Want to work in a market where you stand a good chance of having “director” in your job title before you hit 30?
So-called title inflation – bestowing senior designations on junior staff – is “rampant” in banking in China, says Jason Tan, a partner at search firm Carlson Harriet in Shanghai.
“You only have to look at Chinese banking profiles to see just how many people, some under 30, have titles like deputy managing director, vice managing director and vice director. You don’t see this in Singapore or other mature banking markets,” says Tan.
Job titles are inflated in China primarily with an eye to impressing clients.
“Titles are very important in China, especially when dealing with the senior management of a client – for example, arranging meetings or even getting through to the right person on the phone,” says Alistair Ramsbottom, managing director of Shanghai search firm The Blacklock Group.
“Title inflation is still common as Chinese are strong believers in ‘face’ – social prestige and reputation – which can bring them more attention and potential business,” says Stephen He, a partner at recruiters Falcon Talent in Shanghai.
“The bigger your title, the bigger your ‘face’ value, which also equates to your authority,” adds Tan. “A head of department in a Chinese conglomerate would only be interested in meeting a VP or above banker, even from a foreign bank,” adds Tan.
This year some global banks in China have become more “relaxed” in granting senior titles to fend off competition for talent from technology companies, buy-side firms and online lenders, says Tan.
“For example, J.P. Morgan created an executive director rank for senior VPs. And Standard Chartered in China recently started assigning ED titles to mid-level managers across the front, mid and back office. It’s a tool to retain staff and localise the job rankings.”
Unsurprisingly, you’re most likely to snare an inflated title in a client-facing job such as a relationship manager in corporate or private banking, says Tan. “As for investment banking, the trend is often seen in sales and trading, equity analysis and M&A.”
Chinese banks are doing it too
Inflated job titles are also symptomatic of the talent-short mainland labour market, where competition for candidates is strong.
They are, for example, being used as a carrot for Chinese banks to poach staff from Western rivals. “I’ve recently seen a 29-year-old equity analyst holding an MD title in a Chinese investment bank,” says Tam.
“Chinese banks are trying to build their capital-markets business, and to attract talent they’re paying up or offering a sexy title,” says Moncef Heddad, a former investment banker at J.P. Morgan in Hong Kong who now runs boutique advisory firm MH Partners. “Unfortunately, many young bankers jump ship for the title and find themselves with a fancy title but a smaller platform and a limited product offering,” he adds.
There’s a longer-term career downside, too. “Bankers don’t realise that having a senior title actually carries a lot of risk, especially in the current fluctuating markets,” explains Heddad. “Once you are perceived to be senior at a Chinese bank, it will be hard to get back into a global bank at that level because everyone will know you took a short cut. Senior jobs don’t open up frequently these days at the globals, some have a hiring freeze for MDs.”
Returning to an international bank could even require you to take an apparent step down the career ladder. Tan from Carlson Harriet explains: “I recently placed a risk professional from a Chinese bank who had an inflated MD title. He was hired by a foreign investment bank, but it said vice president on his offer letter.”
Not all firms are prematurely promoting people, however. “Deutsche Bank remains strict in giving titles in China. You can have 20 years’ experience there and you might remain a director,” says Tan.
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