s Skills – Towards a national skills strategy – 5th report of the EGFSN.
56 CAO Acceptance Report, 2006.
57 Irish Times, August 24th, 2007.
International Financial Services International Financial Services International Financial Services 91
Table 3.20 Total CAO acceptances by category 2000-2005
Discipline Acceptance 2000 Acceptance 2005 Acceptance 2006
Engineering 1,664 (8.0%) 1,206 (4.8%) 1,192 (4.5%)
Construction 609 (2.9%) 1,116 (4.5%) 1,033 (3.9%)
Computing 1,809 (8.7%) 995 (4.0%) 927 (3.5%)
Science (non-healthcare) 2,495 (12.0%) 2,665 (10.7%) 2,490 (9.4%)
Agriculture and Veterinary 324 (1.6%) 284 (1.1%) 318 (1.2%)
Nursing 0 (0.0%) 1,822 (7.3%) 2,040 (7.7%)
Medicine 330 (1.6%) 306 (1.2%) 424 (1.6%)
Dentistry 66 (0.3%) 63 (0.3%) 66 (0.25%)
Other Healthcare 443 (2.1%) 1,175 (4.7%) 1,271 (4.8%)
Arts and Humanities 6,237 (30.1%) 7,359 (29.5%) 7,973 (30.1%)
Education 1,163 (5.6%) 2,083 (8.3%) 2,040 (7.7%)
Business and Law 4,847 (23.4%) 5,269 (21.1%) 5,986 (22.6%)
Social Services 78 (0.4%) 236 (0.9%) 397 (1.5%)
Services 311 (1.5%) 405 (1.6%) 344 (1.3%)
Total all 20,728 (100%) 24,984 (100%) 26,488 (100%)
Source: Tomorrow’s Skills Towards a National Skills Strategy, EGFSN 2007 and CAO Acceptance Figures 2006.
Ireland’s current performance for scienti?c and mathematical literacy poses a challenge to our objective of
developing a “knowledge-based economy”, and if left un-addressed, will prove particularly harmful to the
future development of the international ?nancial services sector.
While the Irish education system in seen as producing good quality graduates, a number of industry
respondents highlighted that Irish graduates were perceived as “skilled generalists” and very rarely had
specialised knowledge in a particular area of ?nancial services, which would enable them to operate at a
higher levels. This contrast was particularly marked when viewed against the US system, which facilitates
students specialising in particular niches which ensures a higher level of pro?ciency upon course completion.
This apparent lack of specialisation was also raised in the context of our market positioning and cost base. It
was suggested that if graduates were expecting to command above average levels of remuneration then
being a skilled generalist was not suf?cient as many competing centres also have high volumes of “skilled
generalists” available at lower labour cost rates. It was suggested that our education system should provide a
greater focus on specialising in a number of selected areas which would support the development of an
internationally distinctive competence which was more aligned with a mid to high cost base.
Availability of ‘Industry Ready’ Graduates
A number of respondents commented on the lack of relevant work experience that many graduates now
have when seeking employment in the ?nancial services sector. The increasing trend towards travelling
during summer breaks to work in casual employment has resulted in a large number of graduates who,
despite strong academic quali?cations, lack experience of working in an of?ce environment. This was
termed as a lack of “industry readiness” in graduates. This contrast was particularly marked when viewed
against continental European countries where undergraduates are required to participate in a number of
internships as part of their educational studies. This ensures that they see the practical application of their
education in a live work setting, and as graduates, that they can adapt and contribute immediately as they
encounter less of a learning curve in entering the work environment.
International Financial Services 92 International Financial Services International Financial Services
The notable exceptions to this, were colleges which included work placements as part of their existing
curriculum. This practice was viewed very favourably by industry with several respondents stating that
quality work experience made these undergraduates instantly more employable and often placed them on
a par with students who had pursued postgraduate level studies.
Future Skills Development Infrastructure
Entry level positions
For less specialised roles within the international ?nancial services sector, companies expect that the
educational system will supply graduates with business or general disciplines (not necessarily to degree
standard) who have good levels of literacy and numeracy and who have the right attitude and interest to
work in the industry. This was articulated as:
“good generalists that are trainable”.
For these roles companies expected that the speci?c skills required for job performance would be
delivered by the company as part of internal on the job training programmes. This would be common for
many entry-level positions in the sector.
Skills development
For the subsequent up-skilling of resources, companies preferred to use in-house training resources or
specialist training providers. In-house skills development is typically achieved through a number of
mechanisms:
On the job training;
Internally developed training courses;
e-learning solutions (possibly produced at corporate level); and
Mentoring.
For certain specialist skills e.g. regulation specialist external training companies are often used.
The ?nancial services industry is differentiated by the level of sophistication that exists in terms of skills
training delivery by industry professional bodies. Groups such as the Institute of Bankers, the Irish
Insurance Federation, and the Irish Taxation Institute provide extensive specialised short-course education
to support industry development needs. These modularised courses are ?exible enough to scale between
addressing speci?c skills gaps and achieving recognised industry certi?cation standards. Many of these
courses are delivered in formats which minimise time away from the job e.g. distance learning/home study
supported by weekend tutorials.
The skills delivery infrastructure to support the future development of the international ?nancial services
sector needs to be capable of supporting the full range of roles and skills required e.g. administrative to
high skill PhD level. This tiered system of skills delivery ensures a comprehensive infrastructure is available
to address skills gaps.
?
?
?
?
International Financial Services International Financial Services International Financial Services 93
Most companies were also supportive of staff who engaged in relevant postgraduate studies. This was
typically used to support executive/general management skills development. Investment in training is
increasingly viewed by companies as an effective tool to improve levels of staff retention and job
satisfaction through improved career advancement opportunities.
The role of third level in skills development
International industry interviews suggested that there are limited formal linkages between universities and
companies to address skills gaps through the co-development of courses/curricula. This would also appear
to be the situation in Ireland as the consultations indicated that until recently the more traditional
academic institutions (universities and colleges) have been viewed as quite removed from the specialist
skills development requirements for ?nancial services. A number of factors were cited for not using these
institutions to support skills development, these were:
Course length – too much time away from the job;
Lack of relevant practical industry experience of lecturers;
Delivery format – on campus delivery; and
Cost.
There does, however, appear to be a change in this situation underway, with several institutions looking to
establish closer linkages with industry to better understand their skills development requirements. This is
evidenced by a number of recent announcements of initiatives such as the Global Finance Academy (UCD),
the Financial Services Innovation Centre (UCC), and Pioneer Investments support in developing new
Quantitative Finance programmes which will incorporate work placements.
?
?
?
?
International Financial Services 94 International Financial Services International Financial Services
3.7 Summary
Key conclusions from the industry consultations are listed below:
Ireland has several natural advantages and foundations to support the development of a strong
international ?nancial services sector, which has the potential to become a signi?cant European base
for many international ?nancial service organisations. The availability and stability of an appropriately
skilled workforce is critical to this. There are, however, indications are that this is already presenting a
limiting factor, which if left unaddressed will negatively impact upon the sector’s future growth
potential. A number of industry sources expressed the view that the sector is currently “capacity
constrained” in terms of skills and until the issues of availability and stability are addressed it will be
dif?cult to make a case for expanding existing operations or developing into higher value activities.
To increase the supply of resources a tiered solution towards skills development is required. A
mechanism for up-skilling non-graduates to enable them to ?ll administrative functions would increase
the overall available resource pool and possibly provide a more stable resource base, thereby reducing
attrition levels. In addition, this would free-up graduates to be deployed to tasks which are more
aligned with their skills and education. A matrix of possible foundation level courses describing the
content, duration and capacity for such courses is provided in this section.
Promotion of the sector is perceived as being poor with universal acceptance that career guidance at
school and college levels needs to be enhanced to provide candidates with improved quality of
information on the range and scope of roles available within the sector.
Improved linkages between industry and third level course providers (particularly at university level) are
required to ensure that course content is relevant to current industry developments and incorporates
“applied” elements which will help to improve the market readiness of students to take on roles within
the sector. A matrix of possible graduate and postgraduate level courses describing the content,
duration and capacity for such courses is provided in this section.
A mechanism to assist undergraduates to avail of work placement opportunities in ?nancial services
should be examined and course developers should seek to increase the number of courses which
incorporate placements.
Advanced mathematical competencies are critical in underpinning the knowledge intensive elements of
this sector. It will not be possible to attract the highest skill roles if the available pool of highly numerate
resources is insuf?cient. Action is required to increase the numbers taking maths and science based
courses at higher levels, along with measures to highlight the employment opportunities for people
with these skills in the ?nancial services sector.
Technology is a key enabler of this sector e.g. straight through processing and passive fund
management. Technology courses which incorporate an understanding of business processes and
systems would facilitate technologists being deployed into higher value problem solving roles.
Technology skills will be a critical requirement to the credibility of positioning Ireland as a ?nancial
services solutions centre.
?
?
?
?
?
?
?
International Financial Services International Financial Services International Financial Services 95
The key challenge for Ireland is to act with urgency to introduce new course materials that are
innovative and industry-focused and which are targeted at addressing the demands identi?ed for the
sector over the next ?ve years. Given the time lag involved between introducing new courseware and
producing graduates, it is imperative that timely solutions are considered as part of the skills provision
mix in the short term, for example, by adding on tailored industry-speci?c modules to existing courses.
The mechanisms used to regulation skilled migration into Ireland (such as the Green Card system) and
the range of programmes designed to attract skills migrants from abroad must remain competitive
vis-a-vis other jurisdictions.
?
?
International Financial Services 96 International Financial Services International Financial Services
Chapter 4: Review of Irish
Financial Services Skills and
Research Providers
4.0 Introduction
This section of the report contains details of the development and delivery of educational, training
and research programmes provided by Irish universities, institutes of technology and training bodies,
in the ?nancial services area. The analysis is based on information provided as part of a consultation
programme with:
Well-established leading Irish universities with tertiary level ?nancial services programmes;
Institutes of technology with tertiary level ?nancial services programmes, including some niche ?nance
courses; and
Industry training bodies dedicated to training those in ?nancial services.
In all, 15 education, training and research programme providers were consulted as part of this study, as
listed in Table 4.1 below.
Table 4.1 Universities, institutes of technology, industry training bodies consulted
Universities Institutes of Technology Industry Training Bodies
University College Dublin (UCD)
Trinity College Dublin (TCD)
Dublin City University (DCU)
University of Limerick (UL)
University College Cork (UCC)
National University of Ireland, Galway
(NUIG)
National University of Ireland,
Maynooth (NUIM)
Sligo Institute of Technology (SIT)
Waterford Institute of Technology
(WIT)
Letterkenny Institute of Technology
(LYIT)
Athlone Institute of Technology (AIT)
Institute of Bankers (IoB)
Insurance Institute of Ireland (III)
Chartered Financial Analyst Institute
(CFA)
The scope of this section is focused on the academic institutions provision of ?nancial services education,
training and research. It must be noted that teaching and research are inextricably linked. Research feeds
into teaching and subject matter for curricula and graduates and researchers feed in from education into
particular research areas. In all institutions interviewed, it was found that teaching and research are
interdependent and any reference to ‘research providers’ throughout this section should be viewed in
this light.
The information presented in this section of the report does not represent a census of ?nancial services
education and training in Ireland, but re?ects the course provision by the interviewees listed above. All
subsequent presentation of information in this section of the report relates solely to the education and
training providers interviewed.
?
?
?
International Financial Services International Financial Services International Financial Services 97
Each of the organisations consulted and listed above are involved in the provision of ?nancial services
courses. The nature and extent of the educational programmes, both undergraduate and postgraduate, are
described in the following tables (Tables 4.2 to 4.4) and ?nancial services research activities are described
in Section 3, Research Activity.
In Tables 4.2 to 4.4, each of the ?nancial services courses are categorised under the ‘National Framework
of Quali?cations’ (NFQ) established by the National Quali?cations Authority of Ireland (NQAI) in 2003. The
Framework consists of ten levels, as illustrated below.
Table 4.2 Explanation of the National Framework of Quali?cations
NQAI levels NQAI levels
L 10 Doctoral Degree (PhD) L 4/5 Leaving Certi?cate
L 9 Masters Degree and Postgraduate Diploma L 4 Level 4 Certi?cate
L 8 Honours Bachelor Degree and Higher Diploma L 3 Level 3 Certi?cate and Junior Certi?cate
L 7 Ordinary Bachelor Degree L 2 Level 2 Certi?cate
L 6 Advanced Certi?cate and Higher Certi?cate L 1 Level 1 Certi?cate
L 5 Level 5 Certi?cate - -
Absence of course NFQ level indicates that this has yet to be agreed/assigned by the provider and the NQAI).
Table 4.3 Financial services related courses delivered by Irish universities
1
Institution Classi?cation Undergraduate courses Postgraduate courses
Trinity
College
Dublin
Financial Services Business, Economics and Social
Studies [Finance specialism] (L8)
? MSc Finance** (L9) ?
Mathematics BSc Mathematics (L8) ? Postgraduate Mathematical Study [PhD/
MSc by research] (L10/L9)
?
Business/Other Bachelor of Business Studies (L8)
Management Science and
Information Systems Studies (L8)
BA Economics (L8)
?
?
?
Masters in Business Administration (L9)
MSc Economics (L9)
MSc Economic Policy Studies (L9)
PhD Economics (L10)
PhD Finance (L10)
?
?
?
?
?
University
College
Dublin
Financial Services BA Actuarial and Financial
Studies (L8)
BSc Economics and Finance
Studies (L8)
B.Comm. [Banking and Finance/
Insurance specialism] (L8)
Bachelor of Financial Services
[in association with IoB and III,
LIA] (L8)
?
?
?
?
H. Dip. Actuarial Science (L8)
MSc Actuarial Science (L9)
MSc Quantitative Finance (L9)
MBS Financial Services (L9)
Executive Masters in Risk Management
[delivered by IoB] (L9)
Structured PhD Programme in
Finance* (L10)
Executive MBA in Regulation and
Compliance (jointly delivered
with IoB)* (L9)
MBA Financial Services (jointly delivered
with IoB)* (L9)
Doctorate of Business Administration***
MSc Equity Analysis** (L9)
MSc Capital Markets and
International Finance** (L9)
?
?
?
?
?
?
?
?
?
?
?
1 Table 4.3 excludes any Executive related courses. It also excludes any IT speci?c courses however it is noteworthy that some of these may be relevant
for example UCD’s PhD Management Information Systems.
International Financial Services 98 International Financial Services International Financial Services
Institution Classi?cation Undergraduate courses Postgraduate courses
Mathematics BSc Mathematical Science (L8)
BA Mathematical Studies (L8)
BSc/BA Statistics (L8)
?
?
?
MSc Mathematical Science (L9)
H. Dip Mathematical Science (L8)
MSc Mathematics (L9)
MSc Statistics (L9)
H. Dip Statistics (L8)
PhD Mathematics (L10)
?
?
?
?
?
?
Business/Other Bachelor of Business and Legal
Studies (L8)
BA Economics (L8)
BA International Economics (L8)
BA Economics and Politics (L8)
B. Comm. (Finance/International/
Business and Chinese Studies)
?
?
?
?
?
Masters of Accounting (L9)
Masters in Management (L9)
Master of Management Science (L9)
MA Economics (L9)
H. Dip. Economic Science (L8)
PhD Economics (L10)
PhD Accounting (L10)
?
?
?
?
?
?
?
Dublin
College
University
Financial Services BA Accounting and Finance (L8)
BSc in Quantitative Finance (L8)
BA Business Studies
(Finance specialism) (L8)
BSc Financial Mathematics* (L8)
BSc Actuarial Mathematics* (L8)
[previously BSc Financial and
Actuarial Mathematics]
?
?
?
?
?
MSc Finance and Capital Markets (L9)
Grad. Cert. Corporate Treasury (awaiting
NFQ classi?cation)
MSc Investment and Treasury (L9)
Grad. Cert. Actuarial Science (awaiting
NFQ classi?cation)
?
?
?
?
Mathematics MSc Mathematical Science ? MSc Financial and Industrial
Mathematics (L9)
?
Business/Other BSc Business Studies (L8)
BA European Business (L8)
BA International Business and
Languages (L8)
BA Economics, Politics and
Law (L8)
?
?
?
?
MBS Accounting (L9)
Professional Diploma in Accounting
(awaiting NFQ classi?cation)
?
?
University
College
Cork
Financial Services BSc Finance (L8)
BSc Financial Mathematics
and Actuarial Science (?rst grads
2006) (L8)
?
?
MBS Corporate Finance and
Accounting (L9)
H. Dip. Accounting and Corporate
Finance (L8)
MSc Financial Economics (L9)
?
?
?
International Financial Services International Financial Services International Financial Services 99
Institution Classi?cation Undergraduate courses Postgraduate courses
University
College
Cork
cont../
Mathematics BSc Mathematical Sciences (L8)
BSc Mathematics and Physics
(L8)
BSc Applied Mathematics and
Physics (L8)
BA Applied Mathematics and
Economics (L8)
BA Mathematics and Economics
(L8)
BA Mathematics and Applied
Mathematics (L8)
BA Applied Mathematics and
Mathematical Studies (L8)
BA Applied Mathematics (L8)*
BA Mathematics (L8)*
BA Mathematical Studies (L8)*
* BA degrees involving mathematical
subjects at UCC are joint honours
degrees combining either two
mathematical subjects or a
mathematical subject and another
Arts subject.
?
?
?
?
?
?
?
?
?
?
H Dip in Applied Science – Applied
Statistics and Statistical Computing (L8)
Postgrad Dip in Applied Science –
Modelling and Numerical Computing
(L9)
MSc Mathematical Modelling and
Scienti?c Computing (L9)
MSc Modelling and Numerical
Computing (L9)
MSc Statistics (L9)
MSc Applied Mathematics (L9)
MSc Mathematical Physics (L9)
MSc Mathematics (L9)
MA Applied Mathematics (L9)
MA Mathematical Physics (L9)
MA Statistics (L9)
MA Mathematics (L9)
MPhil Applied Mathematics (L9)
MPhil Mathematical Physics (L9)
MPhil Statistics (L9)
MPhil Mathematics (L9)
MPhil Mathematical Studies (L9)
PhD Mathematics (L10)
PhD Applied Mathematics (L10)
PhD Mathematical Physics (L10)
PhD Statistics (L10)
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
Business/Other BSc Business Information
Systems (L8)
BSc Accounting (L8)
B. Comm. (L8)
BA Economics (L8)
?
?
?
?
MBS Business information Systems (L9)
MBS Management Information and
Managerial Accounting (L9)
H. Dip. Business and Financial
Information Systems (L8)
MA/MEconSc Economics (L9)
H. Dip. Economics (L8)
Postgrad. Dip. Business Economics (L9)
MBS Business Economics (L9)
?
?
?
?
?
?
?
International Financial Services 100 International Financial Services International Financial Services
Institution Classi?cation Undergraduate courses Postgraduate courses
University
of
Limerick
Financial Services BSc Financial Mathematics
Bachelor Business Studies
[economics and ?nance/
accounting and ?nance/risk
management and insurance] (L8)
BA International Insurance and
European Studies (L8)
?
?
?
MSc Financial Services (L9)
MSc Computational Finance* (L9)
?
?
Mathematics BA Mathematical Sciences (L8)
BSc Economics and Mathematical
Sciences (L8)
BSc Mathematical Sciences (L8)
?
?
?
-
Business/Other BA Law and Accounting (L8)
BA Economics and Sociology (L8)
?
?
-
NUI
Galway
Financial Services BSc Financial Mathematics and
Economics (L8)
BA Economics and Mathematics
?
?
MEconSc International Finance* (L9)
MSc Quantitative Mathematics [two
streams, actuarial studies and ?nancial
modelling]** (L9)
?
?
Mathematics BSc Computing Studies and
Mathematics (L8)
BSc Mathematics (L8)
BSc Mathematics Physics (L8)
?
?
?
H. Dip. Mathematics (L8)
MSc Mathematics (L9)
MSc Mathematical Science (L9)
PhD Mathematics (L10)
?
?
?
?
Business/Other B. Comm. (L8)
B.Comm. International (L8)
BSc Business Information
Systems (L8)
BA Economic and Social
Studies (L8)
?
?
?
?
MA Accounting (L9)
MSc Business Information System (L9)
PhD Commerce/Economics (L10)
MEconSc Economic Policy and
Planning (L9)
MEconSc Economic and Environmental
Modelling (L9)
H. Dip. Economic Science (L8)
?
?
?
?
?
?
NUI
Maynooth
Financial Services BA Finance (L8)
BA Finance and Venture
Management (L8)
BA Finance and Accounting (L8)
?
?
?
H. Dip. Mathematics (L8)
H. Dip. Mathematical Science (L8)
H. Dip Mathematical Studies (L8)
MA/MSc Mathematics (L9)
MA/MSc Mathematical Science (L9)
H. Dip Statistics (L8)
MSc Statistics (L9)
PhD Mathematics/Statistics (L10)
?
?
?
?
?
?
?
?
Mathematics BSc/BA Mathematics (L8)
BSc/BA Statistics (L8)
BA Mathematical Studies (L8)
?
?
?
H. Dip. Mathematics (L8)
H. Dip. Mathematical Science (L8)
H. Dip Mathematical Studies (L8)
MA/MSc Mathematics (L9)
MA/MSc Mathematical Science (L9)
H. Dip Statistics (L8)
MSc Statistics (L9)
PhD Mathematics/Statistics (L10)
?
?
?
?
?
?
?
?
Business/Other BA Business and Management*
(L8)
BA Economics (L8)
?
?
MA Accounting** (L9)
MA Economics (L9)
H. Dip. Economic Science (L8)
?
?
?
* Programme beginning in academic year 2007/2008. ** Programme beginning in academic year 2008/2009.
*** start date unknown. Source: PwC derived.
International Financial Services International Financial Services International Financial Services 101
Table 4.4 Financial services related courses delivered by Irish Institutes of Technology
Institution Classi?cation Undergraduate courses Postgraduate courses
Waterford IT Financial
Services
BA Financial Services [two-year, add-on] (L8)
Bachelor of Business Studies
(Economics and Finance) (L8)
BA Finance and Investment* (L8)
?
?
?
MBS [Economics and
Finance] (L9)
PhD Finance (L10)
?
?
Business/
Other
BA Accounting (L8)
BA General and Corporate Administration (L8)
BA International Business (L8)
Higher Cert. in Business Studies (L6)
Bachelor of Business Studies [Accounting] (L8)
Business Information Systems [2 year add-on] (L8)
?
?
?
?
?
?
MA Accounting (L9)
MBA International
Business (L9)
?
?
Athlone IT Financial
Services
BA Accounting and Finance
[one-year, add-on] (L8)
Higher Cert. in Business in Financial Services (L6)
Bachelor of Business in Financial Services
[one-year, add-on] (L7)
?
?
?
-
Business/
Other
Higher Cert in Business (L6)
Bachelor of Business [one-year, add-on and four-
year course] (L7/8)
Bachelor of Business in European Business
Management (L7)
Higher Cert. in Business and
Of?ce Management (L6)
BA in Accounting (L8)
BBS Applied Accounting (L8)
?
?
?
?
?
?
Master of Business (L9)
Master of Business
Administration (L9)
H. Dip. in
Business Analysis
and Information
Systems (L8)
MA Accounting (L9)
?
?
?
?
Sligo IT Financial
Services
BBS Financial Services* (L7)
Bachelor of Business [Financial stream] (L8)
?
?
-
Business/
Other
Higher Cert. in Business in Of?ce
Administration (L6)
Bachelor of Business in Of?ce Management
[one-year, add-on] (L7)
Bachelor of Business Administration
[one-year, add-on] (L8)
Bachelor of Business [add-on and full-time] (L8)
Higher Cert. in Business in Accounting (L6)
Bachelor of Business in Accounting
[one-year, add-on] (L7)
Higher Cert. in Business (L6)
?
?
?
?
?
?
?
Master of Arts by
Research (L9)
Master of Business
Administration (L9)
Graduate Diploma in
Business (L9)
?
?
?
Letterkenny IT Financial
Services
- H. Dip Financial
Services Technologies
(L8)
?
Business/
Other
Bachelor of Business (L7)
Bachelor of Business [one-year, add-on] (L8)
BA Administrative Management
[one-year, add-on] (L8)
?
?
?
MA Accounting (L9) ?
Note: All courses listed are degree level and above.
* Programme beginning in academic year 2007/2008.
Source: PwC derived.
International Financial Services 102 International Financial Services International Financial Services
Tables 4.3 and 4.4 above classify the ?nancial services courses delivered by the universities and IoTs into
three areas, namely: ?nancial services; mathematics; and business/other.
Financial services courses include programmes that are dedicated to ?nance, actuarial science,
banking, and investment management. This category also includes joint degrees which combine
?nance with a broader business subject (e.g. BA Accounting and Finance, BSc Economics and Finance)
and business degrees with a ?nance specialism (e.g. Bachelor of Business [?nance stream],
Bachelor Business Studies [economics and ?nance, accounting and ?nance, risk management and
insurance streams]);
Mathematics courses include programmes that cover mathematics, mathematical science, statistics
and other related mathematical based courses; and
Business/other courses include broad business degrees and other ?nance related courses which
provide skills relevant to working in the ?nance sector, such as accounting, economics and business
information systems.
Table 4.5 below contains a list of the ?nancial services related courses delivered by the three training
bodies that we consulted during the interview programme. As the Insurance Institute of Ireland have not
gone through the formal process of rating courses under the NQF framework, their courses are not
assigned an NQF rating.
?
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International Financial Services International Financial Services International Financial Services 103
Table 4.5 Financial services related courses delivered by industry training bodies
Institution Programmes offered
Institute of Bankers Ireland** Recognised Quali?cations: CP14 – Minimum Competency Requirements:
Foundation Cert. in Consumer Credit (L7)
Cert. in Mortgage Practice (L7)
QFA Diploma (L7)
Other Specialist Quali?cations:
Foundation Cert. in Pensions (L7)
Foundation Cert. in Consumer Credit (L7)
Foundation Cert. in Stock Broking* (L7)
Foundation Cert. in Investment Management* (L7)
Foundation Cert. in International Cash Management (L7)
Foundation Cert. and Professional Diploma in Compliance (L7)
Specialist Cert. in Treasury Operations (L7)
Specialist Cert. in Selling Financial Services (L7)
Specialist Cert. in Business Banking (L7)
Specialist Cert. in Investment Fund Services (L7)
Specialist Cert. in Banking Operations (L7)
Specialist Cert. in Asset Finance and Leasing (L7)
Specialist Cert. in Direct Banking Services (L7)
Specialist Cert. in Credit and Lending (L7)
Specialist Cert. in Customer Relationship and Service (L7)
Specialist Cert. in Front Line Management (L7)
Specialist Diploma in Mortgage Practice* (L7)
Specialist Diploma in Front Line Management (L7)
Specialist Diploma in Corporate Banking (L7)
Specialist Diploma in Wealth Management (L7)
Specialist Diploma in Investment Fund Services (L7)
Certi?cate in General Insurance for QFAs* (L7)
The Professional Programme:
Joint Financial Services Diploma (joint quali?cation established
by III, LIA and IoB) (L7)
Bachelor of Financial Services (L8)
Admitting Exam to Certi?ed Banker (L8)
Executive Masters in Risk Management
(jointly delivered with UCD) (L9)
MBA Financial Services (jointly delivered with UCD)* (L9)
Executive MBA Regulation and Compliance
(jointly delivered with UCD)* (L9)
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International Financial Services 104 International Financial Services International Financial Services
Institution Programmes offered
The Insurance Institute of Ireland Insurance Foundation Cert.
Life Administration Certi?cate
Certi?ed Insurance Practitioner Life/General Diploma
in Life Administration
Certi?ed Insurance Practitioner – General and Personal
Medical Insurance
Diploma in Loss Adjusting
Diploma in Life Disability Underwriting
Diploma in Life and Disability Claims
Joint Financial Services Diploma (joint quali?cation established
by III, LIA and IoB)
Advanced Diploma in Insurance
Bachelor of Financial Services (jointly delivered with
UCD and IoB) (L8)
Professional Diploma in Compliance
Cert. in IT for Insurance Professionals
Fellowship (FCII) and Chartered Status
QFA Diploma
Diploma of Insurance Practice
?
?
?
?
?
?
?
?
?
?
?
?
?
?
?
Chartered Financial Analyst Institute Chartered Financial Analyst Programme
Cert. in Investment Performance Measurement
?
?
* Programme beginning in academic year 2007/2008.
** NOTE: In 2006, the Institute of Bankers School of Professional Finance became a recognised school of University
College Dublin.
Source: PwC derived.
Index Index
BA Bachelor of Arts BBS Bachelor of Business Studies
B. Comm Bachelor of Commerce Cert Certi?cate
MA Master of Arts MBA Master of Business Administration
H. Dip. Higher Diploma PhD Doctor of Philosophy
MEconSc Masters of Economic Science QFA Quali?ed Financial Advisor
The tables on the previous pages provide a summary of the education and training programmes hosted by
the universities, IoTs of technology and industry training bodies that were consulted during this study.
To review the provision of ?nancial services education, training and research by the education and research
providers, both in Ireland and internationally, a key step comprised the development of a “framework” for
evaluation of education, training and research. The framework comprises four key criteria to present our
?ndings on ?nancial services education, training and research, namely: course provision; course
development and update; research activity; and industry linkages.
Each area of the framework comprises several sub-criteria under which information on ?nancial services
education, training and research providers is presented. A high-level description of the framework is
provided in the following table, Table 4.6.
International Financial Services International Financial Services International Financial Services 105
Table 4.6 Framework for review of ?nancial services related education, training and research
(Irish and International)
Criteria Aspects reviewed Description
Course Provision Number of ?nancial services
related courses
Number of ?nancial services dedicated courses and
modules; Number of general/related courses such as
business, mathematics, etc; number of faculties/
departments through which courses are delivered; and level
of cross- faculty collaboration.
Accreditation/certi?cation Level of accreditation of courses: Diploma, Degree,
Post-Grad, PhD, other.
Sector focused courses Courses dedicated to speci?c ?nancial services sectors,
e.g. banking, insurance, investment management, etc;
and modules within courses dedicated to ?nancial sectors/
sub-sectors.
Core course focus Course focus on speci?c core areas of ?nancial services,
e.g. general management/business; product development;
?nancial processes; back-of?ce/administration; and
customer-facing role/operations.
National and international
recognition
Recognition of ?nancial services courses (internationally
and nationally), recognised quality standards and
measurement framework.
Course Development
and Update
Flexibility of course/module Extent of ?exibility/process of introducing new
?nancial services related courses/modules; and the
extent of ?exibility/process of updating/changing existing
course modules.
Frequency of course/
module update
Frequency of course/module review – informal and formal;
and drivers of course/module update, e.g. industry trends;
industry feedback; research; quality of graduates; etc.
Mechanisms in place to ensure
industry relevance
Methods used to ensure course content is relevant to
industry requirements/trends and developments, e.g.
internal review of industry trends; informal linkages with
industry; formal industry input.
Cross faculty coordination Level of cross-faculty collaboration in the design and update
of course content, e.g. course development committees/
boards; informal linkages, etc.
Inter-Institutional collaboration Level of inter-institutional collaboration in the development
and update of courses/course content.
Research Activity Drivers of research activity Key drivers of research activity, e.g. industry trends, industry
requests, general research interests, etc.
R&D funding Source of ?nancial services R&D funding.
Level/nature of
research activity
Size/level of ?nancial services related research
undertaken; speci?c focus of the research, e.g. sector,
product, etc; and inter-institutional research
activity (national and international).
Financial services
research centres
Number of dedicated ?nancial services research centres;
scale, focus and funding of research activity; inter-institution
involvement in research centres.
Linking research to
course content
Extent and method by which research ?ndings are linked to
course content/development.
Linking research to industry Extent and method by which research ?ndings are linked
into industry.
International Financial Services 106 International Financial Services International Financial Services
Criteria Aspects reviewed Description
Industry Linkages
percent Collaboration
Design of course content Extent of industry input into course/module design,
e.g. members of course boards, industry boards, etc;
mechanisms used by colleges/universities to ensure
structured industry input.
Delivery of course content Nature and frequency of delivery of courses/
course modules.
Internships/work placements Level and nature of internships/work placements
with industry.
Joint research programmes Extent to which research programmes are undertaken with
industry; nature/extent to which they are jointly funded;
nature of research undertaken; and use of research outputs.
Funding from industry Level of funding from industry, e.g. research, sponsorship of
facilities, student sponsorship, etc.
Other Incubation centres; industry mentoring and sponsorship;
development of executive education courses; and any other
linkages/participation by industry.
In line with the analysis framework presented in table 4.6, feedback from the Irish academic consultations
is provided under the following four headings:
4.1 Course Provision;
4.2 Course Development and Update;
4.3 Research Activity; and
4.4 Industry Linkages/Collaboration
4.1 Course Provision
Table 4.7 below contains details on: the total number of existing courses delivered by the universities, IoTs
and industry bodies interviewed in 2006/2007; the total number of new courses expected to be
introduced between 2007 and 2009; and a breakdown of the broad ?nancial services related courses (e.g.
covering business, accounting, economics, maths, statistics, etc) versus dedicated ?nancial services courses
(e.g. covering ?nance, actuarial science, insurance, banking, etc) for each category.
Following this overview table, a detailed description of the ?nancial services course provision is
presented under the following headings: the number of courses provided; the extent to which these
courses are accredited or certi?ed; the level of ?nancial services sectoral focus contained within the course
content; the nature of the core focus of the courses; and the level of national and international recognition
attained by the courses. Details of each of these are detailed in aggregate for the education institutions
and providers consulted.
International Financial Services International Financial Services International Financial Services 107
Table 4.7 Number of existing and proposed courses delivered by the universities, IoTs and industry
training bodies
Existing ?nancial services
courses ’06/‘07
Proposed ?nancial services
courses ’07-‘09
Total ?nancial services
courses
Education provider Total Broad Dedicated Total Broad Dedicated Total Total
broad
Total
dedicated
Universities 148 113 34 14 2 12 161 115 46
IoTs 42 33 9 2 - 2 4 33 11
Total Uni./IoT 189 146 43 16 2 14 205 148 57
Industry bodies *42 - 42 6 - 6 48 - 48
Total 231 146 85 22 2 20 253 148 105
* Three courses are jointly delivered between IoB and III
(i) Number of ?nancial services related courses
The following points summarise the key ?ndings from the consultations with the Irish education providers,
relating to the number of ?nancial services related courses (refer to Table 4.7 and
Table 4.8 for further detail):
A large number of courses that are either speci?c to, or relevant for, ?nancial services were delivered
by the universities/IoTs/industry bodies interviewed over 2006/2007. A total of 231 courses are
available, of which 147 were delivered by the universities, 42 by the IoTs and 42 by the industry
training bodies;
The vast majority of the courses in the universities and IoTs (146 out of 189 courses or 77 percent) are
broad in nature, covering areas such as business, economics, accounting, statistics and mathematics.
Similar proportions of courses in the IoTs (33 of 42 courses or 79 percent) are broad in nature
compared with the universities (113 of 147 or 77 percent);
The remaining 43 courses in the universities/IoTs are speci?c ?nancial services courses covering areas
such as ?nance, ?nancial mathematics, insurance, banking, corporate ?nance and actuarial science.
A greater number of dedicated ?nancial services courses are delivered by the universities interviewed
(34 out of 43 courses) than the IoTs;
Each of the 42 courses delivered by the industry training bodies are dedicated ?nancial services
courses, focusing on the insurance, banking, investment management and capital markets sectors; and
Over the 2007/2008 and 2008/2009 academic years, 22 additional courses are expected to be
introduced by the universities/IoTs/industry bodies interviewed (14 from the universities, 2 from
IoTs and 6 from industry bodies) bringing the total number of ?nancial services related courses from
231 to 253; 105 of which will be dedicated ?nancial services courses.
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International Financial Services 108 International Financial Services International Financial Services
Table 4.8 Course provision by Irish ?nancial services education and training providers – ?nancial
services related courses
Skills/
research
provider
Number of ?nancial services related courses
Universities Of the seven universities consulted, each university typically provides anything between nine and 47
courses that are either speci?c to, or relevant for, the ?nancial services sector. A total of 147 ?nancial
services related programmes were delivered across the universities interviewed over the 2006/2007
academic year.
The majority of these courses (113 programmes) are broad in nature, covering areas such as:
i. Business studies;
ii. Accounting;
iii. Economics;
iv. Statistics; and
v. Mathematics.
Examples include:
Bachelor of Business and Legal Studies (UCD);
Management Science and Information Systems Studies (TCD);
BA European Business (DCU);
BSc Mathematics (NUIG, NUIM);
BA Mathematical Sciences (UCC, UL);
BA Mathematics (UCC);
BA Mathematical Studies (UCC);
BSc Statistics (NUIM, UCD);
MSc Management Information and Managerial Accounting (UCC);
MA/MBS Accounting (NUIG, DCU);
MSc Modelling and Numerical Computing (UCC);
MSc Mathematical Science (UCD, NUIG);
MSc Statistics (UCD); and
PhD Economics.
The remaining 34 courses are speci?c ?nancial services courses covering areas such as:
vi. Finance;
vii. Financial mathematics;
viii. Actuarial science;
ix. Insurance;
x. Banking;
xi. Capital markets;
xii. Investment and treasury; and
xiii. Corporate ?nance.
Examples include:
BA Actuarial and Financial Studies (UCD);
BA Accounting and Finance (DCU);
BSc Economics and Finance Studies (UCD);
Bachelor of Commerce – banking and ?nance/insurance (UCD);
BA Business Studies – ?nance (DCU);
Business, Economics and Social Studies – ?nance (TCD);
BSc Finance (UCC);
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International Financial Services International Financial Services International Financial Services 109
Skills/
research
provider
Number of ?nancial services related courses
Universities
cont../
Bsc Financial Mathematics and Actuarial Science (UCC);
H. Dip Actuarial Science (UCD);
H. Dip Accounting and Corporate Finance (UCC);
Masters in Risk Management (UCD);
MSc Finance and Capital Markets (DCU);
Grad. Cert. Corporate Treasury (DCU);
MSc Investment and Treasury;
MBS Corporate Finance and Accounting (UCC);
MSc Financial Services (UL);
MSc Actuarial Science (UCD); and
MA Economics and Finance.
Over 2007 to 2009, 14 new courses are expected to be introduced by the universities consulted,
bringing the total number of ?nancial services related courses delivered by the universities up to 161.
Seven of these courses are expected to be introduced in late 2007, of which three are undergraduate
and four are postgraduate programmes. Six of the seven courses are dedicated ?nancial services
courses, namely:
xiv. MSc Computational Finance (UL);
xv. MEconSc International Finance (NUI Galway);
xvi. BSc Financial Mathematics/BSc Actuarial Mathematics (DCU) [this was previously the
BSc Financial and Actuarial Mathematics and is now delivered as two courses];
xvii. Executive MBA in Regulation and Compliance (UCD) [jointly delivered between UCD Smur?t
School of Business and IoB];
xviii. MBA Financial Services (UCD) [jointly delivered with IoB]; and
xix. Structured PhD Programme in Finance (planned Global Finance Academy (GFA), UCD).
The remaining course, an undergraduate programme (BA Business and Management) in NUI
Maynooth is a broad business course.
In 2008, ?ve additional postgraduate courses are expected to be introduced by the universities, four of
which are dedicated ?nancial services courses – the new courses are:
xx. MSc Finance (TCD);
xxi. MSc Quantitative Mathematics (two streams in actuarial studies and ?nancial modelling)
(NUI Galway);
xxii. MSc Equity Analysis (planned GFA, UCD); and
xxiii. MSc Capital Markets and International Finance (planned GFA, UCD).
In addition, NUI Maynooth is developing an MA Accounting programme.
UCD are currently developing the ‘Global Finance Academy’, in partnership with the Institute
of Bankers in Ireland. As a result, four additional programmes are proposed as part of the planned
centre, of which details of three are listed above. A number of these will be jointly delivered with
the Institute of Bankers. The fourth course, a Doctor of Business Administration is currently
in development.
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International Financial Services 110 International Financial Services International Financial Services
Skills/
research
provider
Number of ?nancial services related courses
Institutes of
Technology
The institutes consulted, deliver anything between ?ve and 12 undergraduate and postgraduate
courses each that are either dedicated to, or related to, ?nancial services. With a total of 44 courses
delivered by the IoTs in 2006/2007, a smaller number of ?nancial services courses are provided by the
institutes than the universities.
Similar to the universities consulted, the majority of programmes (33 out of 44 programmes) are
broad in nature, covering areas such as: accounting; business; and of?ce management/administration.
Examples include:
BA Accounting (WIT);
BA International Business (WIT);
Bachelor of Business Studies (WIT, AIT, SIT, LYIT);
BA Administrative Management (LYIT);
Higher Cert. in Business and Of?ce Management (AIT); and
BA General and Corporate Administration (WIT).
The remaining nine courses are speci?c ?nancial services programmes.
The nine courses are:
BA Financial Services (WIT);
Bachelor of Business Studies (Economics and Finance) (WIT);
BA Accounting and Finance (AIT);
Higher Cert. in Business in Financial Services (AIT);
Bachelor of Business in Financial Services (AIT);
Bachelor of Business (Financial stream) (SIT);
MBS (Economics and Finance) (WIT);
PhD Finance (WIT); and
H. Dip Financial Services Technologies (LYIT).
Compared with the universities, there are a much smaller number of ?nancial services related courses
planned to come on stream in the near future. Only two colleges interviewed reported plans to
introduce new courses in the 2007/2008 academic year, both of which are speci?c ?nancial services
programmes, namely:
BA in Finance and Investment (Waterford IT); and
BBS Financial Services (Sligo IT).
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Industry
Training
Bodies
Over 2006/2007, the industry training bodies consulted delivered a total of 42 courses, delivering
anything between two and 25 programmes each. Each of these courses are dedicated/speci?c
?nancial services courses.
Three of these programmes are delivered both by the Institute of Bankers (IoB) and the Insurance
Institute of Ireland (III), namely:
xxiv. QFA Diploma;
xxv. Bachelor of Financial Services (delivered in conjunction with UCD); and
xxvi. Joint Financial Services Diploma.
The III and the IoB however, have developed different streams within these quali?cations, with one
focused on insurance and the other on banking.
Over 2006/2007, the IoB offered 25 individual courses, ranging from certi?cate to degree. These
include a number of specialist and professional programmes designed for those working in banking
and ?nancial services. In 2006, the IoB School of Professional Finance became a recognised school of
UCD, with all IoB courses to be delivered through this School in future.
International Financial Services International Financial Services International Financial Services 111
Skills/
research
provider
Number of ?nancial services related courses
Industry
Training
Bodies
cont../
In late 2007, IoB are introducing six new courses, bringing their total course offering up to 31
programmes, including:
xxvii. Certi?cate in Investment Management;
xxviii. Certi?cate in Stock Broking;
xxix. Specialist Diploma in Mortgage Practice;
xxx. Certi?cate in General Insurance for QFAs;
xxxi. MBA Financial Services; and
xxxii. MBA in Regulation and Compliance.
In particular, the two MBA programmes will be delivered in conjunction with UCD through the
proposed ‘Global Finance Academy’. The MBA in Regulation and Compliance will be delivered in the
IFSC by UCD Smur?t School of Business in partnership with the IoB’s School of Professional Finance
and the MBA Finance will be delivered out of the School of Professional Finance.
The III delivers 15 courses, ranging from certi?cate and diploma to degree courses. The Institute works
in partnership with the Chartered Insurance Institute, which ful?ls the same remit in the UK, to deliver
their courses. The Institute does not have plans to introduce any new courses in the immediate future.
The Chartered Financial Analyst (CFA) Institute is the global, not-for-pro?t association of
investment professionals that awards the CFA and CIPM designations. It delivers two programmes/
quali?cations, namely:
xxxiii. The CFA Programme, which is the global standard for measuring portfolio management and
investment analysis competence. When one signs up for the CFA Program, you become a
candidate. As a candidate, one studies for three exams using an assigned curriculum and take
the three levels of exams sequentially. If one passes all three exams and meets the professional
and ethical requirements, one becomes a CFA charter-holder; and
xxxiv. The Certi?cate in Investment Performance Measurement (CIPM) program is an education and
credentialising program for investment professionals working in performance evaluation and
presentation, and covers: professional ethics; performance measurement, attribution, and
evaluation; and the Global Investment Performance Standards (GIPS) It is a relatively new
course, introduced in 2006.
The CFA Institute has sole responsibility for organising the CFA exams in over 200 countries worldwide.
The course is delivered by distance learning and exams are held locally either once or twice a year.
There are a number of societies worldwide who represent and support CFA candidates. The Society of
Investment Analysts in Ireland (SIAI) is the Irish professional body for those engaged in investment
analysis and portfolio management. The society supports the efforts of CFA candidates by sponsoring a
variety of CFA exam preparation and review opportunities. The society employs FTC Kaplan, a training
?rm that specialises in exam preparatory courses for the CFA exam program, to deliver such review
courses, which are typically held in one week blocks.
Currently there are 168 quali?ed CFA candidates in Ireland. As the CIPM programme was launched in
2006, there are no quali?ed CIPM candidates as of yet in Ireland. It was reported however, that some
interest has been shown in the programme.
International Financial Services 112 International Financial Services International Financial Services
(ii) Accreditation/Certi?cation
The key ?ndings in relation to the level to which ?nancial services related education and training is certi?ed
in the Irish universities/IoTs/training bodies interviewed, are summarised in the points below (refer to
Table 4.9 for further detail):
Of the ?nancial services related courses reviewed in the universities/IoTs/industry bodies, the majority
(137 of 253 courses) are accredited as undergraduate programmes, with the remaining 116 courses
being postgraduate programmes and professional quali?cations (includes both existing and proposed
courses for 2007-2009);
The universities interviewed offer a greater number of ?nancial services related postgraduate
programmes than the IoTs and industry bodies – universities offer 98 (of 166) postgraduate
programmes, whereas 12 (of 42) are available in the IoTs and six are delivered by the industry bodies;
Each ?nancial services related undergraduate course in the universities is accredited to an Honours
Bachelors Degree. By contrast the IoTs and industry bodies have a number of courses accredited as
higher certi?cates, certi?cates and diplomas; and
Of the dedicated ?nancial services courses delivered by the universities and IoTs, 28 of the 58 are
undergraduate courses, with the remaining 30 courses delivered at postgraduate level – the majority of
postgraduate courses are offered by the universities (27 of 30 courses).
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International Financial Services International Financial Services International Financial Services 113
Table 4.9 Course provision by Irish ?nancial services education and training providers –
accreditation/certi?cation
Skills/
research
provider
Accreditation/certi?cation
Universities Across the universities interviewed, the ?nancial services related courses consist of undergraduate
honours bachelor degree courses and postgraduate programmes including a small number of PhD
programmes. Speci?cally:
xxxv. 98 of the 161 ?nancial services related programmes are postgraduate and PhD programmes
(consists of existing and proposed courses 2007-2009); and
xxxvi. The remaining 63 courses are accredited as undergraduate bachelor degrees.
Typically, a similar number of postgraduate and undergraduate courses are delivered in each of the
universities consulted. UL is an exception however, as six ?nancial services related undergraduate
courses are offered, compared with one postgraduate programme.
Undergraduate programmes are typically three to four years in length, with postgraduate programmes
ranging from one to two years and PhDs from three to ?ve years.
Of the 37 dedicated ?nancial services courses delivered by the universities in 2006/2007 (as described
in the previous section (Section (i), number of ?nancial services related courses), 19 are
undergraduate and 18 postgraduate programmes.
Institutes of
Technology
The majority of ?nancial services related courses in the colleges interviewed comprise undergraduate
courses, including Higher Certi?cate and Bachelor Degree programmes. Speci?cally:
xxxvii. 30 of the 44 ?nancial services related programmes are accredited as undergraduate courses
including pass and honours degrees and higher Certi?cate quali?cations (consists of existing
and proposed courses 2007-2009); and
xxxviii. The remaining 14 programmes are postgraduate courses, including 10 Masters, one PhD and
three Higher Diploma programmes.
In contrast with the universities, the majority of courses delivered across the colleges are
undergraduate programmes.
For example, AIT and WIT deliver nine undergraduate and two postgraduate courses each, and Sligo IT
delivers ?ve undergraduate and two postgraduate courses.
Undergraduate programmes range from two to ?ve years, e.g. Higher Certi?cates are typically two
years, ordinary degrees three years and honours degrees over three to four years. Postgraduate
courses are typically delivered over one year and PhDs over three to four years.
In contrast to the universities, of the eleven dedicated ?nancial services courses delivered by the IoTs
in 2006/2007 (as detailed in the previous section (Section (i), number of ?nancial services related
courses)), the majority of programmes (eight) are accredited as undergraduate courses.
Industry
Training
Bodies
The 48 courses delivered by the three industry training bodies consulted cover a range of
quali?cations, including certi?cates, diplomas, degrees, masters, etc (consists of existing and proposed
courses in late 2007). Speci?cally:
xxxix. 41 of the 48 courses are accredited as Certi?cates and Diplomas;
xl. One Bachelor degree is delivered by III and IoB (i.e. Bachelor of Financial Services);
xli. Three Masters quali?cations are delivered by IoB in conjunction with UCD (i.e. Executive Masters
in Risk Management; MBA Financial Services; and MBA Regulation and Compliance); and
xlii. Remaining programmes comprise chartered quali?cations (e.g. chartered ?nancial analysts,
chartered insurance quali?cation).
International Financial Services 114 International Financial Services International Financial Services
(iii) Sector Focused Courses
In this section, the dedicated ?nancial services courses (50 university, 11 IoT, and 48 industry body
programmes, including existing and proposed courses over 2007-2009) (see Table 4.7 for further detail)
as discussed in section (i), are examined, with a view to highlighting the ?nancial services sector focus
(i.e. investment management, banking and capital markets and/or insurance) of each of these courses.
This analysis is detailed in Table 4.10.
Of the 205 courses delivered by the universities and IoTs, 61 of these are dedicated ?nancial
services courses (including existing and new courses expected in 2007/2008 and 2008/2009). A small
number of these courses (16 of 56 or 29 percent) are dedicated to one or more speci?c ?nancial
services sectors;
Seven of the sector focused courses are focused on the insurance sector only (e.g. BA Actuarial and
Financial Studies [UCD], Grad. Cert Actuarial Science [DCU], BA International Insurance and European
Studies [UL]) and seven on the banking and capital markets sector only (e.g. MSc Finance and Capital
Markets [DCU], Grad. Cert Corporate Treasury [DCU]). One course covers all sectors (e.g. Executive
MBA Regulation and Compliance [UCD, starting 2007]) and one course covers the investment
management sector only (i.e. MSc Equity Analysis [UCD]);
Despite the low level of sector dedicated programmes, the remaining broad ?nance programmes
(delivered by both the universities and IoTs and covering areas such as ?nance, business with a
?nance specialism and quantitative ?nance) provide students with the skills to work across almost all
?nancial services sectors at some level; and
The courses provided by the industry bodies interviewed have a high sector focus (e.g. III and IoB
deliver courses focused towards the insurance and banking sectors respectively). The CFA programme,
although offering more general skills, is focused towards the skills needs of the banking and capital
markets sectors.
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Table 4.10 Course provision by Irish ?nancial services education and training providers – sector
focused courses
Skills/research
provider
Sector focused courses
Universities Of the 161 ?nancial services related courses delivered by the universities interviewed, 46 of these
are dedicated ?nancial services courses (this ?gure includes existing and new courses expected in
the academic year 2007/2008 and 2008/2009, see Table 4.7 for further detail). The following table
highlights the sector focus of each of these courses (i.e. focus on investment management,
banking and capital markets and/or insurance). These insights were obtained, both from
consultations with universities and from a review of course curricula.
The majority (30 courses) of the 46 programmes are broad ?nance courses (covering areas such
as ?nance, ?nancial mathematics, business degrees with a ?nance specialism and quantitative
?nance) and provide skills that are relevant to one or more ?nancial services sectors, for example:
xliii. All programmes provide skills which are relevant for the banking and capital markets sector;
xliv. All bar six courses are relevant for investment management; and
xlv. A smaller number (15) are relevant for insurance.
The remaining 16 courses are dedicated to one or more speci?c ?nancial services sectors (e.g.
investment management, banking and capital markets and insurance).
For example:
Insurance (BA Actuarial and Financial Studies [UCD]; BSc Financial Mathematics and Actuarial
Science [UCC]; BA International Insurance and European Studies [UL]);
Banking and Capital Markets (MSc Finance and Capital Markets [DCU]; Grad. Cert. Corporate
Treasury [DCU]; MBS Corporate Finance and Accounting [UCC]); and
Investment Management (MSc Equity Analysis [UCD]).
Across all of the sector focused courses, the following was observed:
xlvi. One course covers all three sectors;
xlvii. One programme solely covers the investment management sector;
xlviii. Seven are solely focused on banking and capital markets; and
xlix. Seven are dedicated to the insurance sector.
Dedicated Financial Services Courses IM BCM INS
Finance Courses:
1. Business, Economics and Social Studies [Finance] (TCD)
2. BSc Economics and Finance (UCD)
3. B. Comm. [Banking and Finance/Insurance] (UCD)
4. Bachelor Finance Services (UCD with IoB, III)
5. BA Accounting and Finance (DCU)
6. BSc Quantitative Finance (DCU)
7. BA Business Studies [Finance] (DCU)
8. BSc Finance (UCC)
9. BSc Financial Mathematics (UL)
10. BBS [Economics and ?nance/accounting and ?nance/risk management
and insurance] (UL)
11. BSc Financial Mathematics and Economics (NUIG)
12. BA Finance and Venture Management (NUIM)
13. BA Finance and Accounting (NUIM)
14. BA Finance (NUIM)
15. MBS Financial Services (UCD)
16. MSc Quantitative Finance (UCD)
17. MSc Financial Economics
18. MSc Financial Services (UL)
19. H. Dip. Finance (NUIM)
20. MA Financial Engineering (NUIM)
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International Financial Services 116 International Financial Services International Financial Services
Skills/research
provider
Sector focused courses
Universities
cont.../
Dedicated Financial Services Courses IM BCM INS
Finance Courses:
21. MA Economics and Finance (NUIM)
22. PhD Financial Economics (NUIM)
23. BSc Financial Mathematics* (DCU)
24. MSc Finance** (TCD)
25. MBA Financial Services (joint between UCD and IoB)*
26. Structured PhD Programme in Finance (UCD)*
27. Doctor of Business Administration (UCD)***
28. MSc Computational Finance (UL)*
29. MEconSc International Finance (NUIG)*
30. MSc Quantitative Mathematics
[stream in Actuarial studies and ?nancial modelling] (NUIG)**
Sector Focused Courses:
1. BA Actuarial and Financial Studies (UCD)
2. BSc Financial Mathematics and Actuarial Science (UCC)
3. H. Dip. Actuarial Science (UCD)
4. MSc. Actuarial Science (UCD)
5. Executive Masters in Risk Management (UCD with IoB)
6. MSc Finance and Capital Markets (DCU)
7. Grad. Cert. Corporate Treasury (DCU)
8. MSc Investment and Treasury (DCU)
9. Grad. Cert. Actuarial Science (DCU)
10. MBS Corporate Finance and Accounting (UCC)
11. H. Dip Corporate Finance and Accounting (UCC)
12. BA International Insurance and European Studies (UL)
13. BSc Actuarial Mathematics* (DCU)
14. Executive MBA Regulation and Compliance (UCD and IoB)*
15. MSc Capital Markets and International Finance (UCD)**
16. MSc Equity Analysis (UCD)**
* Programme beginning in academic year 2007/2008.
** Programme beginning in academic year 2008/2009.
*** Start date unknown.
IM = Investment Management, BCM = Banking and Capital Markets, INS = Insurance.
International Financial Services International Financial Services International Financial Services 117
Skills/research
provider
Sector focused courses
Institutes of
Technology
Of the 44 ?nancial services related courses delivered by the IoTs interviewed, 11 of these are
dedicated ?nancial services courses (including 2 new courses expected in 2007, see Table 4.7 for
further detail). As per the universities, the following table highlights the sector focus of each of
these courses.
Each of the 11 programmes are broad ?nance courses (covering areas such as ?nance, ?nancial
services, and business degrees with a ?nance specialism), without any speci?c sector focus.
Alternatively, based on feedback from consultations with the IoTs and on a review of course
curricula, such broad ?nance courses can provide students with a good grounding in skills
applicable to all areas of ?nancial services [i.e. investment management, banking and capital
markets and insurance], as highlighted in the following table.
Dedicated Financial Services Courses
IM BCM INS
Finance Courses:
1. BA Financial Services (WIT)
2. BBS [economics and ?nance] (WIT)
3. BA Accounting and Finance (AIT)
4. Higher Cert. Business in Financial Services (AIT)
5. Bachelor of Business in Financial Services (AIT)
6. Bachelor of Business [?nance] (SIT)
7. MBS [economics and ?nance] (WIT)
8. PhD Finance (WIT)
9. H. Dip. Financial Services Technologies (LYIT)
10. BBS Financial Services (SIT)*
11. BA Finance and Investment (WIT)*
Sector Focused Courses:
-
- - -
* Programme beginning in academic year 2007/2008.
IM = Investment Management, BCM = Banking and Capital Markets, INS = Insurance.
Industry
Training Bodies
The courses provided by the IoB and III are typically geared towards the skills needs of the banking
and insurance sectors respectively.
Although the programmes provided by CFA provide more general ?nancial services skills, they
are more focused towards the capital markets and investment management sectors than banking
and insurance.
International Financial Services 118 International Financial Services International Financial Services
(iv) Core Course Focus
Feedback on the focus of their ?nancial services related courses was also obtained from the Irish
education and training providers. This was assessed against the skills areas of: general management/
business; back-of?ce/administration; customer facing/operations; product development; and ?nancial
processes. A summary of the key ?ndings are provided below with detailed ?ndings presented in
Table 4.11.
General business courses delivered by the universities and IoTs have a high focus on the provision of
general management/business skills and were also considered to have a high focus on providing skills
to work in both customer facing/operations and back-of?ce/administration roles.
Most of the maths and statistics courses (which are offered only by the universities) are viewed as
having a low focus on the above areas.
Postgraduate/masters courses delivered by the universities (covering areas such as quantitative maths,
?nancial modelling, actuary and risk management) were viewed as having a high focus on product
development and ?nancial processes. In contrast, some of the IoTs considered their undergraduate
?nance and business courses to have a medium to high focus on both product development and
?nancial processes.
Table 4.11 Course provision by Irish ?nancial services education and training providers
– core course focus
Skills/research
provider
Core course focus
Universities As part of the interviews we asked the universities to rate their ?nancial services related courses
(as high, medium or low) against the provision of a number of skills sets/criteria, namely:
General management/business;
Back-of?ce/administration;
Customer-facing/operations;
Product development; and
Financial processes.
It was found that most of the general business courses have a high focus on general
management/business skills. In addition, most of the general business courses were viewed by the
universities interviewed as having a high focus on providing students with skills to work in both
customer facing/operations and back-of?ce/administration roles. In contrast, most of the maths
and statistics courses are viewed as having a low focus on each of these areas.
Postgraduate/masters courses covering areas such as quantitative maths, ?nancial modelling,
actuary and risk management, primarily have a high focus on product development and
?nancial processes.
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Institutes of
Technology
Similar to the universities, we asked the IoTs to rate their ?nancial services related courses against
the same criteria.
As per the universities, it was found that the general business courses have a high focus on general
management/business, customer facing/operations and back-of?ce/administration.
Some of the IoTs interviewed considered some of their undergraduate ?nance and business
courses to have a medium to high focus on both product development and ?nancial processes.
The IoTs interviewed do not deliver any statistical or mathematical courses.
Industry
Training Bodies
The industry training bodies interviewed were not asked to review their courses based on
this criteria.
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(v) National and International Recognition
In terms of the national and international recognition of ?nancial services courses provided by the Irish
education providers interviewed, the following keys trends were highlighted (refer to Table 4.12 below for
further detail):
The universities and IoTs consulted typically do not have formal processes in place to assess how
courses are ranked national or internationally;
To rank undergraduate courses nationally, they primarily rely on course demand via the CAO
course application levels, department ranking and/or graduate employment rates as an indication of
their popularity; and
Furthermore, the universities also rely on formal external rankings of universities (e.g. Financial Times
review) to rate the popularity of their courses.
Table 4.12 Course provision by Irish ?nancial services education and training providers – national/
international recognition
Skills/research
provider
Core course focus
Universities The universities consulted do not have formal processes in place to assess how courses are ranked
national or internationally. To rank undergraduate courses nationally, the universities primarily rely
on course demand via the CAO course application levels, department ranking and/or graduate
employment rates as an indication of their popularity.
In terms of how the institutions as a whole are ranked, the universities rely on formal external
rankings of universities globally.
For example, according to the latest Financial Times Full-Time MBA 2007 ranking, the TCD MBA
programme was ranked 70th globally (the highest ranking achieved by an Irish MBA programme in
2007). The MBA also features in three of the FT Top Ten List categories, namely:
Ranked 2nd globally for Value for Money;
Ranked 7th globally for International Mobility; and
Ranked 7th in Europe for Alumni Salary Levels.
According to the same survey, Smur?t Business School in UCD was ranked 98th overall.
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Institutes of
Technology
As per the universities, the IoTs do not rank courses nationally or internationally. The
colleges typically rely on CAO application levels and graduate employment rates to indicate
national popularity.
Industry
Training Bodies
Based on feedback from our consultations, the industry training bodies interviewed do not
formally rank their courses nationally and/or internationally.
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International Financial Services 120 International Financial Services International Financial Services
4.2 Course Development and Update
The second aspect of programme pro?le relates to the development and update of courses and
incorporates details of: the mechanisms used to update course materials; the level of industry
involvement in determining course content; the extent of collaboration both within and across institutions;
and the ability of the courses to re?ect content changes on a timely basis. Each of these aspects is
considered below, based on the feedback provided from the consultations with education, training and
research providers.
(i) Flexibility of Course/Modules
The consultations highlighted a number of key trends in relation to the Irish education provider’s ?exibility
to change courses/modules, or introduce new courses/modules. A summary of these key ?ndings are
presented below with further detail available in Table 4.13:
The introduction of a new course is typically a complex and lengthy process across the universities and
IoTs interviewed. The development and accreditation process for a new course involves a formal
process, requiring approval from several Councils/Boards. The IoTs however, reported a quicker
timeframe for the introduction of a new course, taking between six and 18 months, compared with one
to three years in the universities;
The universities reported that they are more inclined to introduce a postgraduate course over an
undergraduate, as they can be developed in a shorter timeframe;
Industry training bodies appear to have a less onerous process around new course development – the
development of a programme usually takes between 6 to 9 months; and
In terms of modifying existing course content, the universities and colleges reported that minor changes
or ‘tweaking’ can be made as required without seeking formal approval – minor modi?cations however,
tend to be driven and implemented by the individual lecturer rather than the university/college.
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International Financial Services International Financial Services International Financial Services 121
Table 4.13 Course update by Irish ?nancial services education and training providers – ?exibility of
course/modules
Skills/research
provider
Flexibility of course/modules
Universities Introduction of a New Course
The universities consulted indicated that a new course can usually take between one and three
years to develop and introduce, and usually requires both internal and external approval.
Undergraduate courses usually require two to three years, whereas postgraduate courses can be
introduced in a shorter timeframe, between one to two years.
Many of the universities reported that they would be more inclined to introduce a new
postgraduate course, rather than an undergraduate, due to these timescales. This also re?ects
the government’s plan to focus on the development of a fourth level, embracing both teaching
and research.
For example, the new MSc Computational Finance in UL was designed and approved over a
two year period.
At one university the process of introducing a new course involves several stages of approval,
including internal validation, external accreditation and CAO notice. At another university the
process requires initial ‘Outline Approval’ and subsequent ‘Full Approval’, from the Department,
Faculty and Academic Council.
While it is recognised that the course approval process can be time consuming, a further factor
to the speed and likelihood of introducing a new course is the “availability of staff to deliver
the course”.
Modi?cation of Existing Courses/Modules
Many of the universities consulted indicated that minor changes or “tweaking” of existing course
content/modules can be made as required, without seeking formal approval from the university.
Minor modi?cations tend to be driven and implemented by the individual lecturer rather than the
department as a whole and can happen relatively quickly. Whereas, on the other hand, major
modi?cations of course content must undergo a formal approval process.
For example, DCU is currently awaiting accreditation on two new courses, BSc in Financial
Mathematics and BSc in Actuarial Mathematics (creating two courses from the original BSc in
Financial and Actuarial Mathematics). The process involved both internal validation and external
accreditation and will be offered to students in the latter part of 2007.
International Financial Services 122 International Financial Services International Financial Services
Skills/research
provider
Flexibility of course/modules
Institute of
Technology
Introduction of a New Course
At the IoTs, the introduction of a new course takes in the region of between six and 18 months
from development to introduction.
For example Sligo IT, recently developed a new course starting in 2007 (BBS Financial Services).
The process involved four different stages, namely:
Course development group established within the School of Business;
Review by Department of Business and Humanities;
External Boards; and
Accreditation.
However, some IoTs, including Letterkenny IT, indicated that new courses can be developed and
introduced within six months, if there is suf?cient demand for the course.
Modi?cation of Existing Courses/Modules
It was noted that minor changes can be made to course content without formal institute approval.
Such changes would typically take between three and four months.
For example, Sligo IT can modify up to 20 percent of course content without having to go through
the full formal approval process.
Another example is Waterford IT which continually changes and update their courses to re?ect
industry needs and developments, particularly those of the funds industry. Furthermore, they view
it to be a “relatively easy” process to introduce a new module, which requires approval from the
Faculty, using a peer review mechanism and a review of the module by a panel which includes
industry experts.
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Industry
Training Bodies
Introduction of a New Course
Industry training bodies appear to have a less onerous process around new course development.
Indications from consultations suggest that the development of a programme from the formation
of the initial idea to the provision of a new programme usually takes between 6 to 9 months (and
rarely exceeds 12 months).
This process involves identi?cation of the requirement and assessment of demand, development
of the course, sourcing of staff, and gaining committee approval.
Modi?cation of Existing Courses/Modules
The IoB reported that ‘tweaking’ of existing programmes can occur as a result of the 3 year formal
review process. During this phase the IoB may also decide to add or drop a programme.
(ii) Frequency of Course/Module Update
As a result of consultations with Irish education, training and research providers, the following points in
relation to the frequency of course and/or module update by the Irish ?nancial services education
providers were highlighted (refer to table 4.14 for further detail):
Across the universities and the IoTs interviewed, there appears to be four main mechanisms adopted to
ensure course materials remain relevant and up-to-date, including: periodic university-wide reviews;
formal annual reviews; informal annual reviews; and an on-going review of course content;
The periodic university-wide review is usually conducted every three to ?ve years and consists of a
review of all courses/modules offered by a university/IoT – this presents an opportunity to
fundamentally re-appraise the programme and make major modi?cations as necessary;
Thereafter, universities/IoTs can review course content formally and/or informally on an annual basis.
The formal annual review typically involves a review of content by Course Boards and course materials
can also be informally reviewed as a result of feedback from External Examiners, industry placements
and/or the students themselves;
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International Financial Services International Financial Services International Financial Services 123
A range of review mechanisms are adopted by the industry training bodies also, however these appear
to be primarily centred around reviewing course content annually in conjunction with industry, to
ensure course material remains relevant to industry skills requirements; and
New ?nancial services related modules or changes to existing course content are primarily introduced
in response to staff research projects/interests and industry developments and/or skills requirements.
Changing course content in response to industry requirements is particularly strong in the IoTs
interviewed, as changes to course content are made frequently in response to new skills requirements
of the local ?nancial services industry. Industry trends and developments are also the predominant
driver of course/module change in the industry training bodies consulted.
Table 4.14 Course update by Irish ?nancial services education and training providers – frequency of
course/module update
Skills/research
provider
Frequency of course/module update
Universities Review Processes
Across the university sector a number of mechanisms are adopted to ensure course materials
remain relevant and up-to-date. These mechanisms include:
Periodic university-wide review;
Formal annual review;
Informal annual review; and
On-going review of course content.
The periodic university-wide review is usually conducted every three to ?ve years and consists
of a review of all courses/modules offered by a university. This presents an opportunity to
fundamentally re-appraise the programme and make major modi?cations as necessary.
For example in NUI Maynooth, a formal external audit is undertaken every 5 years
which involves academics reviewing course content and reporting ?ndings back to the
University President.
Thereafter, universities typically review ?nancial services related course content formally and/or
informally on an annual basis. The formal annual review involves a review of content by Course
Boards. Course content may also be informally reviewed as a result of feedback from External
Examiners, industry placements and/or the students themselves.
For example in NUI Galway, courses are formally updated/reviewed every ?ve years. In
addition, individual Course Boards review course content annually and external examiners
offer feedback and suggestions on course material. Individual lecturers also change/‘tweak’
course content as needed.
Drivers of Module/Course Change
New ?nancial services related modules or changes to course content are primarily introduced
in response to staff research projects/interests and industry developments and/or skills
requirements. The feedback received from industry is both formal and informal.
In particular, UCD indicated that “industry needs are at the forefront of course
development”. In support of this, DCU noted course development is driven by the needs
and trends of the market and speci?c industry requirements.
Furthermore, UL stated that after the ?rst year of their MSc Financial Services,
course content was updated immediately based on student feedback and recent
industry developments.
Other factors requiring course changes, identi?ed by the universities, include new
education standards/provision, exam results and regulatory and policy trends. In addition,
changes to professional exams (e.g. accounting and actuarial) may require changes to related
course content.
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International Financial Services 124 International Financial Services International Financial Services
Skills/research
provider
Frequency of course/module update
Institute of
Technology
Review Processes
Across the IoTs interviewed, similar review mechanisms were noted. As with the universities,
they included:
Periodic institute-wide reviews; and
Formal and informal annual reviews.
The colleges typically conduct the periodic formal review every four/?ve years.
For example, the ‘Quality Assurance’ scheme in Sligo IT involves both rigorous internal and
external evaluation across all courses and also of the structure and facilities of the institute.
They also conduct a formal programme review every three to four years.
As per Sligo IT, the entire institute in Athlone IT is reviewed under the ‘Quality Assurance’
process. Thereafter, courses are formally reviewed every ?ve years. Waterford IT formally
reviews all courses every four years, which involves an external review in addition to industry
involvement in updating course content. Letterkenny IT formally reviews all courses every ?ve
years under a ‘Periodic Programme Review’ – all courses were re-evaluated/validated over the
past year under this system.
Thereafter, universities typically review ?nancial services related course content formally and/
or informally on an annual basis.
For example, in Sligo IT, each course has a ‘Course Board’ which comprises lecturers,
the course co-ordinator and students. The board meets regularly throughout the
College year.
In Waterford IT, course content is also reviewed annually based on feedback from students
and work placements. An ‘Industry Advisory Board’ informs the Business School on current
industry skills requirements and trends. Courses are reviewed annually thereafter, as a result
of feedback from external examiners and informal discussions with industry.
In Athlone IT, courses are reviewed on an annual basis either formally and/or
informally, through feedback from graduate surveys, course committees and recent
industry developments.
Drivers of Module/Course Change
The key drivers of module/course change are industry skills requirements, trends
and developments.
For example, one of the main drivers of change for the ?nancial services courses offered by
Waterford IT is the growing fund administration industry in South East Ireland. Working
collaboratively with industry, Waterford IT have developed and tailored their course to meet
the local industry’s skills requirements.
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International Financial Services International Financial Services International Financial Services 125
Skills/research
provider
Frequency of course/module update
Industry Training
Bodies
Review Processes
Across the industry training bodies reviewed a range of different mechanisms are adopted to
ensure course materials remain relevant and up-to-date, including:
Formal periodic reviews;
Annual review; and
Ongoing informal reviews.
Some of the industry bodies conduct a periodic formal review.
For example, the IoB conducts a formal 3 year review of all quali?cations offered.
Thereafter, industry training bodies can review course content on an annual basis.
For example, in the CFA Institute, the CFA Program curriculum is updated annually on a global
level and is based on a rigorous practice analysis process, which involved the following steps:
The Institute solicits input from and surveys current investment practitioners and other
experts in order to maintain a Global Body of Knowledge™ (GBOK) that is the
comprehensive outline of mainstream knowledge for the investment profession;
This body of knowledge is further distilled to determine the body of knowledge for a new
charterholder (termed the Candidate Body of Knowledge (CBOK)), which is a subset of
the GBOK. The CBOK represents the knowledge required for a relatively new generalist
practitioner in the investment profession; and
Based on the CBOK the CFA Institute staff and volunteers ?nd best-in-class readings or
commission the writing of such readings.
In addition, the III formally reviews all modules annually. Each module (approximately 25/30
modules across the 15 courses delivered by III) has a dedicated industry advisory panel,
comprising circa ten industry representatives who review module contact annually – feedback
from the industry panel is incorporated by the textbook writers into course material.
Industry training bodies can also conduct informal reviews of course content continuously
throughout the year.
For example, the IoB hold regular informal meetings with chief executives of ?nancial
institutions to discuss industry needs/gaps and review course content and also have
continuous informal collaboration with the Irish Bankers Federation and the Regulator.
Drivers of Module/Course Change
The key drivers of module/course change are industry skills requirements and recent trends
and developments.
For example, the IoB receives corporate input into the development of their programmes
through its Council, which includes domestic and international industry representatives.
Programme additions and modi?cations are made in response to market trends or issues. The
Quali?ed Financial Advisor (QFA) programme for example, was developed in response to a
requirement by the Regulator for people working in certain aspects of the ?nancial services
sector to meet minimum competency levels.
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(iii) Mechanisms in Place to ensure Industry Relevance
A number of key processes to keep courses in line with industry trends and developments were
identi?ed in the universities/IoTs/industry bodies interviewed (refer to Table 4.15 for further detail):
The mechanisms for ensuring courses are kept up-to-date with industry developments are
predominantly informal in nature for both the universities and IoTs – however, a small number
of education providers utilise formal mechanisms for ensuring courses remain relevant to
industry requirements;
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International Financial Services 126 International Financial Services International Financial Services
Informal mechanisms consist of: informal contact through individual personal networks; university
alumni; and linkages with industry through student work placements, industry conferences and
informal discussions/meetings with industry. In particular, a number of the IoTs interviewed, hold
regular discussions with industry to ensure the course content of a number of their ?nancial services
courses meet the skills requirements of the local industry;
To a lesser degree, some evidence of formal mechanisms was found in two of the universities/IoTs
interviewed, which involves the inclusion of industry representatives on course/department boards,
thus receiving direct input from industry in the design/review of course content; and
Conversely, the industry training bodies appear to meet with industry on a formal basis more regularly
than the universities and IoTs – this can involve formal feedback from industry on course content
through meetings, industry advice and periodic industry surveys.
Table 4.15 Course update for Irish ?nancial services education and training providers – mechanisms
for industry relevance
Skills/research
provider
Mechanisms in place to ensure industry relevance
Universities The universities consulted reported varying levels of contact with industry to inform course
content. This contact can be categorised into:
Informal contact through individual personal networks, student work placements and
industry conferences, etc; and
Formal contact through industry involvement on course boards, face-to-face
meetings, etc.
The university sector predominantly relies on informal linkages with industry to keep
courses up-to-date with ?nancial services trends and developments. This contact includes
informal discussions/meetings and liaison with personal contacts in the sector. In
particular, some universities cited contacts with university alumni as a frequent source of
industry liaison.
For example, in TCD, they have developed informal links with a number of leading ?nancial
services institutions, e.g. Pioneer, Irish Life and Allianz. NUI Galway also reported that they
informally meet with industry at various ?nancial services related conferences.
In UCC, during the design of the ‘BSc Financial Mathematics and Actuarial Science’, UCC
met with a number of actuary ?rms (e.g. Mercer, Irish Life) to discuss industry relevance of
course content.
Some universities however, formally include industry representatives on course boards or
in some cases, have developed Industry Advisory boards for the university.
In UCC for example, the Business Information Systems Department has an ‘Advisory
Business Board’ which advises the Department on important industry trends and makes
suggestions on future course content. This Board includes representatives of Bank of
Ireland and government departments, amongst others.
Many of the universities commented that although some level of collaboration with
industry is apparent, there is a need for a more formal collaboration to synchronise course
content with industry developments. In addition, time was cited as being a major constraint
in the strengthening of industry linkages.
For example, DCU believed there is potential to collaborate with industry further, however
it requires effort from both industry and academia to ensure this happens.
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International Financial Services International Financial Services International Financial Services 127
Skills/research
provider
Mechanisms in place to ensure industry relevance
Institutes of
Technology
Similar to the universities, the IoTs interviewed primarily use both informal linkages
with industry as a means to synchronise course content with recent industry developments.
For example, it appears from consultations with IoTs that they hold regular informal
discussions with local industry to ensure that their ?nancial services courses meet their
skills requirements.
For example, the ?nance courses in Waterford IT are geared towards the skills needs
of the funds administration industry in the South East. Furthermore, the H. Dip in
Financial Services Technologies in Letterkenny IT was developed speci?cally in response
to a demand by Primerica and Northbrook Technologies for students with skills in
mainframe programming.
Although primarily informal in nature, some evidence of formal processes to include
industry on course boards was found.
In Waterford IT for example, an industry advisory board or the ‘Advisory Forum for
Management Education’ advises the Business School on industry developments and future
course content.
Industry Training
Bodies
In contrast to the universities and IoTs, the industry training bodies appear to meet with
industry on a more formal basis more regularly to ensure industry relevance of course
content – this can involve formal feedback from industry on course content through
meetings and periodic surveys.
For example, the IoB regularly consults with industry to ensure that their education offering
is relevant and up-to-date. This is conducted through both the informal meetings with
Chief Executives as well as feedback from their members the majority of which are
employed within the ?nancial services sector. In addition, the IoB has 50 Corporate
members including the major domestic and international banks and Irish Building Societies
– this helps ensure the programmes are addressing the needs of the sector.
In addition, the CFA Institute annually solicits input from and surveys current investment
practitioners and other experts in order to maintain a Global Body of Knowledge that is the
comprehensive outline of mainstream knowledge for the investment profession.
Furthermore to ensure industry relevance of course content, each module delivered by the
III is reviewed annually by an industry advisory panel, comprising circa ten industry
representatives. Feedback from the industry panel on course content is then incorporated
by the textbook writers into course material (as outlined in Section (ii) above).
International Financial Services 128 International Financial Services International Financial Services
(iv) Cross Faculty Coordination
The following points summarise the feedback gathered in relation to the level of cross-faculty
coordination in the design and delivery of courses by the Irish education and training providers
interviewed. Further detail and examples are provided in Table 4.16.
The universities and IoTs interviewed typically have a relatively low level of, or no, structured
cross-faculty coordination.
Informal contacts between faculties/departments are more commonplace and regular, consisting of
ad-hoc discussions between Faculties/Departments – albeit such discussions can be general in nature
and may not be speci?cally related to course development.
Although not as common, some evidence of formal collaboration to promote cross-faculty
coordination was found in three of the universities interviewed. This primarily consists of the inclusion
of a cross-selection of staff from the mathematics, ?nance, and/or economics department as members
of a course board.
There was little evidence of formal cross-faculty coordination in the IoTs consulted – this is
predominantly due to the fact that ?nancial services programmes are delivered by the School/
Department of Business only (as the IoTs interviewed do not offer mathematical or statistical
based courses).
Table 4.16 Course update for Irish ?nancial services education and training providers –
cross faculty coordination
Skills/research provider Cross-faculty coordination
Universities Cross-faculty coordination in the design and delivery of ?nancial services courses/modules
is both formal and informal in nature across the universities consulted.
Formal collaboration is evident during the development and/or design of a cross-faculty
delivered course.
For example, in DCU, the School of Mathematics and the School of Business are jointly
involved in the design and delivery of the BSc Quantitative Finance. A selection of
course boards in UL are interdisciplinary, including representatives from the Economics
and Mathematics Departments, which have responsibility for reviewing course content
annually. Lecturers in UCD can be selected from outside a Faculty to deliver certain
modules based on their area of specialism/skills.
In respect of informal collaboration, this consists of ad-hoc discussions between Faculties/
Departments – these discussions can be general in nature and may not be speci?cally
related to course development.
Institute of Technology There was no evidence of formal cross-faculty coordination in the IoTs consulted.
This is typically due to the fact that ?nancial services programmes delivered across the IoTs
interviewed are business based (e.g. Bachelor of Business Studies, BA Finance, etc), and
don’t include mathematical or statistical based courses, which are typically delivered by a
School of Mathematics in the universities. As a result, the School/Department of Business
in the IoTs consulted are responsible for designing and delivering course content.
Industry Training
Bodies
This area was not applicable to the industry training bodies interviewed.
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International Financial Services International Financial Services International Financial Services 129
(v) Inter-institutional Collaboration
The key ?ndings in terms of the level of inter-institutional collaboration in the design and delivery of
courses are summarised in the points below:
Of the universities and IoTs consulted, there were no reports of inter-institutional collaboration in
relation to the design and/or delivery of ?nancial services related courses/course content; and
In contrast, it was found that the industry training bodies collaborate with several universities when
designing and delivering course content (refer to Table 4.17 for further detail).
Table 4.17 Course update for Irish ?nancial services education and training providers –
inter-institutional collaboration
Skills/research
provider
Inter-institutional collaboration
Universities Of the universities consulted, there were no reports of inter-institutional collaboration in relation to
the design and/or delivery of ?nancial services related courses/course content.
However there was evidence of collaboration between universities on ?nancial services research
activity – this will be discussed in greater detail in Section 3 of this chapter.
Institute of
Technology
As found in the universities, there were no reports of inter-institutional collaboration in the design
and/or delivery of course content in the IoTs consulted.
Industry
Training Bodies
There is strong evidence in the industry training bodies interviewed, of the design and delivery of
course content with other institutions.
For example, the IoB collaborate extensively with UCD in the development of a number of
Diplomas, Masters and MBA programmes. The III is also partnering with the IoB and UCD in the
delivery of the Bachelor of Financial Services.
Furthermore, the IoB has recently established the ‘School of Professional Finance’ which is a
recognised school of UCD. Through this relationship UCD will award Degrees, Postgraduates and
Doctorates to IoB’s members. The IoB are also partnering with UCD in the development of the
planned ‘Global Finance Academy’ (GFA). IoBs role will be to assist in the development of ‘high-
level, world-class’ programmes as a result of research undertaken within the Academy and also to
ensure that ?ndings are fed back into industry.
Universities around the world have integrated CFA Institute’s CBOK into their courses and use
curriculum materials developed by the CFA Institute. The CFA Institute assists universities that
desire to use the CBOK or GBOK by providing copies of the curriculum material, examples of
textbooks covering CBOK topics and examples of course syllabi and programs developed. The
Institute also has a ‘Program Partners Initiative’, which is a partnership with leading universities
around the world who integrate their body of knowledge (including Ethics and Professional
Standards), and serve as role models for other universities (e.g. Oxford and LBS).
4.3 Research Activity
Table 4.18 overleaf contains: an overview of the number of faculty members involved in ?nance research;
details of ?nancial services research centres; and the nature of the research focus of each of the
universities interviewed. The IoTs are not included in this table as apart from Waterford IT, the IoTs
consulted are not active in ?nancial services research.
Following this overview table, a detailed description of the ?nancial services research activity is presented
under the following six headings: drivers of research activity; sources of R&D funding; the level and nature
of research activity; ?nancial services research centres; linking research back into course content; and
linking research back into industry. Details of these aspects of ?nancial services research activity are
outlined for each of the education and training providers consulted.
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International Financial Services 130 International Financial Services International Financial Services
Table 4.18 Summary of research activity in the universities and IoTs interviewed
College Number of
full-time
academics
Research centres
involved in
?nance
research
Centre Research focus/Research themes
Trinity
College
Dublin
4 International Financial Integration
Project (INFINITI)
Research areas are the following:
Dynamics of international ?nancial integration.
Role and nature of multinational companies
in international integration.
Globalisation of both ?nancial
product markets and the in?uences on
?nancial products.
Role of national socioeconomic conditions on
portfolio investment.
International MandA.
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Centre of Dynamics of Global
Business* [launch date not known]
Research will be focused on the process side of
business – one element of this will be ?nancial
services process management.
University
College
Dublin
15 Centre for Financial Markets Risk management.
Asset pricing.
Asset/wealth management.
Finance for SMEs and VCs.
Corporate ?nance.
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National Computing Research and
Application Group
Asset management.
Risk management.
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Centre of Insurance Studies Private medical insurance.
Actuarial studies.
Pension fund performance evaluation.
Ageing populations.
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Global Finance Academy* [in ?nal
stages of development]
GFA research is proposed to be developed around
six broad research themes, namely:
Asset management;
Risk management;
Insurance and risk;
Corporate ?nance;
Behavioural ?nance; and
Policy (including regulation and taxation).
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Dublin City
University
8 Centre for Quantitative Finance
(Launching November 2007)
Econometrics, i.e. ?nancial markets.
Statistical analysis.
Inef?cient market – liquidity/credit risk.
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International Financial Services International Financial Services International Financial Services 131
Dublin City
University
Centre for Investment Research
(delivered jointly with, and based
in, UCC)
Research areas include:
Asset management (performance and risk
measurement in national and international
hedge funds, mutual funds and pension
funds); and
Asset pricing, investment strategies, global
market integration and risk management.
The Centre also aims to make an important
contribution to the current policy issue in Ireland
of future pension funding.
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Centre for Financial Mathematics*
(virtual centre delivered jointly
with UCC) [provided funding is
obtained, launch expected
early 2008]
Proposed areas of research include:
Financial mathematical modelling;
Option pricing;
Quantitative Risk Management;
Hedging; and
Financials and actuarial product development.
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UCC Not
available
Financial Services Innovation
Centre (launched in
February 2007)
The Centre aims to:
Provide a resource for global ?nancial
services companies to participate in
innovation and the development of leading
software solutions; and
Allow participants to share information and
expertise, while also keeping in touch with the
latest development in the ?nancial services
software market.
Key research areas identi?ed to date are:
Regulation and compliance;
Knowledge management/decision support;
Financial services for the elderly;
Risk management;
Delivery strategy;
Security and fraud; and
Straight through processing.
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Centre for Investment Research
(based in UCC – delivered in
conjunction with DCU)
See DCU
Centre for Financial Mathematics*
(virtual centre delivered jointly
with DCU) [provided funding
is obtained, launch expected
early 2008]
See DCU
UL 8 - Quantitative Finance.
Credit Risk/Compliance.
Derivatives.
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NUIG 5 - International Finance.
Computation Finance.
Financial Econometrics.
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NUIM 5 - Speci?c to the individual researcher
WIT 8 - Mergers and acquisitions.
Small ?rm ?nance.
Relationship banking.
Pensions funds investment and management.
Financial economics.
Corporate governance.
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* Financial Services Research Centre not yet established. Note: Information is limited to the universities and one IoT, as
research is not undertaken by any other of the IoTs interviewed.
International Financial Services 132 International Financial Services International Financial Services
Examples of research papers under the research areas outlined in Table 4.18 above are provided in Table
4.21 later in this section.
(i) Drivers of Research Activity
A summary of the key drivers of research activity are presented below with further detail found in Table
4.19 below:
The main drivers of research activity across the universities consulted are: individual lecturer research
interests; and industry developments/issues; and
Only one of the industry bodies consulted is research active at present. The key driver of this research
activity is industry trends and developments.
Table 4.19 Research activity by the Irish ?nancial services education and training providers – drivers
of research activity
Skills/research
provider
Drivers of research activity
Universities As a result of consultations with the universities, there appears to be two key drivers of research
activity, namely:
Personal interests; and
Industry developments/issues.
The universities with ?nancial services research centres are typically conducting research which is
more industry driven.
For example, the research conducted in the ‘Centre for Financial Markets’ in UCD is undertaken in
response to industry research requirements/needs – research areas include: risk management;
asset pricing; wealth management; ?nance for SMEs and VCs; and Corporate Finance.
In contrast, it appears that in some universities research topics are determined by an individual
area of personal interest, however industry relevance is always a consideration:
“Personal interests largely drive research. It is not purely driven by industry, however all
research is applicable to industry interests... the two are very much intertwined”
[source: university interviews]
However, it was noted that regardless of what drives individual research projects, it is important
that a high focus on academic rigour is maintained:
“Although research is primarily industry driven, it is very important to retain the academic focus of
the research”
“To compete with the top Universities, it is essential to have a focus on academically respected
research” [source: university interviews]
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Institutes of
Technology
Of the IoTs interviewed, Waterford IT is the only IoT conducting ?nancial services research
at present.
As per the universities, Waterford IT noted that personal research interests were a strong driver of
?nancial services research activity.
Industry
Training Bodies
Of the three industry bodies interviewed, the CFA Institute is the only body which conducts
research. However, this research which in conducted through two research centres is primarily
conducted in the US (both Centres are located in Charlottesville) and not in Ireland. However, in
relation to the drivers of this research activity, ideas are generated by practising members and
advisory boards consisting of practising investment professionals.
Although the IoB is not currently involved in any research activities, through their association with
the proposed UCD ‘Global Finance Academy’, which will be heavily focused on conducting ‘world
class’ research, they hope to become more active in this area in the future.
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International Financial Services International Financial Services International Financial Services 133
(ii) R&D Funding
Funding for ?nancial services research and development is received from a combination of different
sources, as outlined below:
Universities reported receiving funding from a combination of different sources, including: Irish
Government/State Bodies (e.g. PRTLI, SFI, EI, IDA); the EU (e.g. FP7 Brussels); the University (including
inter-institutional funding); and Industry – however, funding from industry was found to be limited;
It was the opinion of a number of the universities interviewed that the growth of ?nancial services
research has been hugely limited by the lack of available funding;
In particular, the cost of purchasing data for ?nancial services research is considered an enormous
expense for Irish research providers;
It was also considered that there is a “disconnect” between the importance that the Irish Government
attaches to ?nancial services research and the actual funding that its makes available; and
Research conducted by the industry training body interviewed, is primarily funded by the students
themselves and the corporate members of the body (further detail in Table 4.20 below).
Table 4.20 Research activity by the Irish ?nancial services education and training providers –
R&D funding
Skills/research
provider
R&D funding
Universities Universities reported receiving funding from a combination of different sources of funding,
including the following:
Irish Government/State Bodies (e.g. PRTLI, SFI, EI, IDA);
EU (e.g. FP7 Brussels);
University (including inter-institutional funding); and
Industry.
It is dif?cult however, to quantify the level of ?nancial services funding awarded to a university, as
research funding can be obtained from multiple sources by several Departments/lecturers.
It was reported that the cost of conducting ?nancial services research is typically lower
than other sectors such as science and technology. The primary cost associated with ?nancial
services research is the purchase of/access to data, and is viewed as a considerable expense
for universities.
For example, UL stated that a licence to data may cost circa €25,000 per year, while TCD reported
that access to the particular data they required was $280,000 per annum.
It was the opinion of a number of the universities interviewed that the growth of ?nancial services
research has been hugely “frustrated”/limited by the lack of available funding, with one university
stating that “we have ambitions to grow PhD numbers but it is impossible without funding”
[source: university interviews]. It was also considered that there is a “disconnect” between the
importance that the Irish Government attaches to ?nancial services research and the actual funding
that its makes available:
“There is a big disconnect between what the Government say about providing ?nance to support
the sector and what is actually provided” [source: university interviews]
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Institutes of
Technology
Waterford IT cited they receive a small amount of funding from industry.
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International Financial Services 134 International Financial Services International Financial Services
Skills/research
provider
R&D funding
Industry
Training Bodies
The CFA Institute indicated that projects are funded from revenue from the students themselves
and the corporate members of the Institute. Research Foundation funding also comes from
contributions from industry. The CFA Institute Centre budget is proposed annually by Management
and endorsed by the Board of Governors. The Research Foundation of CFA Institute receives
ongoing funding support from two sources, CFA Institute and an annual distribution from the
Research Foundation Endowment. The Endowment comes from donations made by investment
professionals to support research. The IoB envisage that ?nance for joint industry/academia
research projects undertaken within the ‘Global Finance Academy’ will be part-funded by industry.
“...?ndings of research conducted will be of bene?t to the ?nancial services industry and therefore
you would expect a level of funding from them” [source: industry body interviews]
(iii) Level and Nature of Research Activity
A summary of the level and nature of research activity undertaken by the Irish education providers
interviewed is presented below:
The universities and the one IoT involved in research have between ?ve and 15 faculty members who
are involved in undertaking ?nancial services related research;
Speci?c research areas were found to vary across the universities and IoTs. However, a number of broad
research themes emerged, covering the three areas of: risk management; asset management; and
corporate ?nance;
In addition, different forms of ?nancial modelling appear regularly as research themes in the universities
interviewed, including: asset pricing; econometrics; option pricing; and derivatives; and
There has recently been an increase in processing and systems research, with two universities planning
to launch/have launched a research centre with a focus on these research areas (refer to Table 4.21 for
further detail).
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International Financial Services International Financial Services International Financial Services 135
Table 4.21 Research activity by the Irish ?nancial services education and training providers – level/
nature of research activity
Skills/research
provider
Level and nature of research activity
Universities Table 4.18 (summary of research activity in the universities and IoTs interviewed) provides
an overview of the level and nature of ?nancial services research activity in each of the
universities interviewed.
The universities consulted have between ?ve and 15 faculty members who are involved in
undertaking ?nancial services related research. UCD has the largest compliment with 15 full-time
faculty members, almost twice that of DCU and UL, both of which have 8 faculty members. All
remaining universities indicated that they have ?ve full-time faculty members who are involved in
undertaking ?nancial services research.
A number of the universities reported that it was dif?cult to scale up the level of research activity
as the majority of graduates tend to go into industry and not continue in academia. As a result
industry is reportedly conducting its own credible research, for which they have “the time and
money to do so” [source: university interviews]. Consequently, academia is competing with
industry in this respect.
The level of research activity is primarily dependent on the scale and research capacity of the
university. For example, universities with a larger research capacity were more likely to have
dedicated ?nancial services research centres (further detail on research centres found in the
following section (iv) Financial Services Research Centres).
In addition to dedicated research centres, research that is speci?c to individual researchers is also
conducted across the universities interviewed.
For example, in UL and NUI Maynooth research themes vary by individual lecturers (e.g. one
lecturer focuses on portfolio selection models and ?nancial integration). In UL, ?nancial
services research is centred around three main areas.
Speci?c research areas were found to vary across the universities. However, based on a review of
the ?nancial services research activities of the universities interviewed, a number of broad research
themes emerged, covering three key areas, namely:
Risk management (e.g. “Developing ways of measuring risk, and comparing these risk
measures”, DCU; “Computational simulation of theoretical models of pricing, markets and risk”,
DCU; “Extreme Spectral Risk Measures: an Application to Futures Clearinghouse Margin
Requirements”, UCD);
Asset management (e.g. “The Case for REITs in the Mixed-Asset Portfolio in the Short and Long
Run”, UCD; “Empirical asset return distributions. Is chaos the culprit?” UCD); and
Corporate Finance (e.g. “UK Stock Returns and the Impact of Domestic Monetary Policy
Shocks”, UCD; “Dynamics of equity market integration in Europe: impact of political-economy
events”, UCD; “Risk, Strategy, and Optimal Timing of MandA Activity”, TCD; “Europe’s External
Monetary and Financial Relations since the Euro: A Reconnaissance and a Proposal”, NUIG).
In addition, different forms of ?nancial modelling appear regularly as research themes in the
universities interviewed, including:
Asset pricing;
Econometrics;
Option pricing; and
Derivatives.
UCC have a particular focus on processing and systems research through their ‘Financial Services
Innovation Centre’ – this is also an emerging theme which is proposed for the upcoming ‘Centre
of Dynamics for Global Business’ in TCD.
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International Financial Services 136 International Financial Services International Financial Services
Skills/research
provider
Level and nature of research activity
Institutes of
Technology
Details on the level and nature of research activity for each institute are limited to Waterford IT.
The college has eight lecturers/researchers dedicated to ?nance. In addition, they are hoping to set
up a centre in ?nancial services by developing their course offering (new BA Finance and
Investment in 2007) and existing research capacity going forward. Research areas include:
Mergers and acquisitions;
Small ?rm ?nance;
Relationship banking;
Pensions funds investment and management;
Financial economics; and
Corporate governance.
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Industry
Training Bodies
As mentioned previously, the only industry training body conducting research at present is the CFA
Institute, through the establishment of two research centres, namely:
The CFA Institute Centre for Financial Market Integrity and;
The CFA Institute Research Foundation.
Firstly, the mission of the CFA Centre for Financial Market Integrity is to be a leading voice on
issues of fairness, ef?ciency, and investor protection in global capital markets and to promote high
standards of ethics, integrity and professional excellence within the investment community. The
Centre consists of over 20 staff members supported by numerous volunteer committees around
the world.
The Research Foundation’s mission is to encourage education for investment practitioners
worldwide and to fund, publish, and distribute relevant research. The Foundation emphasizes
research of practical value to investment professionals, while exploring new topics that provide a
unique perspective in the rapidly evolving profession of investment management. Products include
monographs, literature reviews, webcasts and papers.
Although not currently in place, the IoB have plans to introduce a number of Doctoral programmes
for individuals working in industry. The research undertaken as part of these programmes will be
driven by industry and the IoB have already initiated discussions with various banks in relation
to this.
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(iv) Financial Services Research Centres
Some of the education and training providers have established dedicated ?nancial services research
centres. The nature of these centres and the research activities undertaken at each centre is described
below, with further detail available in Tables 4.22 and 4.18:
Five of the seven universities interviewed have established dedicated ?nancial services research centres;
Further to the existing centres, some universities are planning the introduction of a number of new
?nancial services research centres, including the ‘Global Finance Academy’ in UCD, a joint initiative
between UCC and DCU in the establishment of the ‘Centre for Financial Mathematics’ and a ‘Centre of
Dynamics of Global Business’ in TCD; and
At industry training body level, one of the training bodies is research active and has established two
research centres in the USA through which all research is conducted.
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Table 4.22 Research activity by the Irish ?nancial services education and training providers –
research centres
Skills/research
provider
Financial services research centres
Universities Five of the seven universities interviewed have established dedicated ?nancial services research
centres. A selection of these include the following:
UCD has a number of research centres/groups dedicated to ?nancial services, including ‘Centre
for Financial Markets’ and ‘Centre for Insurance Studies’;
DCU recently developed the ‘Centre for Quantitative Finance’ – a joint initiative between the
School of Business and School of Mathematics;
UL recently launched the ‘Financial Services Innovation Centre’ – which focuses on developing
and producing new innovative products and services and actively engaging with companies.
Although the Centre will initially focus on IT/IS perspectives, colleagues from Economics,
Finance, Electrical Engineering, Law and Financial Maths will also be included; and
The ‘Centre for Investment Research’ was established in January 2007 and comprises
researchers from UCC, Cass Business School and DCU. The aim of the centre is to be a focal
point for international investment research – which is of direct relevance to industry.
Further details on the ?nancial services research centres can be found in Table 4.18.
In addition to the existing centres, some universities plan to introduce of a number of new
?nancial services research centres.
For example, UCD are in the process of developing the ‘Global Finance Academy’ in association
with the Institute of Bankers, which will focus on both ?nance-related training and research. The
Centre will comprise some thirty faculty members and aims to have strong links to industry and
universities in Ireland and in other countries. In addition to covering the primary areas of ?nance
education and research, it will focus on niche areas of relevance to the development of the
?nancial services industry in Ireland.
Furthermore, UCC and DCU are co-developing the ‘Centre for Financial Mathematics’. This will be a
‘virtual centre’ operating from both universities. Provided funding is successfully obtained from SFI,
the Centre should be operational in early 2008.
TCD are in the process of developing a ‘Centre of Dynamics of Global Business’ – research
will be focused on the process side of business of which one element will be ?nancial services
process management.
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Institutes of
Technology
At present, none of the IoTs interviewed have established any dedicated ?nancial services
research centres.
Industry
Training Bodies
This section is not applicable for the IoB and III. However, as described in Section (iii) above, the
CFA has two research centres based in Charlottesville in the US. They are:
The CFA Institute Centre for Financial Market Integrity; and
The CFA Institute Research Foundation.
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International Financial Services 138 International Financial Services International Financial Services
(v) Linking Research to Course Content
In terms of the Irish industry bodies and research providers consulted linking research to course content,
the following was found:
Both universities and IoTs reported that research is typically fed back to students through course
content/material and class discussions, however the frequency and use of research material in speci?c
modules is largely left up to the individual lecturer;
The universities noted that the incorporation of research into class material/discussions is more likely
to happen at postgraduate level due to the often complex nature and more speci?c focus of the
research; and
One of the industry bodies reported that research is incorporated into course content if the topics
researched are relevant to the course content in their educational programmes (refer to Table 4.23 for
further detail).
Table 4.23 Research activity by the Irish ?nancial services education and training providers – linking
research to courses
Skills/research
provider
Linking research to course content
Universities Universities reported that research conducted is fed back to students through course content/
material and class discussions. However it was found that it is more likely for this to occur at
postgraduate level than undergraduate due to the complex nature and more speci?c focus of
the research.
Institutes of
Technology
As little to no research is being conducted within the IoTs reviewed, linking research to course
content is not relevant in this instance.
However, similar to the universities, Waterford IT reported that some research can be fed back to
students through class material; however this is dependent on the individual lecturer.
Industry
Training Bodies
In relation to the CFA Institute, research will be incorporated into course material/content if the
research conducted involves topics included in the Candidate Body of Knowledge (e.g. what a new
CFA needs to know). If the topic relates to the Global Body of Knowledge (a broader concept
which includes knowledge that an experienced CFA needs to know), it is included in continuing
education programs.
The IoB indicated that the ?ndings of research conducted within the planned GFA (‘Global Finance
Academy’) will not only be fed back into industry but also will inform future programme
development, particularly at the ‘higher-end’.
(vi) Linking Research to Industry
Finally, consultations highlighted the extent to which research undertaken by the education providers is
being fed back into industry:
In general, across the universities and IoTs consulted, there was little evidence of research undertaken
by the education providers being fed back to industry;
A limited number of examples were found in the universities interviewed – research ?ndings were fed
back to industry predominantly as a result of joint research programmes/sponsorship of research by
industry and industry attendance at ‘academic conferences’, however it was reported that industry have
a “lack of interest” in research activity in Irish universities; and
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International Financial Services International Financial Services International Financial Services 139
Some evidence of linking back research to industry was found in one of the industry training bodies, via
industry membership of programme advisory boards, etc (refer to Table 4.24 for further detail).
Table 4.24 Research activity by the Irish ?nancial services education and training providers – linking
research to industry
Skills/research
provider
Linking research to industry
Universities In general, there was little evidence of research conducted within the universities consulted being
fed back into industry.
Of those universities that indicated that they fed research ?ndings to industry, the two principle
methods of doing so were:
As an output of joint research programmes and/or where sponsorship has come from
industry; and
Through ‘Academic Conferences’ – some universities however, reported a “lack of interest”
from industry in attending such events.
UCC however hope to share their research with industry more formally going forward, through the
establishment of an ‘industry board’ for the proposed Centre for Financial Mathematics (virtual
centre jointly developed with DCU). This board will be used as a forum for discussion and sharing
of research ideas/topics.
Furthermore, UCC expect that PhD students (through the ‘Centre for Financial Mathematics’) will
join industry on an internship and integrate/share their research and/or industry may undertake
research at the Centre for a period of one/two years.
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Institutes of
Technology
It was found that research is not linked back to industry in Waterford IT at present, however they
would like to develop greater links with industry going forward.
Industry
Training Bodies
The CFA Institute did not report that research conducted is fed directly back into industry.
However, as research ideas are primarily generated by practising members advisory boards who
comprise industry professionals, research results can be fed back to industry via their involvement
with the CFA.
The IoB stated that it was important for their expected research to be fed back to industry.
Although they are not currently involved in research activities the IoB envisage that their role within
the planned GFA will be a bridge between academia and industry.
“ensuring research is brought-out of academia and is of direct use to the ?nancial services
industry in Ireland”.
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International Financial Services 140 International Financial Services International Financial Services
4.4 Industry Linkages/Collaboration
Finally, to identify the linkages Irish ?nancial services education has established with industry, the Irish
education and training providers were asked for their experience of/views on the following aspects:
industry design of course content; industry delivery of course content; internships/work placements; joint
research programme with industry; funding from industry; and other evidence of industry participation.
Details of each are provided in the following sections.
(i) Design of Course Content
Firstly, consultations with Irish education providers highlighted the level of industry input into the design of
?nancial services programmes within the Irish education providers interviewed. As a result, the following
trends were identi?ed (refer to Table 4.25 for further detail):
Industry involvement in the design of course content is primarily informal in nature – input is primarily
in the form of informal discussions and meetings between university/IoT staff and industry
representatives, however the frequency/level of interaction varies across individual staff members;
Contacts are developed through linkages with industry via joint research activity, student work
placements, alumni, personal contacts, etc, which is typically driven by the universities
approaching industry;
Some evidence of formal processes to include industry in the design of course content was noted
(through participation on course boards, industry advisory boards, etc), however this was limited to a
small number of the universities and IoTs interviewed;
It appears from consultations with IoTs that many of their ?nancial services courses are tailored towards
the skills requirements of their local ?nancial services industry; and
There was strong evidence across the industry bodies interviewed of industry representatives formally
designing course material, in particular through writing class material/textbooks.
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Table 4.25 Industry linkages for Irish ?nancial services education and training providers – design of
course content
Skills research
provider
Design of course content
Universities Industry involvement in the design of ?nancial services related course content is typically informal
in nature. This is usually conducted via informal discussions and meetings between university staff
and industry representatives, however the frequency/level of interaction varies across individual
staff members.
It was the view of one university that:
“industry collaboration in relation to course design needs to be structured in order to facilitate the
exchange of ideas – very hard to get industry signed up to this”.
Contacts are developed through linkages with industry via joint research activity, student work
placements, university alumni, personal contacts, etc, which is typically driven by the universities
approaching industry. There is also some evidence, albeit to a lesser degree, of industry
approaching universities to inform/in?uence course content.
For example, UCD increased the student internship for the ‘MSc Quantitative Finance’ from three
months to one year based on feedback from Pioneer.
In UCC, during the design of the ‘BSc Financial Mathematics and Actuarial Science’, the Institute of
Actuaries asked UCC to meet with industry to discuss potential course content (the Institute is
responsible for awarding exemptions to Actuarial exams).
Some evidence of formal processes to include industry in the design of course content was noted,
however this was limited to a small number of the universities interviewed.
For example, (as described in Section 2, Table 4.15) in the Business Information Systems
Department in UCC, an ‘Advisory Business Board’ was established to advise the Department on
industry developments and future course content.
Furthermore, coinciding with the development of the ‘Centre for Financial Mathematics’ in
UCC, is the establishment of an ‘industry board’. Although the primary focus of the board is sharing
of research issues/ideas, it is expected that industry views will indirectly feed into course content
and design.
Institutes of
Technology
Similar to the universities, it was reported that industry involvement in the design of course
content in the IoTs is primarily informal in nature. For example, through feedback on quality of
work placement students and graduates and discussions and meetings with industry to discuss
industry requirements and trends/developments.
Some evidences of formal processes to include industry in the design of course content was found.
In Waterford IT for example, an industry advisory board or the ‘Advisory Forum for Management
Education’ advises the Business School on industry developments and future course content. In
addition, when introducing a new course module a ‘Peer Review Panel’, which includes members
of industry, reviews module content.
In relation to the level of industry involvement, IoTs reported signi?cant collaboration with industry.
For example, Sligo IT noted that industry was heavily involved in the design of their ?nancial
services course content stating that “local industry is very willing to get involved”. They also believe
that it was to industries bene?t to be involved as “they see what is being produced and this helps
develop good relationships”.
It appears from consultations with IoTs that many of their ?nancial services courses are driven by
the skills requirements of the local industry.
For example, the ?nance courses in Waterford IT are geared towards the skills needs of the funds
administration industry in the South East, including companies such as State Street, PFPC and
BYSIS. It was commented that “on occasion we have made a lot of changes in our courses for the
funds industry”.
Furthermore, the H. Dip in Financial Services Technologies in Letterkenny IT was developed
speci?cally in response to a demand by Primerica and Northbrook Technologies for students with
skills in mainframe programming.
International Financial Services 142 International Financial Services International Financial Services
Skills research
provider
Design of course content
Industry
Training Bodies
There was strong evidence across the industry training bodies interviewed of industry
representatives formally designing course content, in particular through writing class
material/textbooks.
For example in the III, course material/textbooks are sent to each member of the industry
advisory panel dedicated to updating an individual modules – comments/changes/extra
materials are suggested by the industry representative and incorporated into course material by
the textbook writers.
Furthermore in the CFA Institute, practising investment professionals are engaged to write
curriculum material (e.g. speci?c book chapters), which is provided to the CFA candidates to
prepare for the CFA examinations.
In addition, the IoB offers provide a Certi?cate in Applied Financial Services to Citigroup. This
Certi?cate is open to Citigroup employees in Ireland and is accredited under the European Transfer
System (ECTS). The bene?ts to Citigroup are it:
Is a tailored programme;
Results in a formal quali?cation;
Brings participating employees to a common level of education training;
Provides upgrading of existing staff; and
Assists with staff retention and motivation levels.
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(ii) Delivery of Course Content
In relation to industry’s involvement in the delivery of ?nancial services course content the key ?ndings
are summarised below, with further detail available in Table 4.26.
Industry involvement in the delivery of course content is primarily through the use of guest lecturers/
speakers in the universities/IoTs interviewed.
Although they are considered a bene?t to some courses/modules, the involvement of guest lecturers is
typically not a formal course requirement. Instead, guest lecturers are typically brought in on an ad hoc
basis and are very often personal contacts of individual lecturers.
Some evidence was found however, of industry representatives delivering entire modules – however,
this was limited to one of the IoTs interviewed.
By contrast, two of the industry training bodies regularly use industry representatives to deliver entire
modules, with industry delivering all modules for one of the bodies interviewed.
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Table 4.26 Industry linkages for Irish ?nancial services education and training providers – delivery of
course content
Skills/esearch
provider
Delivery of course content
Universities The principle method of industry delivery of course content is through the use of guest lecturers/
speakers. Although they are considered a bene?cial addition to some courses/modules, the
involvement of guest lecturers is typically not a formal requirement of a course/university. Instead,
guest lecturers are typically brought in on an ad hoc basis and are very often personal contacts of
individual lecturers.
For example, UCD makes reference to individuals from leading ?nancial services institutions
who occasionally deliver seminars and talks as part of their ?nancial services courses. DCU also
has a number of ‘adjunct’ lecturers from industry, who have specialisms in the areas of: hedge
funds; portfolio analysis; ?nancial markets; ?nancial products; and regulation.
In UL, industry representatives cover either an industry topic or presentation – this is
predominantly at a postgraduate level rather than undergraduate. In UCC, an ‘Actuarial Teaching
Team’ was established for the BSc Financial Mathematics and Actuarial Science degree, which
comprises three people from industry (quali?ed actuaries) who regularly deliver guest lectures.
NUI Galway commented that guest lecturers are used occasionally; however they have plans
to introduce a more structured input from industry lecturers in their new MEconSc
International Finance.
All universities reviewed were of the view that industry involvement in the delivery of courses was
bene?cial in providing students with practical insights into relevant industries/sectors. However,
many universities cited time constraints as a factor limiting the development in this area.
Institutes of
Technology
As per the universities, the principle method of industry delivery of course content is through the
use of guest lecturers/speakers.
For example, in Letterkenny IT, guest lecturers from Primerica and Northbrook are regularly used as
guest lecturers on the H. Dip. Financial Services Technologies. In Waterford IT, in addition to using
guest lecturers regularly throughout the year, PFPC also deliver some modules on their ?nancial
services course – modules are related to fund administration and fund agency.
Industry
Training Bodies
The use of industry representatives varies across the industry training bodies interviewed, however
they are used more frequently than in the universities and IoTs interviewed.
For example, all modules in the III are delivered by industry practitioners, which are delivered
during the evening and at weekends. The IoB draw their lecturers from both academia and
industry. The do not offer full-time lecture posts which allows them to select the best from both
areas with the most appropriate knowledge to deliver a programme/module(s).
In the CFA Institute however, the course program itself is self study, so lectures are not delivered by
the Institute.
(iii) Internships/Work Placements
The following points provide a summary of the key ?ndings in relation to the use of work placements/
internships amongst the Irish education providers interviewed (refer to Table 4.27 for a detailed review
and examples):
A small number of ?nancial services related courses have work placements/internships across the
universities and IoTs interviewed. Speci?cally, of the 176 courses delivered by the universities and IoTs,
27 (15 percent) include a work placement option (21 by universities and six by IoTs);
The vast majority of work placements (22 out of 27 courses) are offered at undergraduate level; and
Work placements are typically offered across business and ?nance courses, rather than mathematics or
statistics programmes;
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International Financial Services 144 International Financial Services International Financial Services
Students in the universities appear to work with ?nancial services companies based in Dublin or in
other cities including Galway, Cork and Limerick. A smaller number of work placements are completed
abroad in the US or UK. In the IoTs however, students are more likely to complete internships with local
companies in the surrounding area, rather than in Dublin; and
Although work placements were noted by the education providers as being important, time and level of
industry interest/participation were cited as key barriers to the introduction of internships.
Table 4.27 Industry linkages for Irish ?nancial services education and training providers – internships
Skills/research
provider
Internships/work placements
Universities Across the universities interviewed, 21 (or 16 percent) of the 132 ?nancial services related courses
(including both existing and new courses expected in 2007/2008 or 2008/2009) formally offer
students a work placement/internship programme (optional or compulsory).
The vast majority of work placements are offered at undergraduate level (18 of 21 courses), with
only three postgraduate courses offering a work placement programme.
Placements are typically offered across the business and ?nance courses, rather than mathematics
or statistics courses.
Students primarily work with companies in Dublin, however placements are also completed in
Galway, Limerick and Cork and other regional towns.
For example, in UL, students in the undergraduate Bachelor of Business Studies course complete
work placements with a range of ?nancial services companies in Ireland, including JP Morgan; AIB
Capital Markets; Bank of Ireland; Intel Finance Department, etc. Many of the work placements are
completed in Dublin.
However, some placements are undertaken with leading ?nancial services companies abroad,
particularly in the US.
For example, as part of the BSc Business Information Systems course in UCC, students are required
to complete a six month work placement. The vast majority of students work in the US in the
leading ?nancial services companies (82 students from this course in East Coast America in 2007),
including Federal Reserve Bank, Sunlife, State Street, RBS, Chevy Chase Bank, etc. Students are
also placed in Ireland in companies such as Accenture, Deloitte and AIB.
Internships/work placements with industry are considered to be both bene?cial for the student
and for industry. In addition to providing a student with insight and practical experience of the
industry, it provides industry with “cheap resources” and can be “an excellent source of future
employees”. UCC for example, reported that almost 100 percent of Business Information Students
are offered jobs by their industry placement employers.
There were however a number of issues/constraints noted by the Universities in relation to
internships/work placements. They include:
Lack of interest from industry in providing placements to students;
The time factor in organising work placements in that it is very time-consuming; and
The dif?culty in ?nding quality work placements in their immediate region for universities
located outside of Dublin.
As an alternative to work placements, UL are in the process of constructing a ‘trading ?oor’ facility
in their Kemmy Business School, to be delivered in conjunction with two of their Masters
programmes (Financial Services and Computational Finance) due for completion in early 2008.
This will allow for simulated training and teach students how to trade while in an academic setting.
For example, of the 10 subjects delivered in the Masters in Computational Finance, eight of these
are delivered in the trading room, in a ‘learning-by-doing’ fashion.
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International Financial Services International Financial Services International Financial Services 145
Skills/research
provider
Internships/work placements
Institutes of
Technology
Across the IoTs interviewed, 6 (or 14 percent) of the 44 ?nancial services related courses
(including both existing and new courses expected in 2007/2008 or 2008/2009) include work
placements as part of their ?nancial services related courses.
Four of these are offered at undergraduate level, with the remaining two available at
postgraduate level.
Students typically work all over Ireland, however it appears that students in the IoTs are more likely
to complete internships with local companies in the surrounding area, rather than in Dublin.
For example, in Letterkenny IT, students on the H. Dip in Financial Services Technologies
complete a four week work-placement in Primerica or North Brook Technologies based near
the college. The majority of students (12 out of 15 in 2007) are offered positions as a result.
In Waterford IT, students complete a six month work placement with a ?nancial services company
as part of the BA Financial Services and the Bachelor in Business Studies (Economics and Finance
and/or Accounting Streams). The vast majority of students work for companies in the South East,
namely PFPC, BYSIS, State Street and Citigroup, however, students also complete placements in
Dublin. Students taking the Accounting stream in BBS, work with the ‘Big 4’ or some smaller
accountancy ?rms. However again these are predominantly with companies in the local area.
Students, who take the Financial Services stream in BBS in Sligo IT, undertake a ?ve month work
placement with companies such as Bank of Ireland and Morgan Stanley amongst others.
Industry
Training Bodies
None of the industry training bodies interviewed include work placements as part of
their programmes.
(iv) Joint Research Programmes
The bullet points below provide a summary of the key points identi?ed from the consultations with Irish
?nancial services education providers in relation to joint research programmes between industry and
education (refer to Table 4.28 for further detail):
There was limited evidence of joint research activity between industry and the universities/IoTs; and
The universities attributed this low level of joint research activity to a number of factors including:
differing time-scales between industry and academia; industry conducting in-house research; and
ownership issues. It was also considered that the availability of research funding from industry
is limited.
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Table 4.28 Industry linkages for Irish ?nancial services education and training providers –
joint research
Skills/research
provider
Joint research programmes/research linkages
Universities Based on the university interviews, there were limited examples of joint research activity
with industry.
For example, UCD conducts a number of joint research programmes with industry through both
the ‘Centre for Financial Markets’ and their ‘National Computing Research and Application Group’.
In addition, UL is partnering with Intuition, a provider of ?nancial services training software, in the
development of a trading simulation software library, which will be used across the ?nancial
services industry. The university will have an extensive licence for use of the software afterwards.
Some universities commented that the low level of joint industry research programmes within
their institutions was due to factors including:
Academic research requires time, whereas industry generally requires research to be conducted
at a quicker pace;
Many ?nancial services institutions are conducting their own in-house research and “have the
time, money and personnel to do so”; and
Industry very often want to own the rights to research (Non-Disclosure Agreements),
particularly product-development research. This con?icts with the academic priority of
increasing their university credibility by publishing research ?ndings.
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Institutes of
Technology
Based on consultations with IoTs, there appears to be no joint research programmes between
academia (IoTs) and industry.
Waterford IT, however, report they receive a small amount of funding from industry, and in the
future would like to develop their relations with industry further: “…believe industry is
interested in research, but we need to make that leap like we did in the sciences”
As the ?nancial services related courses in Sligo IT have recently been introduced, they have not
yet engaged in undertaking research activities. However, as these courses mature, they hope to
establish research capacity in this area. Similarly in Letterkenny IT, they hope to “venture into
?nancial services research in the future”.
Industry
Training Bodies
There was no evidence of joint research programmes found in the industry training
bodies interviewed.
It was indicated by IoB however, that this be a major focus of the planned GFA and
Doctoral programmes.
(v) Funding from Industry
Consultations with Irish universities/IoTs/industry bodies indicated the level and nature of funding
received from industry by the education providers.
Overall, it was reported that little/no funding was provided by industry for ?nancial services related
research activities – it was perceived by the universities that industry has “little interest in doing so”.
Where funding is received, this can take the form of ‘monetary’ support for research or through the
provision of researchers.
Outside of research, in some cases, industry were involved in providing student sponsorships (refer to
Table 4.29 for further detail).
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Table 4.29 Industry linkages for Irish ?nancial services education and training providers – funding
from industry
Skills/research
provider
Funding from industry
Universities Overall, it is the view of those interviewed that little/no funding was provided by industry for
?nancial services related research activities and there would appear to be little interest from
industry in doing so as re?ected in the comments below:
“Collaboration with industry on research does not happen, and although there is some interest
from industry on their research, no funding is offered or provided by industry for further research”.
“No money is being made available to allow individuals to conduct research, which would put
them at the top of their ?eld, however there is no premium or incentive from industry to move
this forward”.
Where funding is received, this can take the form of ‘monetary’ support, whereby a small number
of universities reported limited levels of research funding from the ?nancial services industry.
For example, the Business Information Systems Department in UCC received research funding
from a wide range of ?nancial services institutions including the Federal Reserve Bank, Barclays,
Bank of Ireland and State Street.
There was also some evidence of the provision of student sponsorship:
For example, UCD cited NTMA, Goodbody Stockbrokers and Bank of Ireland amongst their sources
of student sponsorship.
Finally, some universities reported that industry may also provide universities with researchers:
UCD commented that AXA and VHI provided researchers in addition to monetary support
for research.
Each of the universities consulted were hopeful of increased levels of funding from industry
in the future.
For example, UL is building up their research capacity to facilitate increased levels of research, and
as a result, are looking for further industry support for research initiatives. Whereas other
universities indicated that development of this area was constrained by lack of available funding.
Institutes of
Technology
There were no reports from the IoTs consulted of any funding being made available from industry.
Industry
Training Bodies
The CFA Institute noted that some contributions were made from industry for research. Going
forward, the IoB envisage that future joint/industry drive research initiatives will be funded in part
by industry.
Furthermore, the courses delivered by the industry training bodies interviewed are primarily
funded by member subscriptions (from industry professionals) and/or payment for courses by
those already working in industry.
International Financial Services 148 International Financial Services International Financial Services
(vi) Other Industry Linkages/Collaboration
Consultations with the Irish ?nancial services education providers identi?ed a number of further linkages
with industry, including:
industry sponsorship of speakers at conferences;
agreements with industry to use their university/college facilities (e.g. classrooms, technical
equipment, etc);
joint promotion of speci?c ?nancial services courses; and
funding from the ?nancial services sector for facilities.
Table 4.30 Industry linkages for Irish ?nancial services education and training providers – other
linkages/collaboration
Skills/research
provider
Other industry linkages/collaboration
Universities Other forms of industry linkages cited include:
Trinity College reported industry sponsorship of speakers at conferences, e.g. INFINITI;
In UL, post completion of their trading room, they have an agreement with Intuition that it can
be used as a base for providing Executive Education to Intuition’s client base in the US (four,
three-day sessions annually);
Pioneer is involved in the promotion of UCD’s MBS Quantitative Finance, e.g. joint Pioneer/
UCD advertisement in the national media; and
UCD has received funding from the ?nancial services sector for facilities.
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Institutes of
Technology
There were no additional industry linkages identi?ed, further to those listed above.
Industry
Training Bodies
No additional industry linkages were identi?ed in the industry training bodies interviewed.
4.5 Summary
The provision of Irish ?nancial services education and training is quite diverse in the Irish
universities/IoTs interviewed, ranging from “broad” business studies, accounting, economics and
mathematics/statistics courses to “dedicated” courses for the ?nancial services industry, such as those
covering ?nance, actuarial science, insurance, banking and corporate ?nance. The number of courses
however, dedicated to speci?c sectors (e.g. insurance, banking and capital markets and/or investment
management) is relatively low (less than 5 percent). It is important to note that many of the
“dedicated” ?nance courses offer modules which provide students with the skills to work across almost
all ?nance sectors at some level. Conversely, the courses delivered by the industry bodies have a high
sector focus, concentrated on one or more sectors.
There is greater ?exibility for Irish universities/IoTs to update course content/course modules rather
than introduce a new course, which is typically a complex and lengthy process taking up to three years.
Industry bodies appear to have a less onerous process around new course development and minor
changes to course content can be made as required without formal approval.
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International Financial Services International Financial Services International Financial Services 149
The universities and IoTs use a number of processes to review course content including: periodic
university-wide reviews; formal/informal annual reviews; and ongoing reviews conducted informally
throughout the year. Review mechanisms used by the industry bodies are primarily centred around
reviewing course content annually in conjunction with industry.
Mechanisms to ensure courses remain up-to-date with industry developments in the universities/
IoTs include processes such as: ongoing fostering of informal industry linkages through work
placements, individual personal networks, university alumni and industry conferences; course boards to
review and input into the design of course content typically comprising industry experts; and face-to-
face meetings with industry. While industry input is recognised as being vital to ensuring graduates are
equipped with the latest industry requirements and that courses are kept up-to-date with the latest
trends and developments, universities/IoTs cited the challenges and dif?culties associated with ensuring
industry engages effectively in this activity. Conversely, the industry training bodies appear to interact
with industry on a more formal basis more regularly than the Universities and IoTs, through, for
example industry surveys and dedicated meetings with industry to discuss course content.
There was limited evidence of inter-institutional collaboration in the universities and IoTs on
the design and delivery of course content. Industry training bodies on the other hand report
signi?cant levels of collaboration with other representative bodies and academia in the development
of their programmes.
Although each of the universities interviewed are active in ?nancial services research, only one IoT
and one industry body were active in this area. The key drivers of research activity in the universities/
IoTs were individual lecturer research interests and industry trends and developments. Speci?c research
areas were found to vary across the research active institutions. However, a number of broad research
themes emerged, covering risk management asset management and corporate ?nance. The majority of
the universities have developed dedicated ?nance research centres, with inter-institutional collaboration
evident in some of the centres. Various funding sources for research initiatives were cited including: the
Irish Government/State Bodies; the university itself; and to a much lesser extent industry. Typically,
research ?ndings are fed back to students via course content and class discussions, although this is
more likely to happen at postgraduate level due to the often complex nature of the research. Again
however, the universities/IoTs interviewed cited the challenges and dif?culties associated with
encouraging industry to take an interest in research undertaken in the universities/IoT and/or
participate in these research activities.
Industry linkages in the Irish universities/IoTs interviewed consist of: industry input into course design
and delivery; joint research programmes; internships/work placements; provision of funding; and other
linkages such as sponsorship of speakers at conferences and joint advertisement of courses. Industry
input into the design and delivery of course content is largely informal, secured through industry
contacts and guest lecturers. Some universities/IoTs formally include industry on course review boards
and/or have established industry advisory boards, however this is limited to a small number of the
education providers interviewed. In contrast, there was strong evidence of industry-designed course
content in the industry training bodies interviewed, predominantly through writing class material/
textbooks. A small number of ?nancial services courses (16 percent) in the universities/IoTs offer a
work placement option and are predominantly completed in the surrounding area or in Dublin.
Evidence of joint research activity with industry was limited as was funding of research by industry.
Again however, the universities/IoTs interviewed cited the challenges and dif?culties associated with
encouraging industry to participate in these activities.
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International Financial Services 150 International Financial Services International Financial Services
Chapter 5: Comparison of
Irish and International
Financial Services Skills and
Research Providers
5.0 Introduction
This section of the report provides an overview of a number of leading international academic institutions
in relation to their provision of education and research in the area of ?nancial services. The results from the
national and international consultations are then compared and contrasted in Section 5.6
Five education providers were consulted with as part of this phase of the study, as listed in table
5.1 below.
Table 5.1 Overview of leading international ?nancial services education and research
providers consulted
College Pro?le
New York University
(“Stern”)
Founded in 1831, it is the largest private university in the United States.
Located in ?ve major centres in Manhattan and operates branch campus and research
programs in other parts of the United States and abroad, in addition to study abroad
programs in more than 25 countries.
14 schools, colleges, and divisions – Leonard N. Stern School of Business delivers ?nance
related programmes.
Stern has more than 200 full-time faculty members – was recently (2007) rated 47th in
relation to the ‘Best National Doctoral Universities’ and 18th for ‘Best Undergraduate
Business Programmes’.
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University of
Pennsylvania
(“Wharton”)
Founded in 1740, it is America’s ?rst university and is the fourth-oldest institution of
higher education in the United States.
About 4,500 professors serve nearly 10,000 full-time undergraduate and 10,000
graduate and professional students.
Four undergraduate schools and 12 graduate and professional schools, one of which is
the Wharton School, offering ?nance related programmes.
Wharton has over 300 professors and is the world’s most published and cited business
school faculty.
Ranked the best business school in the world by Financial Times every year except for
2005, when it tied with Harvard.
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London Business
School (“LBS”)
London Business School has 92 faculty members and over 1,400 degree students.
The School’s full-time and Executive MBA programmes are counted among the world’s
best according to the Financial Times and Business Week business education surveys.
The School has also twice been awarded the highest research rating of ?ve star (5*) by
the Higher Education Funding Council for England (HEFCE).
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International Financial Services International Financial Services International Financial Services 151
College Pro?le
City University
London (“Cass”)
Over 40 Professors involved in the areas of ?nance and management, in addition to 100
active research members. Research in Cass received a 5* RAE rating in 2001.
Cass undergraduate programmes are ranked 1st in London and 3rd in the UK for
business by the Guardian University Guide 2008.
Largest provider in Europe of Specialist Masters courses geared towards the
global ?nancial services industry (over 20, 18 of which are speci?cally related to
?nancial services).
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University of
Reading, London
(“ICMA Centre”)
Established in 1892, with three campuses in Reading.
Established in 1991 as a result of collaboration between the university and the
International Capital Markets Association. Finance courses are delivered through the
ICMA centre in the Business School.
The centre has two dealing rooms using similar software to those found in leading
investment banks – extension completed in 2008 to include an additional 50 seat
dealing room.
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Source: PwC derived.
Each of the organisations consulted with, as listed above, are involved in the provision of ?nancial services
courses. The nature and extent of their provision at both undergraduate and postgraduate levels, are
described in the following table, Table 5.2
Table 5.2 Summary of ?nancial services courses and research in the international
institutes interviewed
College Number of
?nancial
services
courses
06/07
Undergrad
or postgrad
Faculty Title of ?nancial services
related courses*
New York
University*
6 2UG
4 PG
Finance Department,
Stern Business School
BSc Finance
MBS Finance
PhD Finance
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Accounting, Taxation
and Law Department,
Stern Business School
BSc Accounting, Taxation and Law
MBS Accounting, Taxation and Law
PhD Accounting, Taxation and Law
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University of
Pennsylvania*
12 4 UG
8 PG
Finance Department,
Wharton
BSc Finance
MBA Finance
PhD Finance
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Insurance and Risk
Management
Department, Wharton
BSc Insurance and Risk Management
MBA Insurance and Risk Management
PhD Insurance and Risk Management
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Accounting
Department, Wharton
BSc Accounting
MBA Accounting
PhD Accounting
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Statistics Department,
Wharton
BSc Statistics
MBA Statistics
PhD Statistics
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International Financial Services 152 International Financial Services International Financial Services
College Number of
Financial
Services
courses
06/07
Undergrad
or postgrad
Faculty Title of ?nancial services
related courses*
London
Business
School
4 4 PG Business School MSC in Finance**
MBA Business
PhD Accounting
PhD Finance
(EMBA Global)***
(Dubai – London EMBA)***
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City University
London
18 5 UG
13 PG
Faculty of Finance,
Cass Business School
BSc Banking and International Finance
BSc Investment and Financial
Risk Management
BSc Real Estate Finance and Investment
MSc in Banking and
International Finance
MSc in International Accounting
and Finance
MSc in Investment Management
MSc in Finance
MSc in Real Estate Investment
MSc in Finance, Risk and Investment
MSc in Quantitative Finance
MSc in Financial Mathematics
MSc in Mathematical Trading
and Finance
Graduate Diploma in Anti Money
Laundering
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Faculty of Actuarial
Science and Insurance,
Cass Business School
BSc in Actuarial Science
BSc Risk Analysis and Insurance
Diploma/MSc in Actuarial Management
Diploma/MSc in Actuarial Science
MSc in Insurance and Risk Management
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University of
Reading
7 1 UG
6 PG
ICMA Centre (in the
Business School)
BSc Finance and Investment Banking
MSc International Securities, Investment
and Banking
MSc Investment Management
MSc Financial Risk Management
MSc Capital Markets, Regulation and
Compliance
MSc Finance and Real Estate
PhD Programme
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* Note: courses offered in ?nance related areas are specialisms of an overall Business Quali?cation.
**The MSc in Finance is a recognised CFA programme partner.
*** These courses have been left out of the course count as they are not offered in the local jurisdiction.
Source: PwC derived.
International Financial Services International Financial Services International Financial Services 153
In order to review the provision of ?nancial services education by these leading international institutions
the same analysis framework developed to pro?le the Irish education and training provision has been
used. The information gathered during this programme of consultations is presented under the
headings of:
5.1 Course provision;
5.2 Course development and update;
5.3 Research activity; and
5.4 Industry linkages/collaboration.
Each of these four framework areas comprise several sub-criteria under which the information gathered
is presented.
5.1 Course Provision
The course provision section includes details of: the number of courses provided; the extent to which
these courses are accredited or certi?ed; the level of ?nancial services sectoral focus contained within the
course content; the nature of the core focus of the courses; and the level of national and international
recognition attained by the courses. Details of each of the above are presented in aggregate for the
international academic institutions consulted.
(i) Number of Financial Services Related Courses
The following points summarise the key ?ndings from the consultations with the international
academic institutions, relating to the number of ?nancial services related courses. (Refer to Table 5.3 for
further detail).
A total of 47 courses, either speci?c to, or relevant for, ?nancial services, are delivered by the leading
international academic institutions consulted. Each university/college typically provides anything
between one and ?ve undergraduate programmes and three and 13 postgraduate courses that are
dedicated or related to ?nancial services. The majority of the courses are geared towards postgraduate
education, with only 12 of the 47 courses aimed at the undergraduate level.
The vast majority of courses (36 programmes) are dedicated ?nancial services programmes, covering
areas such as ?nance, insurance, risk management, banking, quantitative ?nance, capital markets,
actuary and investment management.
The remaining 11 courses, although not direct ?nance courses, provide skills which are central to
working in the ?nancial services industry and cover areas such as accounting, taxation, law, economics
and statistics.
In the universities/colleges consulted, ?nancial services related courses are typically delivered by the
Business Faculty/School. Although within the individual schools, one to four Departments are
responsible for providing ?nance related courses.
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International Financial Services 154 International Financial Services International Financial Services
Table 5.3 Course provision by international ?nancial services education providers –
?nancial services courses
Skills/
research
provider
Number of ?nancial services related courses
International
Education
Providers
Across the international universities/colleges consulted there was a total of 47 ?nancial services
related courses delivered. Each university/college typically provides anything between one and ?ve
undergraduate programmes and three and 13 postgraduate courses that are dedicated, or related,
to ?nancial services.
The majority of these courses (36 programmes) are dedicated ?nancial services programmes,
covering areas such as ?nance, insurance, risk management, banking, quantitative ?nance, capital
markets, actuary and investment management.
Examples include:
BSc Finance (NYU/Penn State); BSc Insurance and Risk Management (Penn);
BSc Banking and International Finance (Cass); BSc Investment and Financial Risk
Management (Cass);
BSc Real Estate Finance and Investment (Cass); MSc Quantitative Finance (Cass);
MSc Actuarial Science (Cass); BSc Finance and Investment Banking (Reading);
MSc Financial Risk Management (Reading); MSc International Securities, Investment and
Banking (Reading); and
MSc Finance (LBS); and PHD Finance (LBS).
The remaining 11 courses, although not direct ?nance courses, provide skills which are central to
working in the ?nancial services sector. Such courses cover areas including accounting, taxation, law
economics and statistics.
These courses are as follows:
BSc Accounting, Taxation and Law (NYU); MBS Accounting, Taxation and Law (NYU);
PhD Accounting, Taxation and Law (NYU); BSc Accounting (Penn State);
BSc Statistics (Penn State); MBA Accounting (Penn State);
PhD Accounting (Penn State); MBA Statistics (Penn State);
PhD Statistics (Penn State); MBA Business (LBS); and
PHD Accounting (LBS).
At present, none of the international institutions consulted are planning to introduce any additional
?nancial services related courses in the near future.
In the universities/colleges consulted, ?nancial services related courses are typically delivered by the
Business Faculty/School. Although within the individual schools, one to four Departments are
responsible for providing ?nance related courses.
For example, in Penn State, the Finance Department, Insurance and Risk Management
Department, Accounting Department and the Statistics Department within the Wharton School
of Business, are all responsible for delivering ?nancial services related courses.
In Cass Business School, two Faculties are responsible for delivering ?nance related courses, namely
the Faculty of Finance and the Faculty of Actuarial Science and Insurance. In NYU Stern, the Finance
Department and the Accounting, Taxation and Law Department deliver ?nancial services related
courses within the Stern Business School.
While in Reading, one Centre within the Business School, the International Capital Markets
Association, is responsible for the delivery of ?nance courses.
In LBS ?nance related courses/modules are drawn from the School’s Finance, Accounting and
Economics faculty together with a small number of staff from other departments around the school.
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International Financial Services International Financial Services International Financial Services 155
(ii) Accreditation/Certi?cation
The key ?ndings in relation to the level to which ?nancial services related education and training is
certi?ed in the international universities/colleges consulted are summarised in the points below (Refer to
Table 5.4 for further detail):
Of the ?nancial services related courses reviewed the majority (35 of 47 courses) are accredited as
postgraduate programmes, with the remaining 12 courses being undergraduate programmes; and
Of the 36 dedicated ?nancial services courses delivered by the universities in 2006/2007 (as described
in the previous section (Section (i), number of ?nancial services related courses)), the vast majority (25
courses) are undergraduate, with the remaining 11 courses accredited to postgraduate level.
Table 5.4 Course provision by international ?nancial services education providers –
accreditation/certi?cation
Skills/research provider Accreditation/certi?cation
International Education
Providers
Across the international universities/colleges interviewed, the ?nancial services related
courses consist of undergraduate honours bachelor degree courses and postgraduate
programmes including a small number of PhD programmes. Speci?cally:
35 of the 47 ?nancial services related programmes are postgraduate and
PhD programmes; and
The remaining 12 courses are accredited as undergraduate bachelor degrees.
Undergraduate programmes are typically three to four years in length, with
postgraduate programmes ranging from one to two years and PhDs from three
to ?ve years.
Of the 36 dedicated ?nancial services courses delivered by the universities in
2006/2007 (as described in the previous section [Section (i), number of ?nancial
services related courses]), the vast majority (25 courses) are undergraduate, with the
remaining 11 courses accredited to postgraduate level.
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(iii) Sector Focused Courses
The following bullet points highlight the key ?ndings in relation to the sector focus (i.e. investment
management, banking and capital markets and/or insurance) of the dedicated ?nancial services courses
reviewed in section (i). Further analysis is provided in table 5.5 below.
Of the 47 courses delivered by the international universities/colleges, 36 of these are dedicated
?nancial services courses (as discussed in Section (i). Over half of these courses (19 out of 36) are
dedicated to one or more speci?c ?nancial services sectors.
Two programmes cover the investment management sector, three cover all three sectors (e.g. risk
management courses), six are solely focused on the banking and capital markets sector; and eight are
dedicated to the insurance sector.
The remaining 17 broad ?nance courses (covering areas such as ?nance, quantitative ?nance, etc)
provide students with the skills to work across almost all ?nancial services courses at some level.
Importantly, there is substantial potential for sector specialisation within many of these broader ?nance
courses. For example, the BSc Finance in NYU Stern offer inter-related modules and projects that enable
students to specialise in two to three core ?nance areas including banking, corporate ?nance and
quantitative ?nance.
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International Financial Services 156 International Financial Services International Financial Services
Table 5.5 Course provision by international ?nancial services education providers –
sector focused courses
Skills/research
provider
Sector focused courses
International
Education
Providers
Of the 47 courses delivered by the international universities/colleges, 36 of these are dedicated
?nancial services courses (as discussed in Section (i). The following table highlights the sector
focus of each of these courses (i.e. focus on investment management, banking and capital markets
and/or insurance)
The majority of courses (17 out of 36) are broad ?nance courses (covering areas such as ?nance,
quantitative ?nance, etc) and provide students with the skills to work across almost all ?nancial
services sectors at some level. Importantly, there is substantial potential for sector specialisation
within many of these broader ?nance courses.
For example, in NYU Stern, students undertaking the BSC Finance and MBA Finance typically
choose to specialise in two/three of the following areas:
Banking;
Corporate Finance;
Finance;
Financial Instruments and Markets;
International Finance; and
Quantitative Finance.
Both Wharton and NYU Stern considered that through their combination of compulsory and
elective modules students can tailor their quali?cation in line with sector speci?c requirements.
London Business School’s (LBS) Masters in Finance provides students with a foundation in the
principles and practices of ?nance as well as providing them with the analytical tools to assist with
?nancial decision-making.
The remaining 19 courses are dedicated to one or more speci?c ?nancial services sector (i.e.
banking and capital markets, investment management and/or insurance).
For example:
Banking and Capital Markets – MSc International Securities, Investment and Banking [Reading],
BSc Finance and Investment Banking [Reading], BSc Banking and International Finance [Cass];
Investment Management – MSc Investment Management [Reading], MSc in Investment
Management [Cass]; and
Insurance – MBA Insurance and Risk Management [Penn], BSc in Actuarial Science [Cass], MSc
in Insurance and Risk Management [Cass].
Across all of the sector focused courses, the following was observed:
Two programmes cover the investment management sector;
Three cover all three sectors (e.g. risk management courses);
Six are solely focused on the banking and capital markets sector; and
Eight are dedicated to the insurance sector.
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International Financial Services International Financial Services International Financial Services 157
Skills/research
provider
Sector focused courses
International
Education
Providers
cont../
Dedicated Financial Services Courses IM BCM INS
Finance Courses:
1. BSc Finance (Penn)
2. BSc Finance (NYU)
3. BSc Real Estate Finance and Investment (Cass)
4. MBA Finance (Penn)
5. PhD Finance (Penn)
6. MSc in International Accounting and Finance (Cass)
7. MSc in Finance (Cass)
8. MSc in Real Estate Investment (Cass)
9. MSc in Quantitative Finance (Cass)
10. MSc in Financial Mathematics (Cass)
11. Graduate Diploma in Anti Money Laundering (Cass)
12. Masters in Finance (LBS)
13. PhD in Finance (LBS)
14. MBS Finance (NYU)
15. PhD Finance (NYU)
16. MSc Finance and Real Estate (Reading)
17. PhD Finance Programme (Reading)
Sector Focused Courses:
1. BSc in Actuarial Science (Cass)
2. BSc Risk Analysis and Insurance (Cass)
3. BSc Finance and Investment Banking (Reading)
4. BSc Insurance and Risk Management (Penn)
5. BSc Banking and International Finance (Cass)
6. BSc Investment and Financial Risk Management (Cass)
7. MSc in Finance, Risk and Investment (Cass)
8. MSc Financial Risk Management (Reading)
9. Diploma/MSc in Actuarial Management (Cass)
10. Diploma/MSc in Actuarial Science (Cass)
11. MSc in Insurance and Risk Management (Cass)
12. MSc International Securities, Investment and Banking (Reading)
13. MSc Investment Management (Reading)
14. MSc Capital Markets, Regulation and Compliance (Reading)
15. MBA Insurance and Risk Management (Penn)
16. PhD Insurance and Risk Management (Penn)
17. MSc in Banking and International Finance (Cass)
18. MSc in Mathematical Trading and Finance (Cass)
19. MSc in Investment Management (Cass)
International Financial Services 158 International Financial Services International Financial Services
(iv) Core Course Focus
Feedback was also gathered from the leading international academic institutions on the focus of their
?nancial services related courses. This was assessed against the skills areas of: general management;
business; back-of?ce/administration; customer facing/operations; product development; and ?nancial
processes. A summary of the key ?ndings are provided below, with detailed ?ndings presented in
Table 5.6.
The leading international academic institutions consulted were of the opinion that their core course
provision offered a generic grounding across each of the ‘core focus’ areas. Their provision of a number
of elective modules then allows students to specialise in their ‘core area’ of choice.
For example, Cass Business School reported that they listen to feedback from their students in relation
to the introduction of new specialist elective modules – hence allowing students more ?exibility to
tailor their course to their particular area(s) of interest.
Table 5.6 Course provision by international ?nancial services education providers – core course focus
Skills/research
provider
Core course focus*
International
Education
Providers
Each of the international universities/colleges consulted considered their core course provision
to offer a generic grounding across each of the ‘core focus’* areas.
Typically, students have the option to select from a number of elective modules, which the
universities consider provide the students with the required skills in one or more of the ‘core
areas’ listed.
For example, in Cass Business School students can choose from a number of electives in
addition to conducting a number of core course modules. There is a high level of ?exibility in
terms of the introduction of specialist elective modules. If students feel an area is of particular
importance and needs to be covered it can be added to the course with relatively little effort.
Cass also allows students to take additional elective modules in lieu of preparing a dissertation
project hence allowing them to tailor the courses to their speci?c areas of interest.
In both Wharton and Stern, in the broad ?nance undergraduate and postgraduate courses,
students can choose from a range of elective modules, which can provide them with the skills
in one or more of the ‘core areas’. `For example, in the undergraduate ?nance programme in
Stern students can choose the modules ‘Money, Banking, and Financial Markets’ and ‘Real
Estate Capital Markets’, both banking and capital markets related modules.
In LBS, the Masters in Finance has a core course programme covering the areas of: ?nancial
accounting and analysis; corporate ?nance and valuation; capital markets ?nancing; and
foundations in ?nance. In addition to this core course provision students choose an additional
?ve to seven electives from a list of 25 ?nancial services related electives. These electives cover
a wide variety of ?nance areas with the most popular areas of specialism chosen by students
typically including: corporate ?nance; ?nancial engineering/capital markets; asset
management; private equity/venture capital; and ?nancial and strategic analysis.
* ‘Core course focus’ is a focus on one or more of the following areas: General Management/Business; Product
Development; Financial Processes; Back-of?ce/Administration; and Customer Facing Role/Operations.
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International Financial Services International Financial Services International Financial Services 159
(v) National and International Recognition
In terms of the national and international recognition of ?nancial services courses provided by the
leading international academic institutions consulted the following key trends were highlighted (refer to
Table 5.7 for detailed review):
The leading international academic institutions consulted are revered as leading academic institutions
in relation to their course provision and level of research activity. For example the NYU Stern Doctoral
programme is rated ?rst in the US and Cass Business School’s undergraduate programmes are ranked
1st in London and 3rd in the UK for business by the Guardian University Guide 2008;
LBS has twice been awarded the highest research rating of 5* by HEFCE and their MBA programmes
are rated amongst the world’s best;
From a non-academic perspective, LBS are also considered to be key providers of talent to the ?nancial
services sector of graduates and postgraduates; and
In addition to the above trends, it was noted, by a number of the universities, that academic rankings
are very often based on the number of MBA/management related courses and research activity and not
on the level/standard of ?nancial services course provision. However, one participant indicated that
they believed a ?nancial services academic ranking was being developed.
Table 5.7 Course provision by international ?nancial services education providers – national/
international recognition
Skills/research
provider
National and international recognition
International
Education
Providers
The international institutions consulted were selected on the basis of being renowned
providers of ?nancial services education, training and research.
For example, data compiled by ‘Academic Analytics LLC’ rate the Doctoral Program in Finance
at NYU Stern as the number 1 programme in the US. The rankings are based on the number of
book and journal articles published by each program’s faculty, as well as journal citations,
awards, honours, and grants received.
LBS‘s full-time and Executive MBA programmes are counted among the world’s best according
to the Financial Times and Business Week business education surveys. Furthermore the School
has twice been awarded the highest research rating of ?ve star (5*) by the HEFCE.
Cass Business School has also been voted 1st in London and 3rd in the UK for its
undergraduate course provision (Guardian University Guide 2008).
Furthermore, Wharton is ranked the best business school in the world by Financial Times in
every year in which the magazine has ranked business schools, except for 2005, when it tied
with Harvard.
However, it was noted that rankings are very often compiled based on the number of MBA/
Management courses and the amount of research conducted within an institution and not
speci?cally relating to the area of ?nance.
Cass Business School noted that current rankings and league tables are calculated by provision
of MBA programmes, management related courses and research activity, and not on level/
standard of ?nancial services course provision. However they believed a ranking/league table
was being developed related to ?nancial services education provision.
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International Financial Services 160 International Financial Services International Financial Services
5.2 International Course Development and Update
The second aspect of the international education provider pro?le relates to the development and update
of courses and incorporates details of: the mechanisms used to update course materials; the level of
industry involvement in determining course content; the extent of collaboration both within and across
institutions; and the ability of the courses to re?ect content changes on a timely basis.
Each of these elements is reviewed in the following section.
(i) Flexibility of Course/Modules
The consultations presented a number of key trends in relation to the international education provider’s
?exibility to change courses and/or modules, or introduce new courses. A summary of these key
?ndings are presented in the bullet points below (refer to Table 5.8 for further detail and examples):
The institutions indicated that the development and introduction of a new course typically takes 12
months. Whereas, the introduction of a new ‘core module’ could be introduced within four to six
months with ‘elective modules’ generally requiring even less time;
The US universities consulted with, cited offering a combination of compulsory/elective core modules
providing students with a generic grounding in ?nancial services. In addition, a number of specialist
modules are offered allowing students to specialise in a particular area or sector;
US universities reported keeping their courses relevant/up-to-date with the introduction of additional
modules on an annual basis; and
In terms of modifying existing courses/modules it was cited that minor and/or major changes to course
content did not require formal approval from the university/Department.
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International Financial Services International Financial Services International Financial Services 161
Table 5.8 Course update by international ?nancial services education providers –
?exibility of course/modules
Skills/research
provider
Flexibility of course/modules
International
Education
Providers
Introduction of a New Course/Module
The international institutions consulted indicated that the introduction of a new course typically
takes 12 months to develop and introduce.
For example, Cass Business School commented that the introduction of a new course can take up
to 12 months and requires the undertaking of a formal process, involving consideration of:
i. The requirement for/interest in the course;
ii. The aims and objectives of the course;
iii. Availability of an appropriate lecturer; and
iv. Identi?cation of target students.
LBS also referred to new course/module introduction involving a formal process.
However, the introduction of an individual module to an existing course was reported as only
requiring four to six months to develop and introduce. Furthermore, the introduction of an elective
module is reportedly easier to introduce than core modules.
The US universities consulted with, commented that they offer a number of generic ?nance
undergraduate, MBA and PhD courses. This allows students to gain a generic grounding in the area
of ?nancial services through a combination of compulsory and/or elective modules. In addition,
students can specialise in a particular area/sector by selecting specialist modules. The ?nance
course is kept relevant/up-to-date through the development and introduction of additional
modules on an annual basis.
For example, the Finance Department in NYU Stern introduces two to three new modules
annually. A number of modules in the MBA and Undergraduate Finance courses in Stern have
generic titles, e.g. ‘Topics in Corporate Finance’, ‘Topics in Investments’ and ‘Topics in International
Finance’. This allows the ‘topic’ to be changed from year-to-year depending on emerging issues/
developments in ?nancial services and new ideas for courses generated as a result.
For example, under ‘Topics in Investments’ in the MBA Finance, seven different modules are
offered, each covering a different area in Investments, including:
Advanced Fixed Income Analytics for Practitioners;
Policy Choices for Financing Retirement;
Derivatives Markets: Analyses and Applications; and
Investing in Distressed Securities.
These ‘Topics’ are predominantly delivered by Adjunct Professors, comprising part-time lecturers
who work full-time in industry.
Whereas a new topic can typically take six to nine months to develop and introduce (obviously
depending on the timing of the academic year), a new topic can be introduced within a matter of
days, as it doesn’t require formal approval from the department/university. However if a new
module is introduced (e.g. course which requires a new name and a new course code), the course
has to go through an administrative approval process which takes approximately one/two months.
Most recently, NYU Stern introduced two hedge fund modules (quantitative methods of operating
hedge funds and hedge fund management) and going forward, the Finance Department foresees
a strong demand for modules in Credit Derivatives and Project Finance.
Modi?cation of Existing Courses/Modules
It was noted by the international institutions, that minor and/or major changes to course content
can be made without seeking formal approval from the university/department.
For example, Cass Business School reported that modules can be ‘tweaked’ as necessary without
formal committee approval. As explained above, NYU Stern can modify their ‘Topics’ modules
annually to introduce an additional two to three new topics. This in a relatively quick process, with
no formal approval required from the department.
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International Financial Services 162 International Financial Services International Financial Services
(ii) Frequency of Course/Module Update
Key ?ndings in terms of the frequency of course and/or module update, as cited by the leading
international academic institutions consulted with, are summarised in the points below. Detailed ?ndings
can be viewed in Table 5.9.
The leading international academic institutions consulted referred to a number of mechanisms that are
adopted to ensure courses are relevant and up-to-date, namely: periodic university/department review;
formal annual review; informal annual review; and continuous/on-going feedback on course content.
Periodic university/department reviews were cited as being conducted anywhere between every four
and ten years and comprise a full review of all courses and modules offered by the institution. This
process provides the opportunity to appraise course content and make modi?cations as required. Cass
Business School for example stated conducting a periodic review typically every four years which
included a review of course content and performance, industry and student feedback, assessment of
quality of the graduates and ful?lment of course aims and objectives.
Formal reviews of course content were reported as occurring on an annual basis involving review of
course content by a Course Board or Course Coordinator. Whereas the occurrence of informal annual
reviews were found to be wholly dependent on the individual lecturer and may not be conducted on all
course modules.
Further to the structured processes referred to above, continuous feedback from students and industry
on course content is also used to review modules.
Feedback from industry and students, market trends and market developments were cited as being the
key drivers of module/course change.
Table 5.9 Course update by international ?nancial services education providers – frequency of
course/module update
Skills/research
provider
Frequency of course/module update
International
Education
Providers
Review Processes
Across the international institutions consulted, a number of mechanisms are adopted to ensure
course materials remain relevant and up-to-date. These mechanisms include:
periodic university/department review;
formal annual review;
informal annual review; and/or
continuous/on-going feedback on course content.
The periodic university/department review can be conducted anywhere between every four
and ten years and consists of a review of all courses/modules offered by a university. This
review presents an opportunity to overhaul/re-appraise programme content and make major
modi?cations as necessary.
For example, Cass reported that they undertake a periodic programme review typically every
four years. This review involves input from both academics and practitioners and includes a
review of the following areas:
Course content;
Course performance;
Industry/student feedback;
Quality of graduates; and
Ful?lment of course aims and objectives.
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International Financial Services International Financial Services International Financial Services 163
Skills/research
provider
Frequency of course/module update
International
Education
Providers
cont../
In NYU Stern, a formal curriculum review of the Business School is undertaken approximately
every eight to ten years. The aims of this review are to check for overlap/duplication between
modules and to ensure relevance of course content.
Another process referred to was the review of course content formally (typically on an annual
basis), which can include a review of course content by a board or a course-coordinator.
For example, in NYU Stern a course co-ordinator oversees and reviews the ?nance modules
with multiple sections (e.g. one module with 12 classes or more). Such modules are checked
for duplication in content against other ?nance modules. Typically, changes in course content
do not happen regularly as the modules with multiple sections are ‘core’ ?nance modules,
providing students with the general/basic ?nance skills.
Furthermore, in the ICMA Centre in Reading Business School, course material is reviewed
annually through a course board.
Some of the international institutions consulted with also stated they also reviewed course
content informally.
For example, Cass undertakes an informal annual review of course content. This involves
providing substantial summaries of programmes informed by consultations/meetings with
staff, students and alumni. All feedback received is reviewed and used to further develop
the course.
However, it was commented upon that very often the occurrence of an informal annual review
was dependent upon the individual lecturers and may not be conducted across all modules in
a particular course.
In NYU Stern and Wharton, course content may be reviewed annually by the lecturer and
changes made if necessary. This however, is largely dependent on the individual lecturer
and may not happen across all modules. The universities do not tend to oversee the review
of individual modules too closely and trust the lecturers will deliver a course that’s of a
high standard.
Wharton noted that they rely on the individual lecturer to ensure courses are kept relevant and
up-to-date: “If you hire the right people they will amend course content when appropriate”.
Continuous feedback on course content was reported as also being used as a form of
reviewing modules:
For example, in Cass, ongoing feedback is received from students throughout the academic
year. If both students and lecturers agree that an additional topic should be covered in the
course, this can be incorporated without committee approval.
Drivers of Module/Course Change
All the international institutions consulted with were in agreement that the key drivers of
module/course change are:
Feedback from industry;
Feedback from students; and
Market trends and developments.
For example, Cass is introducing a module in Islamic banking which is considered to be a
growing area and a module which the ‘City’ is “very excited about”. Cass also states that it is
very Important to listen to industry and react by providing the required education, training and
research to meet their speci?c needs.
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International Financial Services 164 International Financial Services International Financial Services
(iii) Mechanisms in Place to Ensure Industry Relevance
During consultations with the leading international academic institutions a number of key processes used
for updating courses in line with industry trends and development were identi?ed. A summary of these
are provided in the points below with further detail presented in Table 5.10.
The level of contact with industry in order to inform course content was found to vary across the
international institutions consulted. Some of the universities interviewed were found to have
signi?cant levels of structured industry input into course design, whereas other institutions reported
much lower levels.
Contact is typically categorised as informal, through discussions and meetings with industry, and formal
contact via industry involvement in the design of course content.
One education provider indicated that keeping up with the latest trends was less important than
providing students with the basic skills required to work in the industry.
Table 5.10 Course update by international ?nancial services education providers – mechanisms for
industry relevance
Skills/research
provider
Mechanisms in place to ensure industry relevance
International
Education
Providers
International universities/colleges reported varying degrees of contact with industry in relation
to informing ?nance course content. This contact can be categorised into:
Informal contact through discussions and meetings with industry; and
Formal contact through industry involvement in the design of course content.
For example, Cass indicated that they have some informal industry involvement in the
programme review process. This is typically in the form of face-to-face meetings to discuss
course content and the quality of graduates produced. In addition, they reported other
informal linkages with industry, for example personal contacts with industry and contacts
established via consultancy work. Both of these forums help keep the Business School well
informed on any market developments and emerging skills requirements.
In NYU Stern, industry is formally involved in the design of course content. A number of diverse
modules are delivered by the Finance Department on specialist ?nance topics, of which two to
three are changed annually to re?ect industry trends/developments. These modules are
designed and delivered by Adjunct Professors (who work full-time/part-time in industry). This
process is viewed as “a great way of getting industry ideas into the classroom” and provides
students with “up-to-date ideas and insights into the ?nancial services industry”.
In Reading University, the ICMA Centre sends course material to the ICMA Board annually
(comprising industry representatives from the International Capital Markets Association)
requesting their feedback on the relevance of course material/content.
Wharton however, noted that they are not overly concerned with ensuring that course content
re?ects the latest industry trends/issues. Rather, they aim to teach students the basic skills
required to work in ?nancial services. They stated that the course curriculum had not
“signi?cantly changed over the past 20 years” with little change to the tools used and skills
taught over this period.
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International Financial Services International Financial Services International Financial Services 165
(iv) Cross Faculty Coordination
In general, little evidence of cross faculty coordination was reported in course design and delivery during
the consultations with the international education providers interviewed. Further detail and examples are
provided in Table 5.111.
Table 5.11 Course update by international ?nancial services education providers –
cross faculty coordination
Skills/research
provider
Cross faculty coordination
International
Education
Providers
In general, little evidence of cross faculty coordination was reported in course design and
delivery. However some cross-faculty coordination was found to take place in Cass and LBS:
Cass Business School comprises faculty members from the areas of Finance, Actuarial Science
and Insurance and Management. The Finance Faculty reports higher levels of collaboration with
the Actuarial staff than Management. However, they did report that lecturers are selected
based on their appropriateness to deliver a module rather than the School or Faculty they
belong to.
LBS’s faculty delivering their Masters in Finance, are drawn from the School’s Finance,
Accounting and Economics groups with a small number of Faculty from other departments
around the school. Furthermore, ?nance faculty are also involved in the delivery of ?nancial
services related modules on the MBA programme.
There was little evidence of cross-faculty collaboration found in the other international
institutions interviewed. This is predominantly due to the fact that the business/?nance
departments had key responsibility for delivering ?nance related courses.
International Financial Services 166 International Financial Services International Financial Services
(v) Inter-institutional Collaboration
The key ?ndings in terms of the level of inter-institutional collaboration in the design and delivery of
courses are summarised in the points below (refer to Table 5.12 for a detailed analysis).
Signi?cant levels of global inter-institutional collaboration were reported across the leading
international academic institutions consulted.
Inter-institutional collaboration was reported as taking the form of student exchange programmes and
provision of modules.
A number of courses were reported as being jointly delivered by universities/colleges.
Table 5.12 Course update by international ?nancial services education providers –
inter-institutional collaboration
Skills/research
provider
Inter-institutional collaboration
International
Education
Providers
Of the universities/colleges interviewed, a number of courses are jointly delivered with other
international universities, a selection of which include:
Collaboration between Cass Business School and Olin Business School;
MSc in Global Finance jointly delivered between HKUST Business School in Hong Kong and
Stern Business School;
TRIUM MBA Degree jointly delivered between London School of Economics, Stern Business
School and HEC School of Management, Paris; and
Joint EMBA Global programme between LBS and Columbia Business School.
Further detail on these courses are as follows:
Cass Business School has an inter-institutional relationship with Olin Business School, St. Louis.
This collaboration involves undergraduate students from Olin completing an internship with a
London based ?nancial services company. During this time they also complete a number of
academic modules which are delivered by Cass. Although not happening at present, the
opportunity exists for students in Cass to do the same in St. Louis.
The MSC in Global Finance is a joint alliance between the Hong Kong University of Science
and Technology’s Business School (HKUST) and NYU Stern. During this 1 year, part-time
program, classes are primarily held in Hong Kong with a two-week intensive learning module
in New York.
The TRIUM MBA Degree is an alliance of three universities – NYU Stern, London School of
Economics and Political Science, and HEC School of Management, Paris. Six intensive
educational modules are delivered in ?ve international locations which require 10 weeks of
out-of-of?ce time over a 16-month period. Two modules each are held in NYU, LSE and HEC
Paris, as well as two other international locations which are chosen annually for their relevance
to current global business issues.
LBS has developed strong partnerships with Columbia Business School (joint MBA
programme), the Indian School of Business Hyderabad and the China Europe International
Business School (CEIBS). They also have over 30 top business schools in their international
exchange programme.
LBS also have a sister research centre based in Singapore Management University which is
aligned to the BNP Paribas Hedge Fund Centre in the UK.
The ICMA Centre in the University of Reading does not deliver any courses jointly with another
universities at present.
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International Financial Services International Financial Services International Financial Services 167
5.3 Research Activity
Table 5.13 provides an overview of: the number of faculty members involved in ?nance research; the
number of ?nancial services research centres; and the nature/focus of the research undertaken in each of
the leading international academic institutions consulted with.
Following on from Table 5.13, a detailed description of the ?nancial services research activity is presented
under the following six headings:
(i) Drivers of research activity;
(ii) R&D funding;
(iii) Level and nature of research activity;
(iv) Financial services research centres;
(v) Linking research to course content; and
(vi) Linking research to industry.
Table 5.13 Summary of research activity in the international institutions interviewed

College
Number of full-time
academics involved

Research

centres
in ?nance research Centre Research focus/Research themes
New York
University
[Stern]
45 Salomon Centre The Centre is involved in seven research initiatives,
each directed by a Stern School of Business
professor:
Asset Management;
Corporate Governance;
Credit and Debt Markets;
NASDAQ DRP;
Financial Econometrics;
Financial Institutions; and
Macro Finance.
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University of
Pennsylvania*
[Wharton]
40 Financial Institutions
Centre
Focus on technology, regulatory changes
and globalisation.
Weiss Centre for
International Financial
Services Research
World’s ?rst research centre devoted exclusively to
an understanding of international ?nance. It
sponsors research on markets, ?nancial instruments
and global economies.
Rodney L. White
Centre for Financial
Research
The White Centre has established itself as a source of
information on the ?nancial community.
London
Business
School
23 Private Equity Institute The Institute’s research activity focuses on the areas
of economic history, econometrics, accounting,
?nance, evolutionary economics, organisational
behaviour, sociology and psychology.
BNP Paribas Hedge
Fund Centre
Quantitative modelling of Hedge Fund Strategies.
Centre for Corporate
Governance
Focuses on the emerging issues surrounding the rise
of alternative investors in the ?elds of Private Equity
and Hedge Funds and their value creation strategies.
International Financial Services 168 International Financial Services International Financial Services
City University
London [Cass]
53 Alternative
Investments Research
Centre (AIRC)
AIRC aims to generate practical answers to practical
questions concerning alternative investments and
their role in investment portfolios. It acts as a
clearing house for data and research ideas between
academia and industry. The AIRC builds and
maintains databases for the various types of
alternative investments and allows its associate
researchers to access this data for qualifying
research projects.
Centre of
Econometric Analysis
The centre promotes and supports research activities
in the ?eld of:
Econometrics (methodological and applied,
macro and micro);
Financial econometrics and other quantitative
methods used in ?nance; and
Theoretical and empirical research in ?nancial
markets and corporate ?nance.
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Centre for Research
on European Financial
Markets and
Institutions
The objectives of the centre are to:
Analyse the ef?ciency, safety and global
competitiveness of Europe’s ?nancial services
industry and the sustainability of the UK’s leading
position in many aspects of ?nancial services;
and
Provide a platform for discussion for the strategic
and public policy issues affecting the European
?nancial sector.
Research conducted is organised under the three
themes of:
Technology, innovation and competition;
Law and regulation; and
European and global ?nancial integration.
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Emerging Markets
Group
The objectives of this group are to:
Establish a forum for academic research on
foreign exchange and ?nancial markets with
particular reference to emerging economies;
Serve as a centre for exchanging information;
Provide a home for research students interested
in international capital markets; and
Organise and contribute to seminars, conferences
and symposia nationally and internationally.
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Pensions Institute Research is undertaken in the ?elds of:
Pension micro-economics;
Pension fund management and performance;
Pension funding and valuation;
Pension law and regulation;
Pension accounting, taxation and administration;
Marketing of private sector pension schemes;
Macro-economics or pensions; and
Public policy.
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International Financial Services International Financial Services International Financial Services 169
Private Equity and
Venture Capital
Research Centre
The centre conducts research to investigate the
structure, functioning and performance of private
equity ?rms and their investee companies, especially
(but not exclusively) within the European
community. All aspects of private equity investment
are studied from business angles and seed capital to
buyouts and restructuring investments.
Research Centre for
Real Estate Finance
Recent research of the centre has examined issues
ranging across:
Housing economics and policy;
Real estate investment and portfolio
management; and
Real estate securities and econometric modelling
and forecasting.
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Actuarial Research
Centre
Research areas of the centre include:
Health and care;
Life insurance;
Mortality;
Non-life insurance; and
Pensions.
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Centre for Financial
Regulation and
Crime (CFRC)
The CFRC aims to develop and deliver a gold
standard for teaching and research in all aspects of
the ?ght against ?nancial crime, including prevention,
detection, investigation and management.
The centre will covers the following areas:
A forum where law enforcers, regulators and city
professionals can come together to combine
their shared expertise;
Executive MBA or Diploma in ?nancial regulation
and crime; and
Independent research.
It also offers a Diploma in anti-money laundering
and MSc in Financial Crime and Compliance to
professionals within ?nancial services.
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Risk Institute The centres main areas of expertise are:
Operational and system risk;
Risks faced by ?nancial institutions e.g. market
exposure, corporate restructuring, investment
portfolio management, capital/bond and
currency markets; and
Risks faced by populations and individuals
e.g. ?uctuating ?nancial markets, pensions,
life insurance and related ?nancial and
insurance products.
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University of
Reading [ICMA
Centre]
12-15 International Capital
Markets Association
Research at the ICMA Centre focuses on:
Quantitative ?nance;
Market microstructure;
Fund management;
Risk management; and
Regulation.
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* Research Centres in Wharton are predominantly responsible for organising and hosting conferences rather than
undertaking and organising research activity.
International Financial Services 170 International Financial Services International Financial Services
(i) Drivers of Research Activity
Feedback from the consultations identi?ed a number of key drivers of research activity. A summary of
these drivers is presented in the bullet points below. Further detail can be found in Table 5.14.
There was a consensus amongst the international academic institutions consulted in relation to the key
drivers of research activity, namely: personal faculty interests; industry interests and response to industry
developments/issues.
However, the overarching driver of research activity was considered to be the relevance of the research
undertaken to the ?nancial services industry.
Table 5.14 Research activity by the international ?nancial services education providers – drivers of
research activity
Skills/research
provider
Drivers of research activity
International
Education
Providers
The universities/colleges consulted with were in agreement in relation to what they considered to
be the key drivers of research activity. The areas stated were:
Personal interests;
Industry interests; and
Industry developments/issues.
The universities/colleges commented that research topics can be determined by individual faculty
members personal interests.
For example in Wharton, research is predominantly driven by individual faculty members. Finance
related research in NYU Stern can also be driven by individual faculty member’s interests, although
not to the same extent as Wharton.
Finance research can also be driven by industry research interests.
For example, NYU Stern noted that industry approach the Finance Department approximately three
times a year to undertake speci?c research projects.
Finally, important industry trends/issues were considered to drive ?nance research activity across
the universities/colleges consulted with as part of this study
For example, in NYU Stern and Wharton, this is facilitated by frequent discussions with industry via
research seminars. Conferences and workshops were also found to highlight areas of interest to
industry – this can in turn in?uence the type/area of research undertaken by Faculty.
However, regardless of what drives ?nancial services research activity, all universities/colleges
consulted, were of the opinion that the main importance of research is its high level of
industry relevance.
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International Financial Services International Financial Services International Financial Services 171
(ii) R&D Funding
Based on the output of the consultations with the leading academic institutions, funding for ?nancial
services research and development is provided from a range of sources including:
The university itself;
Industry;
Government/state bodies (e.g. National Science Foundation);
Not-for-pro?t organisations (e.g. Ford and Rockefeller Foundations);
Student fees from the delivery of executive and postgraduate courses; and
Subscription fees to ?nancial services databases.
Further detail and examples are provided in Table 5.15.
Table 5.15 Research activity by the international ?nancial services education providers – R&D funding
Skills/research
provider
R&D funding
International
Education
Providers
Sources of funding varied across the international universities/colleges reviewed, and typically
includes funding from:
University;
Industry;
Government/State Body; and
Not-for-pro?t organisations.
For example, the primary source of R&D funding in Wharton was cited as internal university
funding, which is covered by student tuition fees and executive education courses. It was reported
that they don’t receive any funding from industry for research.
In the Finance Department in NYU Stern however, sources of R&D funding include a mixture of
university, government grants (National Science Foundation), funding allocations from Not-for-
Pro?t organisations (Ford Foundation and Rockefeller Foundation) and industry funding. The
industry funding is predominantly obtained through their primary research Centre, the ‘Salomon
Centre’. However, in addition, the department receives funding from the university as well as the
other sources of external funding.
The ICMA Centre in Reading University is funded through a mixture of self-?nancing (through the
delivery of executive education and postgraduate courses), sponsorship from industry and various
grants. Subscriptions to ?nancial services databases are purchased annually by the university, some
of which is sponsored by industry.
The BNP Paribas Hedge Fund Centre in LBS is funded by BNP Paribas (a large six digit sum over a
3 year term). The contract does not determine the research undertaken but allows the Centre total
academic independence. In addition, BNP Paribas is a source of non-?nancial support and advice
to the Centre.
LBS also reported individual sponsorship of students from other sources including government/
not-for-pro?t organisation grants and industry funding for speci?c research projects.
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International Financial Services 172 International Financial Services International Financial Services
(iii) Level and Nature of Research Activity
A summary of the level and nature of research undertaken by the leading international academic
institutions consulted is presented in the bullet points below. Further detail and speci?c examples can be
found in Table 5.16 and 5.17.
The international institutions consulted have between 12 and 53 faculty members who are involved in
undertaking ?nancial services research.
Speci?c research areas were found to vary across the universities interviewed. However, a number of
broad research themes emerged, including: ?nancial markets; private equity research; econometric and
quantitative techniques/?nancial modelling; public policy; and globalisation.
Thereafter, the universities interviewed conducted research on a range of speci?c ?nance areas
including: pensions/life insurance; real estates; fund management, in particular alternative and hedge
fund markets; risk and compliance; and technology.
Table 5.16 Research activity by the international ?nancial services education providers – level/nature
of research activity
Skills/research
provider
Level and nature of research activity
International
Education
Providers
Table 4.42 (summary of research activity in the international institutions interviewed) provides an
overview of the level and nature of ?nancial services research activity in each of the international
universities interviewed.
The international institutions consulted have between 12 and 53 faculty members who are
involved in undertaking ?nancial services research. Cass has the largest number of academic staff
with 53 full-time faculty members, signi?cantly more than that of Reading with 12-15 ?nance
faculty involved in research. All remaining universities have between 23 and 45 faculty members
involved in ?nance research.
Speci?c research areas were found to vary across the universities interviewed. However, based on
a review of the ?nancial services research activities of the universities interviewed, a number of
broad research themes emerged, including:
i. Financial markets (e.g. credit and debt markets, NASDAQ [NYU]; ?nancial markets,
?uctuating ?nancial markets [Cass]);
ii. Private equity research (e.g. Cass);
iii. Econometric and quantitative techniques/?nancial modelling (e.g. econometric modelling
and forecasting [Cass]; quantitative modelling of hedge fund strategies [LBS]; ?nancial
econometrics [NYU]);
iv. Public policy (e.g. health and care, public policy, public policy issues affecting
Europe [Cass]); and
v. Globalisation (e.g. globalisation, global economics [Wharton]).
Thereafter, the universities interviewed conducted research on a range of speci?c ?nance
areas including:
i. Pensions/life insurance (e.g. pension micro-economics, pension fund-management; pension
funding and valuation, life insurance; mortality [Cass]);
ii. Real estates (e.g. real estate investment and portfolio management, real estate
securities [Cass]);
iii. Fund management, in particular alternative and hedge fund markets (e.g. quantitative
modelling of hedge fund strategies [LBS]; alternative investments [Cass]);
iv. Risk and compliance (e.g. law and regulation [Cass]; regulatory changes [Wharton]); and
v. Technology (e.g. Wharton; Cass).
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International Financial Services International Financial Services International Financial Services 173
(iv) Financial Services Research Centres
The prevalence of dedicated research centres within the leading international academic institutions
consulted is summarised below (please refer to Table 5.17 for additional detail and examples).
All of the international universities/colleges consulted with reported a minimum of one dedicated
?nancial services research centre focusing on a particular area within ?nancial services e.g. Salomon
centre in NYU Stern and Wharton (i.e. Financial Institutions Centre, the Weiss Centre and Rodney White
centres), and LBS BNP Paribas Hedge Fund Centre.
It was found that the nature and level of research conducted within the individual research centres
varied across the institutions.
Within Stern however the main purpose of the Salomon research centre was reported as being
the organisation of conferences and dissemination of research ?ndings rather that conducting the
actual research.
Table 5.17 Research activity by the international ?nancial services education providers –
research centres
Skills/research
provider
Financial services research centres
International
Education
Providers
Each of the international Universities/Colleges interviewed has one or more dedicated ?nancial
services research centre, however the level of research driven and conducted through these
centres varies.
For example, the ‘Salomon Centre’ in NYU Stern is the principal driver of ?nancial services related
research. It consists of seven research areas/themes and is the means through which ?nance
seminars and periodic conferences are organised.
In addition the ICMA Centre is the main driver of ?nance research in the University of Reading.
Wharton has three dedicated ?nance centres, namely:
Financial Institutions Centre;
Weiss Centre for International Financial Services Research; and
Rodney L. White Centre for Financial Research.
In contrast to NYU Stern, Wharton’s centres do not play a central role in ?nance research activity in
the University; rather their role is limited to organising conferences and the dissemination of
research. Research is not initiated or driven by these Centres, instead research is driven by in the
individual faculty members personal research interests.
Research in Cass Business School is predominantly driven through their 10 research centres,
clustered under the main areas of Finance, Management, Actuarial Science and Insurance.
Research is conducted in several areas including: Hedge Funds; Econometrics; Emerging Markets;
and Mathematical Finance.
LBS has a number of research institutes and research centres. Those speci?cally related to ?nancial
services include:
The Centre for Corporate Governance;
Private Equity Institute; and
The BNP Paribas Hedge Fund Centre.
The research initiatives undertaken in these Centres/Institutes are very much driven by the
individual faculty members.
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(v) Linking Research to Course Content
In terms of linking research back into course content the following points were highlighted.
It would appear that research ?ndings are fed back into course content within the international
institutions consulted.
The extent and timeliness of research ?ndings being fed back into course content was found to be
dependent on individual lecturers.
LBS’s Private Equity Institute feedback their research ?ndings to their students via regular conferences,
seminars and workshops.
It is more likely that research ?ndings will feed back at postgraduate levels rather than undergraduate
level due to the very often-complex nature of the research.
Table 5.18 Research activity by the international ?nancial services education providers – linking
research to courses
Skills/research
provider
Linking research to course content
International
Education
Providers
Each of the international universities/colleges interviewed reported that research is eventually fed
back to students, however this is more frequent at a postgraduate level, and depends on the
individual lecturer.
For example, NYU Stern reported that research ?ndings ?lter their way back to the classroom
eventually, however, the frequency and speed of sharing research depends on the individual
lecturer. In addition, this happens more frequently at PhD level, rather than MBS and
undergraduate, as those students form part of the human capital that undertake the research
initially (e.g. through a role as a research assistant, analysing data, etc).
LBS reported that ?ndings from research initiatives of the various Centres/Institutes are fed back
into course content. In particular the Private Equity Institute ensures transfer of the knowledge
back to students via regular conferences, seminars and workshops.
In addition, Wharton noted that research can be incorporated into course content, however this
depends on the individual lecturer and it is dif?cult to generalise for the whole University.
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(vi) Linking Research to Industry
Summary ?ndings of the consultations with the leading international academic institutions in relation to
the extent to which research ?ndings are linked back into industry are presented in the bullet points
below. A detailed review of ?ndings and speci?c examples can be found in Table 5.19.
Each of the international academic institutions consulted with reported some level of linking research
?ndings back to industry.
The manner in which research ?ndings are linked back can be categorised as formal and informal
via a number of different methods including conferences, industry workshops/seminars and
research centres.
The frequency of research being fed back to industry was found to range from weekly research
seminars to annual conferences.
Furthermore, research was cited as feeding back to industry via industry sponsorship of research and
research centres.
The consultees indicated that research ?ndings were fed back to industry on a more formal basis, in
some instances, particularly when the research Centre was sponsored by industry.
Table 5.19 Research activity by the international ?nancial services education providers – linking
research to industry
Skills/research
provider
Linking research to industry
International
Education
Providers
Based on the international institutions interviewed, ?nancial services related research is fed back
to industry both formally and informally, via a number of methods, including:
Conferences;
Research seminars;
Industry workshops/seminars;
Industry sponsorship of research/research centres; and
Other informal linkages with industry.
Both Wharton and NYU Stern cited conferences as an effective way to share and discuss research
with industry.
For example, through the ‘Salomon Research Centre’ in the Finance Department in NYU Stern, six
or seven conferences are organised annually, each addressing a particular ?nance area/issue. In
May 2007, the conference addressed ‘Derivatives 2007: New Ideas, New Instruments, New
Markets’ and was sponsored by International Securities Exchange and The NASDAQ Stock Market.
Approximately 300 people, both academic and industry, attend the conferences. These
conferences typically comprise a series of lectures given by representatives from industry,
regulatory bodies and academia.
Similar to how research ?ndings are fed back to students LBS’s research Centres/Institutes report
involving industry practitioners by inviting them to their various conferences, seminars and
workshops where research ?ndings are presented and discussed.
In addition, the three ?nance Research Centres in Wharton (further detail on research centres in
part (iv) of this section) are responsible for organising several conferences annually. Recent
conferences were centred around the following topics:
Model Governance and Model Validation;
Corporate Finance of Financial Intermediaries;
Innovation and Risk Management in Real Estate Markets; and
Financial Risk Management in Practice: The Known, the Unknown and the Unknowable.
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Skills/research
provider
Linking research to industry
International
Education
Providers
cont../
In addition, at Wharton, NYU Stern and Reading up to four Research Seminars are held weekly, to
which industry are invited.
In the ?nance department in Wharton, four research seminars are conducted per week, of which
two are industry-academic focused seminars. During the industry seminars, one to two academics
(from Wharton and from another University, e.g. NYU, MIT, Harvard, Rochester, University of
Chicago, etc) deliver presentations on a speci?c research topic, which is followed by a discussion
between industry and academia. Such seminars are considered to be the “centre of research
activity” and a “great way to learn what industry is interested in and what they are doing”.
Similarly, the ?nance department in NYU Stern hold three research seminars per week, 28 weeks a
year, which can be attended by industry representatives. Recent seminar topics include:
In?ation and the Price of Real Assets;
Financially Constrained Arbitrage and Cross-Market Contagion;
The Economics of Private Equity Funds;
Environmental Risk Insurance under Dynamic Moral Hazard; and
Phase-Locking and Switching Volatility in Hedge Funds.
In the ICMA Centre in Reading, one research seminar is held weekly, comprising approximately 30
people, of which a third consist of industry representatives. Lectures are delivered by both Reading
researchers and researchers from other universities. Topics vary from week to week – recent topics
included:
Does valuation method choice affect target price accuracy;
Mutual fund performance: skill or luck; and
Searching for a metric.
In terms of Industry Workshops/Seminars, industry hold workshops for academia from time-
to-time:
For example, in 2007 Lehmann Brothers in the US established a programme for academic staff in
US Universities. This programme consists of a series of lectures delivered by researchers/experts in
Lehmann Brothers which address a range of issues/research developments – academic staff can
pick and choose to attend the lectures which are most relevant to them. Wharton described this
programme to be:
An effective means of sharing and discussing research with industry;
A way of informing faculty members of the skills required of their students once they enter the
workforce; and
A means of giving faculty members ideas of potential research topics, which are relevant
to industry.
Through industry sponsorship of research/research centres, research ?ndings can be fed back
to industry.
For example, in the Salomon Centre in NYU Stern, a number of leading ?nancial services
companies donate $10,000-$15,000 annually for research, which in turn provides them with
advanced access to research ?ndings and free copies of all publications and working papers from
the centre.
Cass also report holding seminars/workshops which industry attend to ‘consume’ the ?ndings of
research projects.
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5.4 International Industry Linkages/Collaboration
To identify the linkages the leading international academic institutions have established with industry
feedback was gathered in the areas of: industry design of course content; industry delivery of course
content; internships/work placements; joint research programmes with industry; funding from industry;
and other evidence of industry participation. Feedback gathered under each of these headings is presented
in the following sections.
(i) Design of Course Content
Consultation with the leading international academic institutions highlighted the following points in
relation to industry’s involvement in the design of course content (please refer to Table 5.20 for detailed
?ndings and examples):
Industry involvement in the design of course content can be categorised as being formal or informal
in nature;
Contacts developed with industry through research, work placements, alumni, personal industry
contacts, can informally feed into the design of course content in the international education providers
interviewed; and
Some evidence of the formal design of course content by industry was also found in the international
education providers interviewed. For example, Adjunct Professors in NYU Stern design and deliver
several modules annually.
Table 5.20 Industry linkages for international ?nancial services education providers – design of
course content
Skills/research
provider
Design of course content
International
Education
Providers
There was some evidence of industry involvement in the design of ?nance course content found in
the international universities/colleges interviewed.
Contacts developed with industry through research, work placements, alumni, personal industry
contacts, can informally feed into the design of course content in the international education
providers interviewed. This is typically driven by the individual lecturer however.
There was some evidence found of the formal design of course content by industry.
For example, in the Finance Department in NYU Stern, Adjunct Professors (from industry) who
formally deliver some of the modules/programmes also design the content of that module. This is
usually in conjunction with another full-time academic staff to ensure no duplication of other
modules and an appropriate level of academic reference is included in the module.
In the ICMA Centre in Reading, a representative board from the International Capital Markets
Association reviews course content annually, offering feedback and suggestions on future
course material.
There were no reported instances of industry being involved in the design of course/module
material within LBS. However, as their staff includes ex-practitioners from industry this helps
ensure the relevance of course/module content.
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(ii) Delivery of Course Content
In relation to industry’s involvement in the delivery of course content the key ?ndings are summarised in
the bullet points below. Further detail and speci?c examples from the leading international academic
institutions consulted is presented in Table 5.21.
The use of industry representatives to deliver course content was found to be commonplace across all
international academic institutions consulted with. Wharton referred to their Finance Department
inviting guest lecturers from industry to speak and NYU Stern reported having 45 Adjunct Professors,
the majority of which are from industry (i.e. MD within Citigroup Global Finance Strategy Group and MD
within UBS Global Media Equity Research Team), who assist in the delivery of course content. In some
cases Adjunct Professors can be responsible for the delivery of full modules;
It was reported that very often it is industry who contact the academic institutions to suggest the
introduction and delivery of a new course or module;
It was also reported that on occasion industry approach academia with suggestions for a new module/
course, offering their services to assist with the delivery of the module/course; and
Cass Business School cited the bene?ts of using guest lecturers/adjunct lectures as providing a market
angle and complimenting the academic delivered content.
Table 5.21 Industry linkages for international ?nancial services education providers – delivery of
course content
Skills/research
provider
Delivery of course content
International
Education
Providers
Each of the international institutions interviewed use industry to deliver course content – this can
range from the use of occasional guest lecturers, to formally using Adjunct Professors from industry
to deliver entire modules/programmes.
For example, in Wharton Business School, the Finance Department invites industry representatives
as guest lecturers to speak regularly throughout the year. They note this is an excellent way for
students to “see theory put into practice”.
The Finance Department in NYU Stern has 45 Adjunct Professors, of which the majority are from
industry, who deliver modules/programmes in Finance. These modules are typically one of the
‘generic’ courses, including Topics in Corporate Finance, Investments and/or International Finance.
Many of the Adjunct Professors hold Senior Positions within their respective companies, for example:
Eric Lindenburg (Managing Director, Global Financial Strategy Group, Investment Banking
Division at Citigroup Global Markets) delivers a module under ‘Topics in Corporate Finance’
called Energy Markets and Instruments; and
Christopher Dixon (Managing Director of the Global Media Equity Research team at UBS)
teaches Financial Analysis in Media and Entertainment.
Rather than the university approaching industry for Adjunct Professors to deliver a new module, an
existing Adjunct professor or someone from industry may approach the ?nance school with
suggestions for a new module/course.
Cass also report than industry representatives are selected to conduct certain aspects of the
elective modules offered on their MSc programmes.
“They provide the market angle/practice side which nicely compliments the academic
delivered content.”
Guest lecturers are also incorporated into class delivery in the ICMA Centre in Reading. Guest
lecturers can deliver a short series of lectures on specialised topics, provide one-off lectures or
teach on their executive courses.
Furthermore, the Finance Faculty within LBS comprises ex-practitioners from industry. This allows
taught material to be related to the practical experiences of these faculty members.
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(iii) Internships/Work Placements
The following bullet points provide a summary of the key ?ndings in relation to the use of work
placements/internships amongst the leading international academic institutions consulted (refer to Table
5.22 for a detailed review and examples).
The use of work placements/internships was found to vary across the international institutions
consulted. For example Stern does not include internships in their undergraduate and PhD programmes
whereas both Wharton and Cass offer internships with ?nance companies, investment banks and fund
management companies.
The use of work placements/internships is typically more prevalent in undergraduate courses however
there was some evidence of linked research projects with industry at MSc level.
Cass and Wharton also stated that work placements/internships typically result in the offer of
permanent employment upon graduation.
There are also examples of some of the institutions consulted with e.g. ICMA Centre and LBS providing
trading room/hedge fund simulators as part of their course offering to students. This facility is also
offered for industry training.
Table 5.22 Industry linkages for international ?nancial services education providers – internships/
work placements
Skills/research
provider
Internship/Work placements
International
Education
Providers
The use of work placements is mixed across the universities interviewed.
For example, NYU Stern does not include internships in the undergraduate, MBA or PhD Finance
programme. However as part of the Finance MBA and undergraduate in Wharton, students
complete summer internships, the majority of which are with ?nance companies in New York.
Frequently, internships lead to offers of regular positions.
In Cass Business School, 3rd year students of their undergraduate courses complete an internship.
Typically this is conducted with an investment bank or fund management company. Students in
the past have also completed internships with American Express. It is estimated that 70 percent of
students who conduct an internship will be offered employment on graduating. Cass MSc
students, as part of their course, conduct a project with industry on a topic chosen by the
individual company. However, the length on the MSc courses (one year) does not allow for the
inclusion of a work placement or internship.
Although some of the international institutes don’t include work placements, simulated training
can be included to provide students with ‘on the job’ training.
For example, the ICMA Centre opened a 20 terminal dealing room in 1994. In 1998, a further two
dealing rooms opened with 30 Reuters equipped workstations and 30 workstations with software
similar to that found in investment banks. In 2007, the terminals in each room have been
upgraded with Reuters’ latest products – one with Reuters 3000Xtra, the other with the new
Reuters Trader product, (a web-based product students will be able to access from any workstation
in the Centre). The ICMA Centre will soon be the largest, non-investment bank, Reuters populated
facility in the world when a further 50 workstation ?agship dealing room. It will be equipped with
a combination of 3000 Xtra, Reuters Trader and Reuters Wealth Manager. Due to be completed in
October 2008, the facility will have a total of 112 workstations, which is comparable to a medium
sized investment bank’s dealing ?oor.
LBS’s BNP Paribas Hedge Fund Centre has a ‘Simulator for Hedge Fund Business’. This allows
teams (both students and industry) to manage Hedge Funds as a business i.e. decide where to
invest and how the money is spent.
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(iv) Joint Research Programmes
The bullet points below provide a summary of the key points highlighted from the international institution
consultations in relation to joint research programmes between industry and academia. A detailed review
and speci?c examples supporting these points can be found in Table 5.23.
There is some evidence of joint research programmes. For example, Stern stated that they are
frequently approached by industry requesting them to undertake speci?c pieces of research,
whereas, the ICMA Centre conducted research for following a successful outcome to a competitive
tendering process.
Research programmes are regularly funded by industry, seeking research on speci?c topics. This can
take the form of either direct contact from industry or response to a competitive tendering process.
More frequently than not, industry will fund research projects as opposed to have any direct
involvement in the research itself.
Table 5.23 Industry linkages for international ?nancial services education providers –
joint research programmes
Skills/research
provider
Joint research programmes
International
Education
Providers
There was some evidence of joint research programmes across the universities/colleges consulted
with. This typically takes the form of funding from industry for speci?c research initiatives.
For example, the Finance Department in NYU Stern, reported that industry approach them two to
three times a year requesting them to undertake a speci?c piece of research – funding is provided
by industry to undertake such research.
The ICMA Centre in Reading commented that speci?c pieces of research are often undertaken on
behalf of industry. These projects are typically obtained through competitive tendering for the
research, with industry funding the entire project. The Centre regularly have to turn down research
from industry due to a lack of capacity.
LBS reported joint research initiatives with industry an example of which is the BNP Paribas Hedge
Fund Centre’s collaboration with JP Morgan. In addition to this they also cited that individual
students very often receive sponsorship from industry to undertake speci?c research projects.
In addition, studies which require interviews with industry executives (e.g. survey of Financial
Services CEOs) are often conducted in conjunction with, or have support from, an organisation.
This gives the study an added credibility when approaching industry to arrange interviews.
There was some evidence of joint research initiatives being conducted between Cass and industry
in particular in the area of ‘Alternative Investments’. However it was stated that in the majority of
instances research is academically focused and industry’s role is as a ‘consumer ‘rather than having
direct involvement in conducting/Initiating the research.
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International Financial Services International Financial Services International Financial Services 181
(v) Funding from Industry
The key ?ndings in relation to the extent to which the leading international institutions consulted
receive funding from industry is reported in the points below (refer to Table 5.24 for further detail and
speci?c examples).
The level of industry funding was found to vary across the international institutions consulted.
Types of funding were reported as including: individual project funding; and funding for facilities and
infrastructure e.g. the International Capital Markets Association provided the University of Reading with
funding for the development of the ICMA Centre.
In addition to these funding sources, NYU Stern also commented that the Institutional Brokers
Estimates System in the US provides many universities with their data for free.
Furthermore industry was reported as providing funding for projects and conferences undertaken by
individual research centres. For example NYU Stern’s Salomon Centre is funded in part by corporate
associates which includes Morgan Stanley, PricewaterhouseCoopers, the New York Stock Exchange,
Reuters, Deutsche Bank and State Street.
Table 5.24 Industry linkages for international ?nancial services education providers –
funding from industry
Skills/research
provider
Funding from industry
International
Education
Providers
The level of funding received from industry varies across the international institutes interviewed. It
typically consists of:
Industry funding for individual research projects;
Provision/access to data for research;
Industry funding for research centres; and
Funding for facilities/infrastructure.
Across the institutions interviewed, some level of funding is received from industry for individual
research projects.
For example, Stern receives requests from industry to conduct research on a particular topic/area
approximately three/four times a year.
LBS reported a speci?c research projected undertaken on behalf of, and funded by, JP Morgan in
the area of ‘Investible Indexes’.
In addition, industry can provide universities/colleges with access to data if they research the
company or an area the company is interested in.
For example, the Finance Department in NYU Stern noted that the ‘Institutional Brokers Estimates
System’ in the USA has provided many Universities with their data for free, as the company itself
bene?ts from the research undertaken on their data – to date some 10,000 papers are available
which refer to the source data from this system.
There is also evidence of industry providing universities/colleges with funding for dedicated
?nance research centres.
For example, in NYU Stern, the research centre in the Finance Department, the ‘Salomon Centre’,
has created a structure of Corporate Associates through which a number of U.S. and international
?nancial institutions, institutional investors, securities exchanges, and corporations support
its activities.
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Skills/research
provider
Funding from industry
International
Education
Providers
cont../
Each Associate commits a limited amount of funds over a renewable ?ve-year period (typically
$10,000-$15,000 per annum), which underwrites faculty research and conferences conducted by
the Centre. The spending of such funding is unrestricted and can been spent on research as the
Centre sees appropriate. In return, industry receives:
Advance access to research ?ndings;
Invitation and attendance without charge to all Centre conferences and workshops;
Reduced cost attendance of executive programs in the Frontiers in Finance Series; and
Copies of all Centre publications and working papers.
There are approximately 30 Corporate Associates at present, including: Morgan Stanley; HSBC,
PricewaterhouseCoopers, New York Stock Exchange; Reuters; Deutsche Bank; and State Street.
LBS’s BNP Paribas Hedge Fund Centre is funded solely by BNP Paribas. The level of funding
provided is €1 million over a three year period. In addition to the ?nancial funding they also
receive business group level support from the company. This funding covers the academic
programme and visiting researcher programmes undertaken within the Centre.
There were also reports of industry funding for college facilities/infrastructure.
For example, the ‘International Capital Markets Association’ gave the University of Reading 3m to
construct and establish the ICMA Centre in 1995. The Centre was sponsored a further $5m from
the ICMA in 2006 for an extension to the existing Centre, which is currently under construction and
due for completion in October 2008. The new facilities will include a 50 seat ?ag dealing room;
150-seat lecture theatre; and a PhD study area.
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(vi) Other Industry Linkages/Collaboration
Consultations with the international ?nancial services education providers identi?ed a number of further
linkages with industry, with supporting details and speci?c examples presented in Table 5.25, including:
Sponsorship of competitions;
Consulting work; and
An ex-practitioner faculty.
Table 5.25 Industry linkages for international ?nancial services education providers –
other linkages/collaboration
Skills/research
provider
Other industry linkages/collaboration
International
Education
Providers
Other forms of industry linkages cited include:
i. Sponsorship of competitions: Lehmann Brothers sponsor a competition for the best PhD thesis
in the USA. A selection of students with the best theses are invited to New York to present to
an industry panel. This also bene?ts Lehmann Brothers who are presented with some of the
latest ?nance related research being undertaken.
ii. Consulting Work: In Wharton and NYU Stern, staff members are often used as external
consultants to the ?nance industry, e.g. hired to work on a speci?c issue, analyse data, etc.
iii. Faculty members may also have come from industry. For example, the new Dean of Cass is an
ex-practitioner. In addition, the head of the ICMA Centre in Reading and the Academic in
charge of the dealing room both worked as traders previously.
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5.5 Summary of International Financial Services Skills and Research Providers
The provision of ?nancial services education and training offered by the international institutions
interviewed is quite diverse, ranging from “broad” to “dedicated” courses. The vast majority however,
are “dedicated” ?nance courses covering areas such as ?nance, insurance, risk management, banking,
quantitative ?nance and actuary. The number of courses dedicated to speci?c ?nancial services sectors
(e.g. insurance, banking and capital markets and/or investment management) is relatively high (circa
44 percent). Importantly, the remaining “dedicated” ?nance courses also provide substantial potential
for sector specialisation through a combination of modules/electives. It should be recognised that this
is partly due to a function of scale, as the US and UK have a larger and more diverse economy, a larger
population and a leading ?nance sectors that can support a more varied/in-depth course provision,
than perhaps Ireland could.
Introduction of new course typically takes between 12 and 18 months, requiring a formal approval
process (internal and/or external), whereas the introduction of an individual module is substantially
quicker requiring a two to nine month time period. Minor changes to modules can happen on an
ongoing basis without formal approval.
Several processes are used by the international institutions to review course content including:
periodic university/department reviews; formal annual reviews; informal annual reviews (largely
dependent on individual lecturer); and continuous/on-going feedback (including feedback from
students and industry).
Mechanisms to ensure courses remain up-to-date with industry developments include: structured
industry involvement in course review, design and delivery through industry panels and the design and
delivery of ?nance modules by adjunct professors and ongoing fostering of informal industry linkages
through personal contacts and meetings with industry. Industry input from leading ?nancial services
companies was typically recognised as being vital to ensuring graduates enter the workforce with the
latest industry requirements.
There is a strong emphasis on ?nancial services research across the international academic
institutions interviewed. The key drivers of research activity included personal interests of the
academics; industry interests (e.g. industry approaching academia to undertake speci?c research
projects); and industry developments and issues (e.g. speci?c ?nance research Centres and research
seminars/conferences). Research activity was found to be funded by a combination of sources
including: the university themselves; industry; government; and not-for-pro?t organisations (e.g. Ford
Foundation in US, Welcome Trust in UK).
Each of the international institutions host at least one research centre; however functions of these
centres vary. The principle role of these centres is undertaking research activity, although some focus on
organising conferences and seminars around thought leadership and research ?ndings. International
academic institutions indicated that research ?ndings are regularly fed back to students, however, this
occurs more frequently at postgraduate level and depends on the individual lecturer. Research ?ndings
are fed back to industry via a number of methods including: academic/industry conferences; academic
research seminars which are attended by industry; industry workshops/seminars; and industry
sponsorship of research/research centres.
Industry linkages in the international institutes, both in terms of design, delivery and course
development or update, are well-developed, with evidence of structured industry input through
mechanisms such as those described above, in addition to the regular use of guest lecturers. The
prevalence of work-placements/internships with industry was found to vary across the international
institutions, ranging from none at all to limited to undergraduate/MBA courses only. There is signi?cant
evidence that the international academic institutions consulted with received funding/support from
industry for research initiatives, taking the form of: funding for research centres; joint-research
programmes; student sponsorship; and the provision of/access to data.
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International Financial Services 184 International Financial Services International Financial Services
5.6 Irish and International Skills and Research Providers – Gap Analysis
Table 5.26 summarises the key ?ndings of Part A and B by presenting the relative “gap” between the
education, training and research offered by the Irish education and training providers interviewed and the
offerings of a small number of leading international education and training providers. Following the
framework used to review ?nancial services education, training and research, the table is presented under
the headings of:
i. Course provision;
ii. Course development and update;
iii. Research activity; and
iv. Industry linkages/collaboration
In summary, the comparison of Irish and international providers highlights a number of areas in which
Ireland could develop its approach to ?nancial services education and training provision.
1. The provision of ?nancial services education and training is quite diverse in both the Irish and
international institutions interviewed, ranging from “broad” to “dedicated” ?nancial services courses,
however a greater proportion of courses are “broad” in nature in Ireland. Furthermore, course provision
in the US and UK appears to have a higher level of sector specialisation (through specialised courses
and/or choosing modules in a speci?c area) than their Irish counterparts. This can partly be recognised
as a function of scale, as the US and UK, with a larger population and leading ?nance industries, can
support a more varied and in-depth course scope. Despite this, there are some lessons to learn from
the international institutions on the nature of their ?nancial services education and training provision.
2. The ability of Irish third-level institutions to introduce new courses appears to be more limited than the
international universities with international institutions reporting signi?cantly shorter timescales. To
meet industry requirements however, some of the international universities develop several new
modules annually, rather than introducing a new course. This enables them to keep courses up-to-date
with the latest ?nancial services market trends and developments.
3. There is little evidence of inter-institutional collaboration in the design and delivery of courses in the
Irish universities/IoTs interviewed, although industry bodies reported collaboration with academia in
relation to course development. Conversely, inter-institutional collaboration, both nationally and
internationally, is commonplace in the international universities interviewed (e.g. joint delivery of MBA
programmes, etc).
4. Both Irish and international universities interviewed were found to be active in ?nancial services
research, with almost all universities interviewed having established one or more dedicated ?nance
research centres. It appears however, that the international universities interviewed place a stronger
emphasis on producing research that is industry relevant than their Irish counterparts. This can largely
be attributed to scale (i.e. the international universities interviewed have a much larger research
capacity than Irish universities – e.g. There are a total of 53 ?nancial services researchers across all of
universities interviewed in Ireland, however there is on average, 35 researchers in each international
institutions consulted) and the fact that, unlike Ireland, industry have shown a strong interest in
?nancial services research undertaken in the international universities interviewed. Internationally,
industry regularly discuss research ?ndings with the research centres and provide ?nancial support to
research centres/projects (e.g. through regular industry attendance at research seminars, conferences
and through sponsorship to establish research centres/speci?c research projects, etc). In the IMCA
International Financial Services International Financial Services International Financial Services 185
Centre in Reading University, Wharton and NYU, these research seminars are typically held two/three
times per week and consist of one to two academics delivering presentations on a speci?c research
topic to a group of 30/40 representatives from industry and academia.
5. Industry linkages in Ireland between industry and the Irish education providers, in terms of course
design/delivery, course development and update, funding and joint research programmes, are not as
well-developed as those in the international universities interviewed. There was strong evidence in the
international institutions of structured industry input (e.g. design and delivery of course content by
industry professionals, research and facilities funding by industry, and joint research programmes
between industry and academia).
Table 5.26 Comparison of education and research delivered by Irish and leading international
academic institutions
Criteria Description
Course
Provision
The majority of Irish ?nancial services courses tend to be “broad” in their covering business
studies, accounting, economics and mathematics/statistics. To a lesser extent, Irish institutions
deliver “dedicated” ?nancial services courses such as those covering ?nance, actuarial science,
insurance, banking and corporate ?nance. A limited number of sector speci?c/niche courses
are offered, the majority of which are tailored towards the banking and capital markets and
insurance sectors.
Course Category No. Courses Irish Courses
Broad 112 Bachelor of Business and Legal Studies (UCD), BSc Statistics
(NUIM, UCD), BA Accounting (WIT).
Dedicated 105 BA Accounting and Finance (DCU), Bachelor of Commerce
(banking and ?nance/insurance specialism) (UCD), BSc
Finance (UCC).
Sector 16 MSc Finance and Capital Markets (DCU), BA Actuarial and
Financial Studies (UCD); Specialist Diploma in Corporate
Banking (IoB).
Internationally, institutions also deliver a number of “broad” ?nance courses. However, the vast
majority are “dedicated” ?nance courses covering ?nance, insurance, risk management, banking,
quantitative ?nance and actuary amongst others. The number of courses dedicated to speci?c
sectors (e.g., banking and capital markets, investment management and/or insurance) is relatively
high. Importantly, the remaining “dedicated” ?nance courses also provide substantial potential for
sector specialisation through a combination of modules/electives.
Course Category No. Courses International Courses
Broad 11 MBS Accounting, Taxation and Law (NYU), BSc Statistics (Penn
State), PHD Accounting (LBS).
Dedicated 36 BSc Finance (NYU/Penn State), MSc Financial Risk Management
(Reading), MSc Finance (LBS).
Sector 19 BSc Banking and International Finance (Cass), BSc Insurance
and Risk Management (Penn), MSc in Investment Management
(Cass).
Niche modules - Fixed Income Strategies, Risk Management in Financial
Institutions, Equity Capital Markets, Hedge Funds – Investment
and Management (all MBA modules in SYU Stern).
International institutions have proportionately more sector focused/dedicated ?nancial services
courses/modules than Irish institutions.
International Financial Services 186 International Financial Services International Financial Services
Criteria Description
Course
Development
and Update
International institutions report shorter timescales for introducing new courses than Irish
institutions. They are also more inclined to keep courses relevant/up-to-date by introducing
new individual modules rather than full courses/programmes, which are more time consuming
to introduce due to the course/programme approval process. For example, a number of
modules in Stern have generic titles (e.g. ‘Topics in Corporate Finance’. ‘Topics in Investments’
and ‘Topics in International Finance’). This allows the ‘topic’ to be changed from year-to-year
depending on emerging issues/developments in ?nancial services and new ideas for modules
generated as a result. Changing a topic doesn’t require formal approval from the university and
can be introduced within a matter of days if required.
Internationally, academics proactively solicit views on their curriculum from industry players
and in many cases have mechanisms in place that formalise this arrangement. This input is
sought both for ‘complete courses’ and also for modules within courses. Due to the ?exibility
of modules, they are updated regularly to re?ect industry trends and drivers and to ensure
industry relevance of the materials covered. For example, in NYU Stern adjunct professors from
industry design and deliver a number of modules annually, and module topics are changed
each year to re?ect current market trends/developments. In Reading University course content
is reviewed annually by the International Capital Markets Association (ICMA), who originally
provided funding for the development of the ICMA Centre.
Currently, Ireland lacks a conduit to support or drive this level of interaction between industry
and academia and consequently such an initiative may need an ‘owner’ or ‘driver’ in the future
if it is to become a useful input to development and delivery. So, while Ireland is not as
advanced as the international education providers with regard to industry interaction, there is
evidence of programmes that have been developed with industry input and/or consultation.
For example, in the Business Information Systems Department in UCC, an ‘Advisory Business
Board’ was established to advise the Department on industry developments and future course
content. In addition, the IoB has jointly developed courses with UCD, to be delivered through
the upcoming ‘Global Finance Academy’ in UCD.
Irish institutions have longer processes for introducing new courses and have no inter-institutional
collaboration in the development of these.
International institutions tend to have formal mechanisms for interacting with industry to obtain
and input and feedback on course development. Similar initiatives are emerging in Ireland.
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Research
Activity
There is a strong emphasis on research within the international institutions. Although drivers
of research activity are similar in the Irish and international institutions, there is a greater
focus on industry relevance of the research undertaken in the international institutions than
the Irish institutions.
Irish institutions indicated that they receive limited funding from industry for research whereas
international institutions receive signi?cant levels of ?nancial support.
Research centres were found to be common-place in both Irish and international universities.
However the involvement of industry within these is limited to non-existent in Ireland. If
research is to become more industry relevant, then industry need to engage with the research
centres, both in terms of the identi?cation of thematic research areas and also in terms of
providing funding and support in return for outputs and ?ndings from the research. For
example, Wharton conducts two research seminars per week, which are attended by industry.
These consist of one to two academics delivering presentations on a speci?c research topic,
which is followed by a discussion between industry and academia. In addition, NYU Stern
organise several conferences annually, each addressing a particular ?nance area/issue.
Approximately 300 representatives from industry and academia typically attend these sessions.
The Salomon Centre in Stern has also created a structure of corporate associates, whereby
circa 30 ?nancial services related companies provide $10,000-$15,000 per annum to support
research activities.
Industry have shown a strong interest in research undertaken in the international universities,
and regularly discuss research ?ndings/provide ?nancial support to research centres/projects
Limited evidence of joint research activity between Irish institutions and industry, nor linking
research ?ndings back to industry.
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International Financial Services International Financial Services International Financial Services 187
Criteria Description
Industry
Linkages/
Collaboration
International institutions have extensive contact with industry to ensure industry relevance of
courses/modules.
Adjunct lectures are used more frequently within international institutions and often deliver full
modules. As noted above, there are 45 adjunct professors still working in industry in Stern
delivering a range of modules on recent industry developments. The use of industry
representatives to deliver modules is also commonplace in Cass and the ICMA Centre.
Industry funding of/support for research is more evident in international institutions – lack of
interest from industry reported by Irish institutions. For example, students in Stern receive data
for free from some ?nancial services companies, which can be very expensive for universities
to purchase. In LBS, their BNP Paribas Hedge Fund Centre is funded by BNP Paribas, with
signi?cant funding provided over a three year period.
Signi?cantly lower levels of collaboration between Irish universities and industry than international
institutions. Funding by Irish ?nancial services companies for research activity is also limited.
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International Financial Services 188 International Financial Services International Financial Services
Chapter 6: Research,
Development and Innovation
6.0 Introduction
The purpose of this chapter is to examine the extent to which international ?nancial services ?rms engage
in research and development (R&D) activities and to assess whether there is potential to leverage R&D as
an area of competitive advantage for Ireland. Speci?cally, the questions to be addressed include:
Do international ?nancial services companies engage in R&D activities?
What are the barriers to R&D investment?
What support structures could be developed to support R&D activities?
6.1 Background to R&D in Financial Services
As the importance of the services sector in the global economy has grown, so too has study into the role
and importance of research and development in the services sector, as traditional principles of R&D do not
appear to ?t as easily in an environment where there is no physical product to patent. As understanding of
services marketing has developed so has recognition that research and development does take place but
that this is quite different from the traditional laboratory-based research associated with manufacturing.
A 2005 study undertaken by the National Science Foundation (NSF) in the US into R&D in the services
sector used the ?nancial services sector as a case study. The NSF de?ned R&D activities as:
The planned, systematic pursuit of new knowledge or understanding toward general applications
(basic research);
The acquisition of knowledge or understanding to meet a speci?c, recognised need
(applied research); and
The application of knowledge or understanding toward the production or improvement of a product,
service, process, or method (development).
Based on the interviews undertaken to support the NSF study, it was found that these concepts of R&D did
not resonate well within the ?nancial services industry with none of the ?rms interviewed indicating that
they engaged in either basic or applied research
58
. Where examples of R&D were identi?ed the level
tended to vary depending on the type and size of the ?rm. Investment services ?rms were the main
organisations relying particularly heavily on technology to ensure that they could supply accurate and
complete information to investors to help differentiate their company from the competition
59
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58 NSF/NIST Measuring Service Sector Research and Development (2005).
59 Scottish Science Advisory Committee - Working Papers Series No. 6.
International Financial Services International Financial Services International Financial Services 189
However, this study also identi?ed a number of themes which suggested that “innovation” plays an
important role in supporting the development of the sector, such as
60
:
Increased competition and consolidation are forcing ?nancial services companies to innovate to
maintain pro?tability;
Dis-intermediation is forcing ?nancial services companies to lower costs by using more ef?cient
technologies and to move into new product and service areas; and
Across all areas of the industry there was evidence of a constant effort to innovate service offerings but
this typically took a different form from the traditional “laboratory based” R&D undertaken in the
manufacturing sector.
Industry consultations (both national and international) undertaken as part of this study supports the
?ndings of the NSF research, as the majority of industry respondents consulted cited that they did not have
a dedicated R&D function or budget. The instances where dedicated R&D facilities existed, these were
typically in the larger-scale organisations which offered a diversi?ed range of products and services and
were generally engaged in end-user information and service delivery e.g. Citigroup, Merrill Lynch and
Fidelity Technology Group. For these organisations technological capabilities are seen as being critical to
enabling the development of new products, processes and services. As a result, the associated R&D
initiatives tend to have a strong technology and process automation focus e.g. straight through processing.
Innovation
When questioned during industry consultations on the lack of R&D activity, recurring themes from
interviewees were that:
“change in the industry was evolutionary rather than revolutionary and therefore it was a case of
innovative tweaks rather than full-scale R&D that was required”
“product innovation was part of daily operations for certain areas in investment management but the
timelines did not allow for lengthy R&D cycles”
Interviewees found it much easier to articulate innovation activities that their organisations were engaged
in and were able to further categorise these by type of innovation:
Product innovation;
Technology innovation;
Process innovation; and
Team/Culture innovation.
Furthermore, most organisations’ efforts appeared to be focused on product and process innovations.
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60 Scottish Science Advisory Committee - Working Papers Series No. 6.
International Financial Services 190 International Financial Services International Financial Services
A recent study by McKinsey’s found that a majority of executives (54 percent) believed that innovation was
more challenging for ?nancial services ?rms than for other companies due to the focus on short-term
?nancial returns. Despite this fact, 57 percent considered innovation to be extremely or very important to
the ability of their company to meet revenue targets over the past three years
61
.
Interestingly, this study investigated the reasons for innovation being particularly challenging for ?nancial
services. The main reasons identi?ed were:
Short-term ?nancial success is expected in everything we do and innovation initiatives often result in
short term losses;
The resources needed to pursue innovation initiatives aren’t allocated because these resources are
critical to short term execution;
Organisational mechanisms that would encourage the generation of new ideas and their execution
don’t exist in the industry;
The industry is mature and as a result opportunities to innovate are limited; and
The industry lacks insight into consumer needs and behaviour.
It is worth noting that the McKinsey survey found that 40 percent of respondents stated that “their
company lacks organisational mechanisms to facilitate innovation” with only 26 percent stating that “funds
were dedicated to support innovation activities”. This suggests that the required support structures within
?nancial services are relatively immature.
Despite the low priority given to R&D activities among many of the organisations interviewed, a number of
examples were identi?ed which placed signi?cant emphasis on this activity, and viewed it as being crucial
to their organisations future success. Importantly, it was suggested that investment in technology based
RD&I could provide a “high value” area of focus for Ireland, which if successfully supported, could result in
further expansion and leverage of the high-end IT skills base which has already been established.
These R&D initiatives would likely focus on using IT to automate existing manual processes and
interventions (particularly in back-of?ce functions), and to automate risk reporting and compliance
monitoring activities. Positioning Ireland as a solutions centre for the development of enabling
technologies for the sector could provide a sustainable knowledge based platform for further growth while
enhancing the strategic role of operations located in Ireland. It should be noted that some industry
representatives commented that this was the strategy that India was seeking to pursue in an effort to
expand its global presence in the sector.
However, in order to facilitate further investment in RD&I activities it was suggested that a number of
barriers to investment should be eliminated, these are outlined overleaf.
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61 Innovation in Financial Services – A McKinsey Global Survey 2007.
International Financial Services International Financial Services International Financial Services 191
6.2 Barriers to RD&I
In summary, a number of barriers to RD&I were identi?ed during the interview programme:
A lack of collaboration between industry and educational institutions to support industry relevant
advanced research;
A lack of understanding of best practice processes for innovation in the services sector;
The ?nancial risks associated with large-scale investments in establishing RD&I facilities with no
guaranteed returns; and
The lack of government incentives/support for technology companies to support development of
leading-edge software solutions for the sector.
Measures which assisted in reducing these barriers could result in a step-change in the level of RD&I
activities being based in Ireland and the development of a distinctive competency as a “solutions centre”
for ?nancial services advancement.
6.3 Support Structures
The Centre for Financial Services Skills (the Centre), which is described in the next chapter, could form a
central support for the industry in terms of advancing the research agenda. In particular, operations at the
Centre could assist in eliminating some of the main barriers to RD&I by:
Providing a mechanism to build closer linkages between industry and educational providers by
exchanging information on their respective needs;
Providing self-study educational resources (without charge) to improve understanding across a wider
cross-section of the population/industry; and
Co-ordinating the call for tenders and award of funding to support the provision of strategically
important skills development and research initiatives.
In addition, by providing a mechanism to foster closer linkages between industry and academia the
existing “high-value” and scarce resources of the academic world could be leveraged to address industry
challenges. The ?nancial theory which underpins the operation of the international ?nancial services sector
e.g. option pricing models, are typically advanced through mainstream “academic” research. Whilst pricing
of individual products involves elements which are proprietary to each company, it was suggested that
research into industry relevant themes could be accelerated through improved linkages with academia. By
harnessing existing academic resources through coordinated initiatives to focus on selected research
topics, it was suggested that the sector in Ireland could achieve a competitive advantage by successfully
positioning itself at the leading edge of some of the more complex niche elements of the sector.
This should increase the quality of innovation initiatives and support the positioning of Ireland as a
solutions centre for international ?nancial services.
Finally, having a structure which facilitates discrete research initiatives could assist in addressing some of
the scale issues, by providing access to top-level research and technology resources to smaller and
medium sized organisations, who otherwise might not have the demand or resources to support their own
dedicated RD&I function.
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International Financial Services 192 International Financial Services International Financial Services
6.4 Summary
Research suggests that the international ?nancial services sector does not engage in signi?cant amounts of
“traditional” research and development activity. Where R&D investments are undertaken, it is typically by
the larger scale organisations which offer diversi?ed products and services and where they are typically
engaged in end-user delivery. Technology plays a critical role in enabling the delivery and processing of
?nancial services products, and where companies are making signi?cant investments in RD&I, these
typically have a technology focus.
It was suggested that the potential exists to position Ireland as a “solutions centre” for the development of
enabling technologies for the international ?nancial services sector, as this could provide a sustainable
knowledge-based platform which builds upon our existing ICT presence. This would provide a driver for
achieving operational ef?ciencies, which would support continued growth and enhancement of the
strategic role of operations located in Ireland.
The term “innovation” has a greater resonance with the majority of ?nancial services organisations, and in
many cases innovation is viewed as being an integral part of maintaining competitiveness. Several of the
companies interviewed were actively pursuing opportunities to improve their products and processes
through innovation initiatives.
A number of barriers to RD&I were identi?ed, which included:
A lack of collaboration between industry and educational institutions;
A lack of understanding of best practice processes for innovation;
The ?nancial risks associated with scale investments in R&D; and
The lack of government incentives/supports.
Initiatives designed to increase the levels of RD&I activity in Ireland must ?rst seek to overcome
these barriers.
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International Financial Services International Financial Services International Financial Services 193
Chapter 7: A Centre
7.0 Origin of the Centre
The concept of a Centre for Financial Services Skills, which would form a central support for the industry in
the areas of education, training and research, was proposed in the Building on Success report published by
the Department of the Taoiseach and the Clearing House Group. Some of the key points articulated by
Building on Success are highlighted below.
“In order to sustain and grow our attractiveness as a location for international ?nancial services, Ireland
needs a Centre for Financial Services Skills.
“The Centre will ensure a coordinated and cohesive approach to educational provision. Collaboration
and competition will be cornerstones of the Centre – within the Centre collaborating institutions will
compete with each other to deliver educational programmes and win research contracts.”
“The establishment of the Centre and the appointment of the Director will take place after a
competitive process following the submission of proposals from collaborating institutions.”
(Building on Success, page 31)
The form that this Centre should take was not explicitly de?ned in Building on Success.
7.1 Expert Group on Future Skills Needs Consultation Process
Subsequent to this, and following on from a speci?c recommendation in the report, the Expert Group on
Future Skills Needs (EGFSN) was asked to undertake a study into the skills and research requirements of
the International Financial Services industry. One of the strands of the Terms of Reference of this project
requested the EGFSN to “provide policy advice on the role of the Centre for Financial Services Skills”.
Further, the EGFSN was also asked to provide advice on the form of the proposed Centre.
As an input, opinions were sought from education and training providers and industry on the form the
proposed Centre might take. On balance, the consensus from both academia and industry was that a
Centre should provide a single point of contact for both industry and academia, while having responsibility
for ensuring that the skills and resources required to support the development of the industry are available.
Furthermore, it was suggested that a Centre would have responsibility for the coordination of education,
training and research (facilitating discussions with, and ensuring involvement between, both academia and
industry) as well as the promotion of the industry, in particular opportunities within it, in order to attract
suf?cient numbers of new employees from all groups i.e. secondary school students, back-to-work parents,
third level graduates, other industry sectors and overseas.
Table 7.1 summarises the feedback received.
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International Financial Services 194 International Financial Services International Financial Services
Table 7.1 Feedback from consultations on the key principles for the proposed Centre
Industry Academia
Role and remit A mechanism that provides a single point of
contact for industry to ensure that the
required resources and skills are available to
support the development of the sector. This
could be achieved by:
Promoting the sector’s requirements in
schools and colleges;
Co-ordinating skills development at a
range of levels;
Facilitating feedback to education
providers on industry skills needs, and
Co-ordinating industry relevant research.
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Not a provider of education and
training but rather a forum for industry
and education and training providers
to interact on research activity. A forum
to facilitate identi?cation of industry
skills requirements.
Courses should be developed in
response to ‘requests for proposal’ from
a Centre.
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Structure Hub and spoke model with
relationship managers.
Virtual Centre – no physical location, or else
very small presence.
Board comprising industry and academia.
Scale Small – avoid duplication of resources and
existing infrastructure.
Small entity, which is not duplicating any
existing education providers’ resources.
Funding Must be government sponsored to begin
with – possibly some co-funding/
sponsorship at a later stage from industry.
Government sponsorship to establish Centre.
Centre to obtain industry funding
for research.
Skills delivery Should not be another skills delivery agency
although could provide some introductory
materials to help smaller ?rms.
Not a provider of education and training. Use
existing education infrastructure to deliver
new courses if necessary.
Research Coordination of research into industry
selected themes.
Coordination of research – Centre should
help identify relevant areas of research.
Consortiums of universities/colleges should
tender for speci?c research projects and
funding via the Centre (which are supported
by/relevant to industry).
Role and Remit
There was general consensus from both academia and industry in respect of the role of a Centre. In order
to best serve the sector and all its stakeholders, a Centre should provide a single point of contact for both
industry and academia, while having responsibility for ensuring that the required resources and skills are
available to support the development of the sector.
Within this overall role, it was suggested that a Centre have the following congruent responsibilities:
Coordination role – education and training: A Centre should be the conduit for coordinating the
demands of industry with the supply of skills from training and education providers. In this regard, a
Centre will need to ensure appropriate communications channels are established with both
constituents, with a view to providing a mechanism/forum through which industry’s views can be
articulated and through which skills providers can clearly de?ne and test the syllabus, with a view to
developing new courses or modifying existing courses to make them more industry-relevant. The
consultation forum will also provide a mechanism through which education and training providers can
engage with industry to solicit their views on, and input to, course review and delivery. It also provides
the opportunity for both parties to agree a framework for incorporating placements and internships into
some of the longer-term courses;
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International Financial Services International Financial Services International Financial Services 195
This coordination role is relevant across all training and education providers, from post-leaving
certi?cate level to postgraduate level. In terms of training and education providers it would include: the
third level institutions; the industry trainers/professional bodies; private skills providers; and
government training agencies such as FÁS, etc;
Coordination role – research: Similar to the education and training coordination role described above,
a Centre should also be the conduit through which the industry and academics discuss and identify
research themes; share research approaches; provide input to the research process; share industry data,
where applicable; and present and discuss research ?ndings. This joint approach to research occurs
internationally, however, there is little evidence of this collaboration nationally. In the absence of this
occurring organically, a Centre would have a role to drive the development of the research agenda by
encouraging collaboration on research projects both industry-academic and inter-institutional that
provide practical and implementable solutions from an industry perspective; and
Promotion role: The development of the international ?nancial services sector requires the attraction of
signi?cant numbers of new employees to the sector to address both current skills and capacity gaps
and to deliver on the growth plans for the sector. Against this background, it is important that all
potential sources of employees are aware of the opportunities in the sector. This will start with
knowledge of the sector and an awareness of the opportunities within it. The promotion should be
aimed at all potential employee groups from secondary school students to back-to-work parents to
third level graduates, amongst others.
Structure and Scale
One of the key requirements of a Centre is that it avoids duplicating existing resources and facilities, but
rather leverages current investment in educational, training and research infrastructure. On that basis a
Centre would operate at a policy and strategic level as opposed to providing education and training
materials and facilities.
A board or advisory group would be required to steer the work of a Centre. Such a group would need
to be representative of industry players; educational providers; and other interested stakeholders,
as appropriate.
Funding
In order to be effective a Centre will require funding to support its initiatives and activities. During
consultations it was suggested that initial funding be provided by government in order to mobilise the
Centre and its stakeholders, establish a presence and develop a track record in the delivery of programmes
and initiatives that are bene?cial to its stakeholders.
Once mobilised, funding should be sought from industry in return for relevant outputs, whether they be
research programmes or skills development initiatives. There are many examples of industry funding for
international training and research activities such as, the BNP Paribas sponsorship of the Hedge Fund
Research Centre based in London Business School, where research is undertaken into quantitative
modelling of hedge fund strategies.
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International Financial Services 196 International Financial Services International Financial Services
Education, Training and Research Delivery Mechanisms
As mentioned earlier, it is not envisaged that additional delivery mechanisms be established, but rather
that existing infrastructures be leveraged.
Therefore it is envisaged that once the need for an educational or training course/module is identi?ed that
a Centre could potentially draft the course speci?cation, which would then be circulated to potential
bidders by way of a request to bid for the course provision. A Centre would assess the bids and identify the
preferred supplier, against pre-determined criteria, and award the contract for the course development and
delivery to the preferred bidder. Thereafter a Centre would have a role in monitoring the delivery of the
course. The course would be reviewed regularly, with a view to updating or terminating the course, based
on participant and industry feedback.
The research delivery mechanism would be similar, with research teams preparing proposals in response
to research requests. The timeframe for, and use of outputs from, the research would need to be agreed
amongst the parties involved.
7.2 Potential Models for the Centre
Figure 7.1 provides a graphical illustration of the possible elements of a Centre.
International Financial Services International Financial Services International Financial Services 197
Figure 7.1 Elements of a centre
The model outlined above is designed to re?ect the balance of opinion expressed during the consultation
process. However, the EGFSN ask that the following considerations be taken into account if a Centre is to
be developed.
Education
& Training
Providers
Link to World Class
Educational Institutes
Board/Advisory Body
International
Financial
Services
Industry
Industry & Academic Collaboration
Identification of industry education and training requirements
Identification of industry relevant research projects
Coordination of placements and internships
Education & Training Development Research Development
Advanced Skills
Short courses in specialised
skills (e.g. new practises
such as ‘softing &
bundling’ international
trends in middle office
operations etc.)
Developmental Skills
Facilitate the exchange of
industry needs and skills
development supply
Identification of course
specifications
Award of contracts for the
development of international
financial services courses
Co-ordination of industry
seminars/conferences
Entry Level Skills
Distribution of foundational
e-learning and training
solutions to support the
FS sector e.g. ‘life of a trade’
and fund administration
training
Provide links to enabling
services (educational/3rd
party technology providers)
to support:
?Processs Innovation
?Technology Innovation
?Advanced Quantitive
Research
Central point to commission
‘theoretical‘ research
engagements while providing
a single source to coordinate
industry data & funding
Selection and framing of
research problems
Award of research contracts
to research teams
Promotion of Employment in International Financial Services
Information on, and promotion of, the international financial
services industry – materials for career guidance; job
descriptions; industry background etc.
International Financial Services 198 International Financial Services International Financial Services
Consideration should be given to how a Centre will interact with the current enterprise development
apparatus of the State. Any mechanism should be complementary to existing mechanisms and leverage
the expertise of existing State agencies.
While recognising the need for a relatively light structure, if developed, a Centre would need to have a
clearly articulated mandate and power to in?uence in a meaningful way the skills and research agendas
outlined in this report. Clear guidelines should be developed describing how the proposed structure
and activities of a Centre will derive its authority to in?uence and execute the functions and the
agendas that it may be assigned.
As well as establishing the mandate of a Centre, it will be crucial that it be provided with adequate
resources, budgets and reporting lines to ful?l any mandate it may be given.
The Governance of any new entity needs to complement existing mechanisms for public/private
collaboration. Existing entities’ roles e.g. the Clearing House Group need to be clearly de?ned vis-à-vis
any proposed Centre.
7.3 Next Steps
The development of a Centre should not been seen as an end in itself and should not slow progress on
addressing the skills and research gaps outlined in this report. In ?nalising its recommendations, the Expert
Group has identi?ed the next steps which current stakeholders should take in order to progress the
signi?cant skills agenda which exist for the International Financial Services Sector. The development of an
alternative mechanism such as a Centre may over time provide a forum to continually address these issues,
but its absence in the short term should not de?ect attention from the core issues at hand.
It is not possible at this point to identify the level of funding required. Funding, however, needs to be
considered in the context of the National Development Plan. There is an immediate job of work to be
undertaken in identifying what education and training provision and research can be undertaken within
current resources and what additional funding is required and available to address the remaining gaps
recognising that both the State and industry have a role to play.
?
?
?
?
International Financial Services International Financial Services International Financial Services 199
Chapter 8: Recommendations
8.0 Introduction
This section outlines a number of recommendations based on the preceding research and consultations.
Due to the diverse nature of the international ?nancial services industry, it is clear that no single solution
will meet all of the challenges facing the sector from a skills perspective. It is also clear, however, that there
is a sense of urgency, amongst both policymakers and amongst the industry itself, to take immediate action
to rectify some of the more pressing issues. This will help to protect the existing industry in Ireland, which
in turn can act as the foundation for its future development and expansion.
The preceding chapters have outlined a range of challenges facing the industry. Essentially, the challenges
can be grouped under four broad headings:
To urgently tackle current skills needs;
To address staff retention issues;
To put in place a skills pipeline that a) meets the likely future needs of the sector, and b) delivers a
supply of high skilled workers that can help to build the knowledge economy and shape the type of
industry that develops in Ireland; and
To put in place the infrastructure (from a skills perspective) that will allow a ?nancial services research
agenda to develop in Ireland.
With this in mind, the EGFSN has identi?ed recommendations requiring immediate speci?c action, and
others which will need to be implemented over a longer time frame. The recommendations proposed
address a range of issues and are illustrated in Figure 8.1.
Figure 8.1 Range of actions required
?
?
?
?
Research
Awareness
Promotion
HRM
Training
Solution
Education
International Financial Services 200 International Financial Services International Financial Services
In addition to the ?ve areas outlined above, there is a need for enhanced communications between all
stakeholders and a number of recommendations are proposed to achieve this.
Each recommendation has a set of associated ‘next steps’ that must be taken to ensure that the
international ?nancial services industry in Ireland has a sustainable future, and indeed can continue to
develop and undertake higher-value functions in the future. These recommendations are summarised
brie?y below, and are looked at in more detail in subsequent sections.
8.1 Summary of Recommendations
This report contains 6 key recommendations, incorporating 18 different elements:
Education: Increase the supply of graduates emerging from formal education with appropriate skill
sets to meet the needs of the industry. This will require the introduction of new education and training
modules and courses at graduate, postgraduate and professional level;
Training: Introduce improved training mechanisms to upskill new entrants into the industry. In
particular, the requirement to expand the pool of labour available to IFS ?rms will require an expansion
of the supply of foundation level skills;
Human Resource Management: In order to expand the supply of labour available to international
?nancial services ?rms, innovative approaches to Human Resource Management are required;
Awareness/Promotion: More effective career advice and promotion is required in order to highlight
the attractiveness of career opportunities on offer in the industry;
Research: Establish a ?nancial services research capability in collaboration with industry tasked with
developing leading edge thinking and solutions that are shared through structured industry fora; and
Communications and Collaboration: Establish a forum to facilitate inter-institutional academic
collaboration with industry to support course development and delivery.
1.
2.
3.
4.
5.
6.
International Financial Services International Financial Services International Financial Services 201
8.2 Detailed Recommendations
Table 8.1 contains a summary description of the recommendations with further details on each
recommendation provided on the following pages.
Table 8.1 Recommendations proposed by EGFSN
1 Education: Increase the
supply of graduates emerging
from formal education with
appropriate skill sets to meet the
needs of the international
?nancial services industry. This
will require the introduction of
new education and training
modules and/or courses at
graduate, postgraduate and
professional level.
Increase the numbers of graduates and postgraduates undertaking courses
and modules appropriate to the needs of the international ?nancial
services industry. Speci?cally, this requires the development of new
modules and, where appropriate, new courses designed speci?cally to
meet the needs identi?ed in this report. Mathematical and technological
skills sets are fundamental to the sector.
Provide opportunities to specialise in speci?c areas of international
?nancial services through elective modules e.g. derivatives structuring,
risk management, ?nancial modelling etc.
?
?
Next Steps
(i) The ?nancial services industry, through the of?ces of Financial Services Ireland (FSI) should collectively agree on
short-term priorities in relation to their skills needs as set out in this report in early 2008.
(ii) Higher Education Institutes (HEIs) should be provided with an opportunity to respond to the contents of this
report. The Higher Education Authority (HEA) should facilitate this consultation in early 2008. HEIs responses
should identify opportunities to address the recommendations within current funding; identify opportunities to
introduce modules onto existing programmes; and outline planned provision.
(iii) The HEA and FSI should work together through the Clearing House Group to agree an action plan to deliver the
prioritised skills sets. The Clearing House Group has established a subgroup to facilitate this process.
(iv) Having completed steps (i)-(iii) and identi?ed the remaining gaps that cannot be met through existing provision
and funding, the HEA should, subject to funding, issue a call for proposals.
2 Training: Introduce improved
training mechanisms to
upskill new entrants into the
industry. In particular, the
requirement to expand the
pool of labour available to IFS
?rms will require an expansion
of the supply of foundation
level skills.
Develop mechanisms to support rapid skills development to ensure that
resources can develop the requisite understanding of the sector and
pro?ciency in core areas e.g. 8-week intensive course incorporating
simulated environments.
?
Next Steps
(i) FÁS currently offers a number of courses relevant to the international ?nancial services sector such as its hedge
fund administration course and is seeking to expand its offerings in the ?nancial services sphere in 2008. The
development of these programmes should be prioritised in consultation with industry.
(ii) The Clearing House Group subgroup supported by the Development Agencies should seek proposals from other
education and training providers such as the Vocational Education Colleges (VECs) and professional institutes to
deliver these skills.
International Financial Services 202 International Financial Services International Financial Services
3 Human Resource Management:
In order to expand the supply of
labour available to international
?nancial services ?rms,
innovative approaches to
Human Resource Management
are required.
Evaluate the core skills and competencies required to operate at
foundation level and develop competency pro?les for standard roles e.g.
client servicing, funds administration.
Identify alternative labour pools e.g. school leavers, parents returning to
the workplace, well educated migrant workers currently employed in other
sectors, who are capable of performing foundation level roles and of
meeting probable skills needs.
In order to boost the stock of human capital, both ?rms and education
providers should recruit world-class talent, regardless of where that talent
is to be found. This requires a ?exible and attractive immigration system
that minimises the burden on both individuals and their employers.
?
?
?
Next Steps
(i) A forum is required to bring together the HR managers from IFS companies to develop responses and share best
HR practices. This could be addressed by the Shared Services Forum.
62

(ii) The EGFSN should continue to monitor the skills requirements of the international ?nancial services industry
and communicate these needs to the Employment Permits section of the Department of Enterprise, Trade
and Employment.
4 Awareness/Promotion:
More effective career advice
and promotion is required
to highlight the career
opportunities on offer in the
international ?nancial
services industry.
Promotion of ?nancial services career paths to second level students, with
a particular focus on high-level mathematics students.
Promotion of career opportunities to third-level students, focusing on
students in business/?nance, mathematics/statistics, engineering and
technology courses.
Identi?cation and targeting of promotional activities towards speci?c
population groups e.g. parents returning to the labour market, those
changing careers, migrants working in other sectors.
?
?
?
Next Steps
(i) The industry, coordinated by Financial Services Ireland, and supported by IDA Ireland and FÁS, should develop a
strategy for careers information. These bodies should ensure that all those involved with the provision of career
guidance and information are fully aware of the positive career opportunities within the industry.
5 Research: Establish an
international ?nancial services
research capability in
collaboration with industry
tasked with developing leading
edge thinking and solutions
which are shared through
structured industry fora.
Identi?cation of key thematic areas of research by academia, that are
relevant to industry requirements/interests.
Sharing of research undertaken by academia with industry via ‘research
seminars’ and ‘conferences’.
Research themes should also be expanded to include new subjects in the
humanities and emerging disciplines such as behavioural economics
Interaction between academia and leading international researchers and
education and training providers to identify innovative areas of research.
Additional research funding to academia from industry e.g. sponsorship of
research projects, research centres and provision of data.
?
?
?
?
?
Next Steps
(i) IDA Ireland, Enterprise Ireland, HEA and SFI on an on-going basis will facilitate a forum for industry and academia
to jointly agree a research agenda that will be mutually bene?cial. The ?rst forum should be held in early 2008.
(ii) Existing funding sources SFI, the Irish Research Council for Science, Engineering and Technology (IRCSET) and the
Irish Research Council for the Humanities and Social Sciences (IRCHSS)) should be leveraged in order to progress
the international ?nancial services research agenda.
(iii) SFI plans to increase its funding of research in the area of ?nancial mathematics over the coming years. Any
funding should be cognisant of the ?ndings of this report.
(iv) Similarly, the Development Agencies currently operate a number of schemes to support their companies in
undertaking R&D activities research funding in the area of IFS. In particular, IDA Ireland is developing concepts
and speci?cally targeting R&D from ?nancial services companies.
62 The Shared Services Forum was established in 1998 as a joint initiative between the IDA and Whirlpool. Its objectives are to (i) share knowledge and
experiences of member organisations; (ii) maximize synergies generated from the combined interests of the group and the organisations they
represent; (iii) discuss and debate issues that affect competitiveness; (iv) provide updates on developments within industry; and networking.
International Financial Services International Financial Services International Financial Services 203
6 Communications and
Collaboration: Encourage
academic collaboration
with industry to support
course development and
delivery at graduate and
postgraduate level.
Improve linkages between academia and industry
to ensure the relevance of course curricula and research topics.
Increase the frequency of course reviews and reduce the time taken to
revise course contents.
Examine mechanisms that provide for greater ?exibility in introducing
topical, practical and industry relevant modules and courses.
Encourage the use of industry placements and internships as part of
course delivery.
?
?
?
?
Next Steps
(i) An on going mechanism is required to facilitate academic – industry collaboration. In the short term, the HEA
and FSI should facilitate a forum between industry and academia to discuss the skills needs outlined in this
report. This forum should take place on foot of the consultations undertaken in relation to recommendation 1,
which deals with the supply of graduates. Such a forum should take place in early 2008.
International Financial Services 204 International Financial Services International Financial Services
Recommendation 1 Education: Increase the supply of graduates emerging from formal education with
appropriate skill sets to meet the needs of the international ?nancial services industry.
This will require the introduction of new education and training modules and/or courses,
at graduate, postgraduate and professional level.
Key Actions Increase the numbers of graduates and postgraduates undertaking courses and
modules appropriate to the needs of the IFS industry. Speci?cally, this requires the
development of new modules and, where appropriate, new courses designed
speci?cally to meet the needs identi?ed in this report. Mathematical and
technological skills sets are fundamental to the sector.
Provide opportunities to specialise in speci?c areas of international ?nancial services
through elective modules e.g. derivatives structuring, risk management, ?nancial
modelling etc.
?
?
Education and training provision at all levels has serviced the IFS industry well to date. It is now a matter of
continuous improvement and maintaining relevance. During the industry consultation programme, senior
international ?nancial services industry leaders indicated a lack of availability of certain suitably skilled
resources to meet their current requirements for certain roles which are shown in the table below. This
mirrors closely the ?ndings from the FÁS/SLMRU research that highlighted a number of key skills needs in
the sector.
In addition, and based on expected opportunities for the industry to grow and develop over the medium
term, a number of future skills areas have been identi?ed which should provide a focus for supply-side
initiatives targeted at addressing these anticipated industry needs. The skills needs of the industry will
evolve continuously and this will need to be re?ected in future revisions to course curricula.
Table 8.2 Summary of current and future skills needs
Current and future Future
1. Maths/Economics/Quantitative Modelling
2. Accountancy (with funds experience)
3. Risk Management
4. Compliance
5. Middle-management with ?nancial
services experience
6. Project and change management
7. Funds servicing and banking back-of?ce
8. Actuary
1. Derivatives structuring
2. Quantitative analysis
3. Credit analysis
4. Hybrid technologists – business analysis with
IT/systems skills
5. Business development with detailed product
knowledge/industry quali?cations
6. Pan-European tax/legal specialists
7. Behavioural economists
8. Funds servicing – client relationship management for
complex products
9. Fluency in European languages
10. International compliance
This study has highlighted the dynamic nature of the international ?nancial services sector, and the
importance of the availability of suitably skilled resources in ensuring the stability of highly mobile
investment. In addition, industry representatives have forecast areas of likely growth and the resulting skills
development challenges over the medium term. This information provides direction for educational course
developers which will assist them in designing future course curricula to ensure these are relevant in
meeting the industry’s projected skills needs. Based on the estimated current and future demand for skills
and the skills areas outlined above, it is recommended that a programme of various courses and modules
be developed in response.
International Financial Services International Financial Services International Financial Services 205
The matrix in Table 8.3 sets out a framework for this course development, based on current and expected
future industry needs. This list is intended to be indicative of the types of courses and modules required. It
is likely that some of the courses (particularly at postgraduate level) could be bundled together and
delivered jointly.
During the course of consultations, it was also suggested that the depth of content/knowledge needed to
be reviewed, as it was suggested that the Irish system was structured to produce “skilled generalists” rather
than “specialists”. Course curricula in the US facilitate a higher degree of specialisation by allowing students
to choose elective modules, thereby achieving higher levels of pro?ciency in their chosen area. This is
attractive from an industry perspective as it generally reduces the learning curve and time taken to achieve
pro?ciency for new recruits upon entering the workforce. If higher levels of specialisation are combined
with “hands-on” experience or simulated environments then the ability of graduates to quickly integrate
and add value to an organisation would be greatly increased.
On the other hand, there is a need to provide a broad education at undergraduate level to allow students
to develop and avail of future opportunities. There is a need to strike a balance in this regard. Introducing
up-to-date, industry-relevant modules on an on going basis is a mechanism to do this.
Table 8.3 Summary of the nature and content of new courseware
Skill demand Course topics/contents Course features (delivery, scale, etc)
Graduate level
Maths/Economics/
Quantitative
Modelling
General Mathematics and Economics degree
programmes with a focus on higher-level
quantitative skills. Modules might include:
Econometrics;
Quantitative modelling in C++;
Product development;
Product modelling;
Asset pricing; and
Stochastic modelling.
?
?
?
?
?
?
?
Degree programme.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (approx 20 per annum).
?
?
?
?
Accountancy with
funds experience
Accounting courses with a focus on fund
accounting (modular format).
Degree programme with
professional exams.
Incorporating applied/case study
elements from funds servicing
environments.
Work experience.
Medium volume (300+ per annum).
?
?
?
?
Risk Management General Risk Management courses with
modules covering:
Risk management in ?nancial institutions;
International risk management;
Risk modelling;
Regulation; and
Compliance.
Reference course – BSc in Insurance and Risk
Management offered by Penn State and BSc in
Investment and Financial Risk Management
offered by Cass.
?
?
?
?
?
Degree programme.
Specialised modules incorporated into
existing degree programmes.
Incorporating applied/case study
elements from ?nancial services
Work experience.
Low volume (<50 per annum).
?
?
?
?
?
International Financial Services 206 International Financial Services International Financial Services
Quantitative
?nancial analysis
Quantitative ?nance/Mathematics courses with
modules in the following areas:
Technical skills in quantitative
?nancial analysis;
Quant asset management;
Financial engineering;
Quantitative strategic analysis; and
Quantitative strategy implementation.
?
?
?
?
?
Degree programme.
Specialised modules incorporated into
existing degree programmes.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (approx 20 per annum).
?
?
?
?
?
Credit analysis General Financial services degree programmes
with modules in:
Financial analysis technology;
Scenario modelling;
Credit analysis and rating interpretation;
Company research; and
Asset quality/Forensic.
?
?
?
?
?
Degree programme.
Specialised modules incorporated into
existing degree programmes.
Incorporating applied/case study
elements from ?nancial services.
Work experience.
Low volume (approx 20 per annum).
?
?
?
?
?
Hybrid technologists
– business analysis
with IT/systems
skills
IT Courses with a speci?c focus on ?nancial
services, including:
Applying IT to ?nancial services;
Financial products;
Financial modelling;
Product development; and
Business systems analysis.
?
?
?
?
?
Degree programme or 6 month/1 year
graduate diploma programme/
conversion course to provide
graduates from IT courses with basic
?nancial services skills.
Classroom based.
Medium volume
(approx 100 per annum).
?
?
?
Business
development with
detailed product
knowledge/industry
quali?cations
Incorporation of ?nancial services aspect into
general Business/Marketing courses:
Topics might include:
Introduction/background to international
?nancial services;
Products, services and markets; and
Financial products and markets.
?
?
?
Certi?cate course/module providing
business and marketing graduates
with an understanding of ?nancial
products and instruments.
Medium volume
(approx 80 per annum).
?
?
Middle-
management with
?nancial services
experience
Incorporation of following skills into ?nancial
services related courses:
General business skills;
Marketing skills;
Business development skills; and
Effective communication skills.
?
?
?
?
Certi?cate course/conversion course
providing a basic understanding of
?nancial products and instruments,
the IFS sector and general
management training.
Medium volume
(approx 80 per annum).
?
?
Postgraduate level
Compliance/
International
compliance
Provision of specialist programmes/research into
the area of international regulation and
compliance. Including modules in:
Audit principles; and
System controls.
Reference course – MSc in Capital Markets,
Regulation and Compliance.
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx. 30 per annum).
?
?
?
Risk Management Provision of specialist programme/research in
relation to:
Risk management in ?nancial institutions;
Risk modelling; and
Added quantitative techniques.
Reference course - MSc in Financial Risk
Management as offered by Reading University.
?
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx 20 per annum).
?
?
?
International Financial Services International Financial Services International Financial Services 207
Derivatives
structuring
Specialist Derivative programme including
modules in:
Financial engineering;
Dynamic asset pricing theory;
Portfolio risk analysis;
Credit risk and Derivative products; and
Stochastic modelling.
?
?
?
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx 20 per annum).
?
?
?
Behavioural
economics
Economic specialist programme with a focus on:
Economic theory;
Behavioural science;
Rational theory;
Momentum investing; and
Arbitrage.
?
?
?
?
?
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx 20 per annum).
?
?
?
Project and change
management
Certi?cate in Project Management incorporating
modules such as:
Project management procedures
and techniques;
Project planning and control;
Quality management; and
Earned value analysis.
?
?
?
?
Certi?cate course in project
management best practices
incorporating ?nancial services
case studies.
Medium volume
(approx 80 per annum).
?
?
Pan-European tax/
legal specialists
Specialist programme for tax and legal graduates
to provide an international perspective.
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx 20 per annum).
?
?
?
Actuary Specialist Actuarial programme with particular
reference to the international ?nancial
service sector.
For example – MSc in Actuarial Science and
MSc in Actuarial Management as offered by
Cass university.
Specialist programme.
Incorporating applied/case study
elements from ?nancial services.
Low volume (approx 20 per annum).
?
?
?
In essence at foundation level the requirement is for short courses with ?exible delivery mechanisms,
aimed at bringing alternative populations of personnel (back) into the workforce in high numbers.
At undergraduate – graduate level the emphasis is on both:
Developing specialised modules that can be updated regularly to re?ect industry trends and
incorporated into existing degrees programmes; and
Developing new or updating existing degree programmes to tailor their contents to improve their
focus on particular skills demands e.g. tailored towards hybrid technologists or credit analysts.
Where appropriate, applied or case study elements and work experience should be incorporated
into these programmes. Some of these courses/modules may be best delivered by the
professional bodies.
The postgraduate proposition is for specialist programmes of varying length focused on particular
specialist skills e.g. international compliance, behavioural economics, etc. Again these courses should
incorporate applied or case study elements. The focus at this level is primarily on new courses, which are
dynamic in nature, re?ecting latest industry trends.
?
?
International Financial Services 208 International Financial Services International Financial Services
Alongside the traditional business and ?nance courses, increasing product and pricing complexity and
focus on process ef?ciency have placed a greater demand on advanced mathematical and computing/IT
skills as “core” ?nancial skills for the sector. Therefore, action is required to create greater linkages between
the courses that produce advanced mathematical and technology skills to ensure that these incorporate
modules that facilitate these graduate being deployed in a ?nancial services environment. Speci?cally,
these measures should:
Target secondary school students with a view to increasing the numbers taking maths and science-
based courses at higher levels by highlighting the employment opportunities for people with these
skills in key roles in the ?nancial services sector e.g. trading, risk management and portfolio
management. There are, however, a wide range of issues in this regard which are outside the scope of
this report; and
Technology based courses need to evolve from a focus on pure software development towards a
greater emphasis on problem solving and innovation. With increased outsourcing of development
activities to other territories, technology functions in international ?nancial services in Ireland are
increasingly focusing on higher value problem solving roles which require business process and systems
analysis skills. These technology skills will be critical to positioning Ireland as a centre for developing
?nancial services solutions.
Next Steps
(i) The international ?nancial services industry, through the of?ces of Financial Services Ireland (FSI)
should collectively agree on short-term priorities in relation to their skills needs as set out in this
report in early 2008.
(ii) Higher Education Institutes should be provided with an opportunity to respond to the contents
of this report. The Higher Education Authority (HEA) should facilitate this consultation in early
2008. HEIs responses should identify opportunities to address the recommendations within
current funding; identify opportunities to introduce modules into existing programmes; and outline
planned provision.
(iii) The HEA and FSI should work together through the Clearing House Group to agree an action plan to
deliver the prioritised skills sets. The Clearing House Group has established a subgroup to facilitate
this process.
(iv) Having completed steps (i)-(iii) and identi?ed the remaining gaps that cannot be met through
existing provision and funding, the HEA should, subject to funding, issue a call for proposals.
?
?
International Financial Services International Financial Services International Financial Services 209
Recommendation 2 Training: Introduce improved training mechanisms to upskill new entrants into the
industry. In particular, the requirement to expand the pool of labour available to
international ?nancial services ?rms will require an expansion of the supply of
foundation level skills.
Key Actions Develop mechanisms to support rapid skills development to ensure that resources
can develop the requisite understanding of the sector and pro?ciency in core areas
e.g. 8-week intensive course incorporating simulated environments.
?
This recommendation is linked with Recommendation 3 which addresses the need to expand the pool of
labour available to IFS companies. There is a need to ensure that both existing and potential employees in
the IFS sector are equipped with the appropriate skills sets to meet the needs of the industry.
It has been suggested by the industry representatives that mechanisms should be examined to facilitate
up-skilling of these alternative populations in Ireland in relevant areas, which could be achieved through a
range of FÁS, post-leaving certi?cate, VEC or industry-led, accredited short courses and training
programmes. Thus, a two pronged approach is required, one aspect focused on new entrants at
foundation level and the other focused on the appropriate deployment of graduates. This could provide a
signi?cant boost to the total labour supply and provide a more stable foundation upon which to expand
the overall sector.
Table 8.4 provides guidance on indicative course features designed to address the requirements for
foundation level skills.
Table 8.4 Summary of the nature and content of new courseware
Skill demand Course topics/contents Course features (delivery, scale, etc)
Foundation level
Funds servicing and
banking back-of?ce
Introductory Funds Industry course with
modules including:
Basic accounting; and
Principles of fund administration (Valuation,
Settlements, Custody and Corporate Actions).
?
?
Short duration 8-12 weeks.
Flexible delivery mechanisms to
include distance learning/web.
Simulated environments/
work experience.
Scaleable model to facilitate high
volume and regional delivery up to
1,500/annum.
?
?
?
?
Funds servicing –
client relationship
management for
complex products
Introductory Funds Industry course with
modules including:
Basic accounting;
Principles of fund administration;
Effective communications; and
Client Relationship Management.
?
?
?
?
Short duration 8-12 weeks.
Flexible delivery mechanisms to
include distance learning/web.
Simulated environments/
work experience.
Scaleable model to facilitate medium
to high volume up to 200/annum.
?
?
?
?
Fluency in European
languages
Inclusion of modules in general ?nancial services
courses, including:
Business and legal language training; and
International business ?nance.
?
?
Modular training incorporating.
Aural training.
Low volume (<50 per annum).
?
?
?
International Financial Services 210 International Financial Services International Financial Services
Next Steps
(i) FÁS currently offers a number of courses relevant to the international ?nancial services sector
such as its hedge fund administration course and is seeking to expand its offerings in the ?nancial
services sphere in 2008. The development of these programmes should be prioritised in consultation
with industry.
(ii) The Clearing House Group subgroup supported by the Development Agencies should seek proposals
from other education and training providers such as the VECs and professional institutes to deliver
these skills.
International Financial Services International Financial Services International Financial Services 211
Recommendation 3 Human Resource Management: In order to expand the supply of labour available to
international ?nancial services ?rms, innovative approaches to Human Resource
Management are required.
Key Actions Evaluate the core skills and competencies required to operate at foundation
level and develop competency pro?les for standard roles e.g. client servicing,
funds administration.
Identify alternative labour pools e.g. school leavers, parents returning to the
workplace, well educated migrant workers currently employed in other sectors,
who are capable of performing foundation level roles and of meeting probable
skills needs.
In order to boost the stock of human capital, both ?rms and education providers
should recruit world-class talent, regardless of where that talent is to be found. This
requires a ?exible and attractive immigration system which minimises the burden
on both individuals and their employers.
?
?
?
Signi?cant attention has been accorded to the problems associated with high-skills needs in IFS. While
undoubtedly the supply of high skilled graduates and experience specialists is fundamental to the
development of the industry, a large supply of skills at other points along the skills spectrum is important.
In order to provide a foundation for the development of higher value activities in IFS in the future, we must
protect current investments and ensure that the existing cadre of IFS ?rms can continue to operate
successfully in Ireland. Essentially, the availability of a supply of suitably skilled labour at competitive rates
is a critical prerequisite to further growth.
Industry consultations showed that many ?rms are currently experiencing dif?culties in hiring and retaining
resources for certain foundation level (operational and administrative) roles, which do not require
advanced/specialist education.
The current industry practice of targeting degree level graduates to ?ll the majority of foundation level roles
appears to be a contributory factor to attrition levels, as highly mobile graduates are more likely to have
attained educational competencies, which they perceive as excessive for some of the more administrative
entry-level roles. A similar experience in the US led several ?rms to focus on “alternative populations” to
ful?l many of these roles e.g. school leavers, parents returning to the labour force, ex-military etc. It may
also be possible to attract well-educated migrant workers from other sectors to this sector, where their
quali?cations may be more appropriately applied.
In addition, developing a stable core of resources for less specialised tasks increases the potential to free-
up graduates to focus on the more complex areas, which should be more aligned with their education and
competencies. Increasing product complexity has resulted in a greater need for analytical and problem
solving capabilities in some of the more advanced operational functions. Therefore, increasing the overall
capacity will facilitate maximising the potential of the labour resources by ensuring that resources are
focused on tasks that are appropriately matched to their skills and competencies.
Next Steps
(i) A forum is required to bring together the HR managers from IFS companies to develop responses and
share best HR practices. This could be addressed by the Shared Services Forum
63
.
(ii) The EGFSN should continue to monitor the skills requirements of the international ?nancial services
industry and communicate these needs to the Employment Permits section of the Department of
Enterprise, Trade and Employment.
63 The Shared Services Forum” was established in 1998 as a joint initiative between the IDA and Whirlpool. Its objectives are to (i) share knowledge and
experiences of member organisations; (ii) maximize synergies generated from the combined interests of the group and the organisations they
represent; (iii) discuss and debate issues that affect competitiveness; (iv) provide updates on developments within industry; and networking.
International Financial Services 212 International Financial Services International Financial Services
Recommendation 4 Awareness/Promotion: More effective career advice and promotion is required to
highlight the career opportunities on offer in the international ?nancial
services industry.
Key Actions Promotion of ?nancial services career paths to second level students, with a
particular focus on high-level mathematics students.
Promotion of career opportunities to third-level students, focusing on students in
business/?nance, mathematics/statistics, engineering and technology courses.
Identi?cation and targeting of promotional activities towards speci?c population
groups, e.g. parents returning to the labour force, those changing careers, migrant
populations, etc.
?
?
?
The shortfall of employees in the international ?nancial services industry in Ireland can be partially
attributed to a lack of awareness/knowledge of potential career opportunities within the international
?nancial services industry. This is particularly relevant in an economy with a tight labour market. Further,
given the nature of skills being sought (i.e. competency in mathematics etc.), IFS ?rms are in competition
with other high-tech sectors such as ICT and engineering for the same ?nite pool of potential employees.
One way to impact positively on the shortage of employees is to effectively promote the choice of careers
in ?nancial services to secondary school and third level students. Potential entrants into employment in IFS
must be made aware of the bene?ts of choosing such a career – the selling points should encompass all
elements of a career in the industry, from the relatively high salaries on offer, to the potential for career
progression, to the international nature of the industry.
More speci?cally, at second level, career advisors play a pivotal role in the promotion of careers in the
international ?nancial services industry. Several activities at school level should be considered to improve
the image/knowledge of the industry, including:
Improved exposure to the industry through presentations by industry to local secondary schools;
Increasing collaboration between school career advisors and industry professionals
64
; and
Efforts by secondary schools to identify and to foster interested students prior to sixth year.
A particular focus should be placed on educating/identifying students that study high-level mathematics.
Initiatives to promote the awareness/image of the international ?nancial services industry at third
level include:
Regular presentations delivered to university/college students by industry professionals
65
; and
Annual ?nancial services career fairs
66
.
Students enrolled in business and ?nance courses, as well as ?nance-related courses with a high
quantitative focus, such as maths, statistics and engineering should be targeted in particular.
?
?
?
?
?
64 Such interaction could include the provision of information on the international ?nancial services industry to career advisors and structured meetings
between industry professionals and secondary schools/career advisors.
65 Presentations should be made by industry professional from across the international ?nancial services industry outlining potential career opportunities
within speci?c sectors.
66 Career Fairs should comprise representatives from the international ?nancial services industry, private ?nancial services organisations and
government agencies.
International Financial Services International Financial Services International Financial Services 213
In addition to these more captive target groups, there is a need to promote the career opportunities for
alternative groups (e.g. parents returning to the labour force, those changing careers, migrants working in
other sectors, etc). Appropriate communications channels and materials to heighten awareness among
these populations should be developed.
Next Steps
(i) The industry, coordinated by Financial Services Ireland, and supported by IDA Ireland and FÁS, should
develop a strategy for careers information. These bodies should ensure that all those involved with
the provision of career guidance and information are fully aware of the positive career opportunities
within the industry.
International Financial Services 214 International Financial Services International Financial Services
Recommendation 5 Research: Establish a ?nancial services research capability in collaboration with
industry tasked with developing leading edge thinking and solutions that are shared
through structured industry fora.
Key Actions Identi?cation of key thematic areas of research by academia, that are relevant to
industry requirements/interests.
Sharing of research undertaken by academia with industry via ‘research seminars’
and ‘conferences’.
Research themes should also be expanded to include new subjects in the
humanities and emerging disciplines such as behavioural economics.
Interaction between academia and leading international researchers and education
and training providers to identify innovative areas of research.
Additional research funding to academia from industry, e.g. sponsorship of research
projects, research centres and provision of data.
?
?
?
?
?
In the US in particular, much of the international ?nancial services research is based on topics proposed by
industry and is supported by industry. In Ireland, it appears that there is less industry involvement in
academic research projects and consequently there is a need to develop initiatives to encourage a
collaborative approach to the identi?cation and execution of research projects.
Such initiatives may include:
The establishment of ‘research seminars’ that provide an opportunity for academics to present and
discuss research results to representatives from both industry and universities/Institutes of Technology/
industry bodies
67
;
The establishment of regular industry-academic conferences addressing relevant industry topics
68
; and
Industry sponsorship of/involvement in research projects and/or dedicated ?nancial services
research centres.
If research is to become more industry relevant, it is imperative for industry to engage with the universities
and IoTs and their respective research centres, both in terms of the identi?cation of thematic research
areas and also in terms of providing funding and support in return for outputs and ?ndings from the
research. Some topical research areas might include:
Streamlining business processes through technology to automate back-of?ce functions such as trade
settlement and reporting;
Advanced pricing models;
Regulatory and compliance reporting; and
Product innovation.
As mentioned previously, the vast majority of ?nancial services research activities will rely on resources
with detailed process knowledge gained through practical experience of the business combined with
resources with software engineering skills. The more “academic” research elements will require a small
number (approximately 10 in the medium term) of highly quantitative specialists who are capable of
evolving current industry models through focused research projects.
?
?
?
?
?
?
?
67 Research Seminars should be conducted weekly and include representatives from both industry and academia. These should consist of academics
(from research institutions in Ireland and potentially internationally) and/or industry representatives delivering presentations on industry relevant
research topics, followed by a discussion between industry and academia.
68 Conferences could range from one to two days in length and comprise a series of lectures given by representatives from industry and academia on a
speci?c relevant ?nancial service research topic. For example, recent conferences in Wharton Business School were centred around: Model Governance
and Model Validation; Corporate Finance of Financial Intermediaries; and Financial Risk Management in Practice: The Known, the Unknown and
the Unknowable.
International Financial Services International Financial Services International Financial Services 215
For “best-in-class” research to be undertaken, in addition to Government funding, there is a need
for industry to provide ?nancial support to ?nancial services research initiatives. This can take a number of
forms, including:
Direct sponsorship of research projects;
Sponsorship of/donations to dedicated ?nancial services research centres; and
Provision/sponsorship of data for research purposes
69
.
The current SFI model for funding research already requires researchers to engage with industry in the
manner described in this report. SFI is currently funding research into ?nancial mathematics, for example
the Mathematics Consortium for Science and Industry (MACSI) at the University of Limerick is investigating
Pricing models for collateralized debt obligations in partnership with the Market Risk Division, DEPFA Bank
plc, and SFI’s Research Frontiers Programme has also funded ?nancial mathematics. Further investments
into research in this area are in the pipeline.
To further enhance their research capability and to gain access to and knowledge of leading international
research, academic institutions should develop formal partnerships with their leading international
counterparts through mechanisms such as:
Teacher or student exchange; and
The development of joint research projects.
These relationships will provide a mechanism to gain access to global industry-based research, expertise
and innovation.
It is recognised that there are dif?culties in working collaboratively when it comes to ownership of
intellectual property, and consequently further consideration should be given to this area.
Next Steps
(i) IDA Ireland, Enterprise Ireland, HEA and Science Foundation Ireland (SFI) on an ongoing basis will
facilitate a forum for industry and academia to jointly agree a research agenda that will be mutually
bene?cial. The ?rst forum should be held in early 2008.
(ii) Existing funding sources (such as Science Foundation Ireland (SFI), the Irish Research Council for
Science, Engineering and Technology (IRCSET) and the Irish Research Council for the Humanities
and Social Sciences
70
(IRCHSS)) should be leveraged in order to progress the ?nancial services
research agenda.
(iii) SFI plans to increase its funding of research in the area of ?nancial mathematics over the coming
years. Any funding should be cognisant of the ?ndings of this report.
(iv) Similarly, the Development Agencies currently operate a number of schemes to support their
companies in undertaking R&D activities research funding in the area of IFS. In particular, IDA Ireland
is developing concepts and speci?cally targeting R&D from ?nancial services companies.
?
?
?
?
?
69 Purchasing data/data licences annually is a huge expense for research institutions.
70 IRCSET and IRCHSS do not provide funding according to de?ned themes. Rather, the focus is on funding innovative, original and exploratory research,
aimed at generating new knowledge and energising Ireland’s future growth, development and national competitiveness.
International Financial Services 216 International Financial Services International Financial Services
Recommendation 6 Communications and Collaboration: Encourage academic collaboration
with industry to support course development and delivery at graduate and
postgraduate level.
Key Actions Improve linkages between academia and industry to ensure the relevance of course
curricula and research topics.
Increase the frequency of course reviews and reduce the time taken to revise
course contents.
Examine mechanisms that provide for greater ?exibility in introducing topical,
practical and industry relevant modules and courses.
Encourage the use of industry placements and internships as part of course delivery.
?
?
?
?
It appears that there is limited interaction between academic stakeholders involved in international
?nancial services education and training, and the industry itself (although there are some examples of
good practice in Ireland). Internationally, it has been shown that the development of such relationships
brings signi?cant bene?ts and where this has happened in Ireland to date considerable bene?ts have
accrued to the Irish education and training providers. The interaction occurs at two levels:
Academia-industry; and
Inter-institutional/college.
There are a range of initiatives that can support both.
Academic-industry collaboration should occur across a number of different strands. Firstly, to ensure that
?nancial services education and training remain relevant to industry skills requirements, industry should be
involved in the identi?cation of the relevance of ?nancial services courses/course material. Keeping courses
relevant to industry will require a strong industry input into course review and update. This study suggests
the following three actions to support this input:
At department/faculty level, the development of ‘Industry Advisory Boards/Industry Panels’ to provide a
formal and distinct industry input into programme and syllabus review, design and update
71
;
At course level, the inclusion of industry representatives on Course Review Boards to provide structured
industry input into course design and development, review and update
72
; and
The development of more consistent interaction by the education and training providers with the
international ?nancial services industry
73
.
Mechanisms need to be put in place which will allow for the introduction of new modules within a short
timeframe. A possible strategy is for education and training providers to introduce modules with generic
titles (e.g. ‘Topics in Corporate Finance’, ‘Topics in Investment Management’) and change module content
as required based on industry skills requirements/trends and developments. Content of modules should
be changed without requiring formal approval from the university/IoT.
?
?
?
?
?
71 Industry Advisory Boards/Industry Panels should be developed at department/faculty level and should consist of a membership that brings together
leading industry professionals, who would meet 2-4 times a year to discuss course-related development requirements.
72 Course Review Boards would be independent of the formal accreditation bodies, but operating with the approval of the accreditation bodies. These
panels should have the power to signi?cantly modify course content without prior approval and should consist of both leading industry experts and
academic experts who would oversee the quality and scope of course material.
73 This could include the formal networks of industry linkages at each university or college, the active development and promotion of more joint industry-
academic events (e.g. seminars, conferences) and more joint industry-academic research into ?nancial services sector, trends and developments.
International Financial Services International Financial Services International Financial Services 217
Secondly, industry should be involved in the delivery of ?nancial services education and training on a more
frequent basis. This should take the form of:
A formal guest lecturer programme, e.g. course/module requirements to use a certain number of guest
lecturers annually; and
Use of industry professionals to design and deliver entire modules
74
.
Course curricula should incorporate “applied” elements to improve the “market readiness” of students
to take on roles within the sector. A number of methods could be used to achieve this, including:
Simulated environments
75
;
Practical project work; and
Co-delivery of classes with industry representatives.
A mechanism to assist undergraduates to avail of work placement opportunities in international
?nancial services ?rms should be examined and course developers should seek to increase the number
of courses that incorporate placements as a mandatory component. This was identi?ed by industry as a
signi?cant gap versus the US and continental European systems. The industry has a key role to play in
providing such work placement opportunities.
In addition, students would bene?t from broader curricula that incorporate “soft skills” training in key areas
such as communications, report writing, customer service and client management.
Flexible delivery mechanisms need to be examined for postgraduate/continuing professional development
courses. Several industry respondents cited “outdated” course delivery methods as a key barrier to using
the third level educational infrastructure as course durations were viewed as being too long and resulting
in too much time away from the job. Options which include a greater emphasis on practical experience
and distance learning methods could assist in addressing this gap.
Finally, further inter-institutional collaboration is required both between education and training providers
within Ireland, and between Irish and leading international education and training providers. In particular,
potential inter-institutional development and running of courses, on a joint basis, should be explored. This
will help to leverage synergies in college strengths and potentially avoid duplication of materials/content
development and delivery
76
.
Next Steps
(i) An ongoing mechanism is required to facilitate academic – industry collaboration. In the short term,
the HEA and FSI should facilitate a forum between industry and academia to discuss the skills needs
outlined in this report. This forum should take place on foot of the consultations undertaken in
relation to Recommendation 1, which deals with the supply of graduates. Such a forum should take
place in early 2008.
?
?
?
?
?
?
?
74 International Finance’. ‘Topics’ can be changed from year-to-year depending on emerging issues/developments in ?nancial services and
new ideas generated for modules as a result and can be changed within a matter of days if required. They are typically designed and delivered
industry professionals.
75 Industry professionals should be responsible for/involved in the design of module content, which will act as a means to ensure industry relevance of
course material.
76 Such simulated environments can include ‘trading rooms’ which can allow students to work in simulated training environments, and learning how to
trade while in an academic environment. Such training was noted as extremely bene?cial for students when entering the workforce.
International Financial Services 218 International Financial Services International Financial Services
Appendix A: Glossary of Terms
The table below provides a glossary of technical terms used in this report.
ABS Asset Backed Securities are a type of bond or note that is based on pools of assets, or
collateralized by the cash ?ows from a speci?ed pool of underlying assets. Assets are pooled
to make otherwise minor and uneconomical investments worthwhile, while also reducing risk
by diversifying the underlying assets.
Basel II Basel II is the second of the Basel Accords, which are recommendations on banking laws and
regulations issued by the Basel Committee on Banking Supervision. The purpose of Basel II is
to create an international standard that banking regulators can use when creating regulations
about how much capital banks need to put aside to guard against the types of ?nancial and
operational risks banks face.
BIS The Bank of International Settlements is the central bankers’ bank. It aims to foster
co-operation between central banks and other agencies to promote monetary and
?nancial stability.
Bonds A bond is a ?xed income debt security, in which the authorized issuer owes the holders a debt
and is obliged to repay the principal and interest (the coupon) at a future date
CFA Chartered Financial Analyst – industry recognised quali?cation for the investment
management sector.
Derivatives A ?nancial instruments whose value is derived from the value of another underlying security.
The most common types of derivatives are futures, forwards, options and swaps.
Hedge Funds Hedge funds are similar to mutual funds in that they both are pooled investment vehicles
which invest on a collective basis. Hedge funds differ signi?cantly from mutual funds,
however, in that they are unregistered and subject to lower levels of regulation which allows
hedge funds to engage in leverage and other sophisticated investment techniques.
MiFID The Markets in Financial Instruments Directive – comes into effect on 1 November 2007, when
it will replace the existing Investment Services Directive (ISD). Amendments to national
legislation and rules to carry out to its provisions must be made by 31 January 2007. MiFID
extends the coverage of the current ISD and introduces new and more extensive requirements
on ?nancial services ?rms.
QFA Quali?ed Financial Advisor – industry recognised quali?cation for those working in retail
?nancial advice in Ireland. The quali?cation is overseen by the QFA Board which is a joint
venture between the Institute of Bankers in Ireland, the Insurance Institute, the LIA and the
Central Bank.
SPV Special Purpose Vehicles are body corporates created to ful?l narrow, speci?c or temporary
objectives, primarily to isolate ?nancial risk. These are commonly used in the securitisation of
loans (or other receivables) to achieve separation from the originating entity.
Solvency II Solvency II is an update to the European standard framework for calculating risk and
allocating capital for insurance companies.
UCITS Undertakings for the Collective Investments of Transferable Securities. UCITs are collective
funds which can be sold across national borders within the EU in accordance with the UCITS
Directive. Under the UCITS III Directive the range of product types in which UCITS funds could
invest was expanded.
International Financial Services International Financial Services International Financial Services 219
Appendix B: Steering
Group Members
Representative Organisation
Ms. Aileen O’Donoghue IBEC, Chairperson
Ms. Jasmina Behan Skills and Labour Market Research Unit, FÁS
Mr. Joe Breslin Enterprise Ireland
Dr. Gary Crawley Science Foundation Ireland
Ms. Bronwyn Gallagher IDA Ireland
Mr. Conor Hand Forfás
Mr. Pat Hayden Department of Enterprise, Trade and Employment
Mr. David Hedigan Enterprise Ireland
Mr. Pat Howlin IDA Ireland
Mr. Barry Jennings Enterprise Ireland
Ms. Deirdre Lyons IDA Ireland
Mr. Gerry Murray Department of Education and Science
Ms. Caitriona Ryan Higher Education Authority
Mr. Martin Shanahan Forfás and Head of EGFSN Secretariat
Mr. George Shaw Department of the Taoiseach
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Appendix C: EGFSN Members
Representative Organisation
Ms. Anne Heraty CEO, CPL Resources PLC, Chairperson
Ms. Ruth Carmody Assistant Secretary, Department of Education and Science
Mr. Gerry Murray Principal Of?cer, Department of Education and Science
Ms. Liz Carroll Training and Development Manager, ISME
Mr. Enda Connolly Divisional Manager, IDA Ireland
Mr. Fergal Costello Head of IoT Designation, Higher Education Authority
Mr. Ned Costello Chief Executive, Irish Universities Association
Mr. Brendan Ellison Principal Of?cer, Department of Finance
Mr. Roger Fox Director of Planning and Research, FÁS
Mr. David Hedigan Manager, Sectoral Enterprise Development Policy, Enterprise Ireland
Mr. Gary Keegan Director, Acumen
Mr. John Martin Director for Employment, Labour and Social Affairs, OECD
Mr. Dermot Mulligan Assistant Secretary, Department of Enterprise, Trade and Employment
Mr. Pat Hayden Principal Of?cer, Department of Enterprise, Trade and Employment
Mr. Frank Mulvihill President, Institute of Guidance Counsellors
Mr. Brendan Murphy Director, Cork Institute of Technology
Mr. Alan Nuzum CEO, Skillnets
Ms. Aileen O’Donoghue Director of Financial Services Ireland, IBEC
Ms. Mary O’Leary School Teacher
Mr. Peter Rigney Industrial Of?cer, ICTU
Ms. Jacinta Stewart Chief Executive, City of Dublin VEC
Mr. Martin Shanahan Head of Human Capital and Labour Market Policy, Forfás and Head of Secretariat
International Financial Services International Financial Services International Financial Services 221
Appendix D: Research and
Secretariat Support
EGFSN Secretariat in Forfás SLMRU of FÁS
Martin Shanahan John McGrath
Kay Hallahan Jasmina Behan
Gerard Walker Ivica Milicevic
Andrew Colgan Joan McNaboe
Aisling Penrose Caroline Shally
Anne Marie Hogan
Nora Condon
International Financial Services 222 International Financial Services International Financial Services
Appendix E: Publications by
the Expert Group on Future
Skills Needs
Report Date published
National Skills Bulletin Oct-07
Monitoring Ireland’s Skills Supply: Trends in Education ? Training Outputs 2006 Jun-07
Tomorrow’s Skills: Towards a National Skills Strategy Mar-07
National Skills Bulletin 2006 Dec-06
Future Skills Requirements of the International Digital Media Industry: Implications for Ireland Jul-06
Careers and Labour Market Information in Ireland Jul-06
Skills at Regional Level in Ireland May-06
SME Management Development Report May-06
Monitoring Ireland’s Skills Supply: Trends in Education?Training Outputs Jan-06
Data Analysis of In-Employment Education Training in Ireland Dec-05
Skills Needs in the Irish Economy: The Role of Migration Oct-05
National Skills Bulletin 2005 Oct-05
The Demand and Supply of Foreign Language Skills in the Enterprise Sector May-05
Skills Requirements of the Digital Content Industry in Ireland Phase I Feb-05
Innovate Market Sell Nov-04
The Supply and Demand for Researchers and Research Personnel Sep-04
Literature Review on Aspects of Training of those at Work in Ireland Jun-04
Financial Skills Monitoring Report Nov-03
Responding to Ireland’s Growing Skills Needs – The Fourth Report of the Expert Group on
Future Skills Needs
Oct-03
The Demand and Supply of Skills in the Biotechnology Sector Sep-03
Skills Monitoring Report – Construction Industry 2003/10 Jul-03
Benchmarking Education and Training for Economic Development in Ireland Jul-03
The Demand and Supply of Engineers and Engineering Technicians Jun-03
The Demand and Supply of Skills in the Food Processing Sector Apr-03
National Survey of Vacancies in the Private Non-Agricultural Sector 2001/2002 Mar-03
National Survey of Vacancies in the Public Sector 2001/2002 Mar-03
The Irish Labour Market: Prospects for 2002 and Beyond Jan-02
Labour Participation Rates of the over 55s in Ireland Dec-01
International Financial Services International Financial Services International Financial Services 223
Report Date published
The Third Report of the Expert Group on Future Skills Needs – Responding to Ireland’s
Growing Skills Needs
Aug-01
Benchmarking Mechanisms and Strategies to Attract Researchers to Ireland Jul-01
Report on E-Business Skills Aug-00
Report on In-Company Training Aug-00
The Second Report of the Expert Group on Future Skills Needs – Responding to Ireland’s
Growing Skills Needs
Mar-00
Business Education and Training Partnership 2nd Forum, Dublin Mar-00
The First Report of the Expert Group on Future Skills Needs – Responding to Ireland’s
Growing Skills Needs
Dec-98
International Financial Services 224 International Financial Services International Financial Services
Appendix F: List of
Submissions Received
Irish Association of Investment Managers
Irish Financial Services Regulatory Authority
Irish Funds Industry Association
Irish Taxation Institute
Letterkenny Institute of Technology
Pioneer Investments
The Society of Actuaries
The Society of Investment Analysts in Ireland
Trinity School of Business
University College Cork
University College Dublin – The Global Finance Academy, Michael Smur?t School of Business
University of Limerick: Kemmy Business School
International Financial Services International Financial Services International Financial Services 225
Appendix G: List of Consultations
with Industry
Company Primary contact Title Location
Sun Life Patrick Bruen MD Ireland Ireland
Sun Life Mary Fay Head of Annuities Business US
Sun Life John Wright VP US Operations US
RBS Rajeev Adrian Director Leveraged Finance UK
Barclays Stephen Gillott (+1) Learning and Development UK
HSBC Rosemary Leahy Head of Funds Ireland
State Street Willie Slattery Country Manager Ireland
State Street Alison Quirke (+1) Global HR Director US
State Street Maribeth Nash VP HR UK US
Depfa Michael Deeny (+4) MD Ireland
Depfa Dr. Donal Gallagher Director, Market Risk Ireland
JP Morgan Carin Bryans VP Treasury and Securities (Ireland) Ireland
JP Morgan Marie Dumas VP Treasury and Securities (US) US
Fidelity Paul Murtagh (+3) MD Ireland
Fidelity David Murphy VP Software Development Ireland
Fidelity Stephen Ashmore Director Development Ireland
Fidelity Cash Mitchell Learning and Development Ireland
Fidelity Jason Hamilton (+2) VP Technology Training Services US
Fidelity Hadley Stern (+2) Director Fidelity Labs US
Merrill Lynch Diane Scheuneman VP Global Infrastructure Solutions US
Merrill Lynch Ann White Head of GMI Learning and
Development
US
Merrill Lynch Tony O’Halloran (+2) Chief Technical Of?cer Ireland
Citigroup Aidan Brady MD Ireland
Bank of America Diarmuid Connaughton (+1) Principal Ireland
Pioneer Rob Richardson (+1) CEO BoA Leasing Ireland
Pioneer Kim Hazen (+1) HR Business Partner US
Pioneer Susana Chiros Employment Manager US
Unicredito Stefano Vaiani MD Ireland
Bank of Ireland Liam Butler (+1) Director Ireland
Bank of Ireland Andrew Blair HR Director Ireland
BNP Paribas Tom Woulfe Group Management Ireland
IAIM Frank O’Dwyer Ireland
DIMA Sarah Goddard CEO BoA Leasing Ireland
Bank of America David Brown CEO BoA Leasing Ireland
Orion Audit Mgt JB McCarthy Ireland
Irish Life Investment
Managers
Deirdre Rigby HR Manager Ireland
International Financial Services 226 International Financial Services International Financial Services
Appendix H: List of Consultations
with Providers
Institute Primary contact Title
School of Business, TCD Brian M Lucey INFINITI Group Coordinator
UCD Prof. Thomas Begley Dean, College of Business and Law
UCD Prof. S Dineen Mathematics
UCD Dr. Anthony Brabazon Director, Natural Computing Research
and Applications Group
UCD Department of Banking and Finance,
Smur?t School
Dr. John Cotter Director, Centre for Financial Markets
Letterkenny Institute of Technology John Andy Bonar Head of Development
UCC Prof. Ciaran Murphy Business Information Systems
UCC Prof. B Hanzon Mathematics
DCU Prof. E Buffet Mathematics
DCU Business School Prof. Liam Gallagher Professor of Finance
NUIM Thomas Flavin Finance Professor, Economics
Department
NUIG Prof. Seamus Collins Head of Department of Accountancy
and Finance
NUIG Bredan Kennelly Economics
NUIG John Hinde Mathematics
NUIG Alan Aherne Economics
UL Kemmy Business School Dr. Bernard Murphy Department of Accounting and Finance
Dept of Accounting and Finance Kemmy
Business School
Mr. Fergal O’Brien Course Director MSc Financial Services
Sligo IT Pat Scanlon Head of Department of Business
Sligo IT Clodagh Caslin
Waterford IT Tom O’Toole Course Director of Business
The Wharton School,
University of Pennsylvania
Richard E. Kihlstrom Chairperson of Finance Department,
Wharton School
Stern School of Business, NYU Richard Levich Deputy Chair Finance
Fordham Jesuit College of New York James Lothian Finance
City University London Prof. Dirk Nitzsche Professor of Finance Cass
Business School
International Financial Services International Financial Services International Financial Services 227
Expert Group on Future Skills Needs Secretariat
c/o Forfás
Wilton Park House
Wilton Place
Dublin 2
Ireland
Tel: + 353 1 607 3000
Fax: + 353 1 607 3030
Email: [email protected]
Website: www.skillsireland.ie

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