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 commercial and investment banking in China, says Jason Tan, a partner at search firm Being & Associates in Shanghai. Foreign financial institutions indulge in it, but it’s more common within domestic banks.
“You only have to look at Chinese banking profiles on LinkedIn to see just how many people have titles like deputy managing director, vice managing director and vice director – you don’t see this in Singapore, Japan or other mature banking markets,” says Tan.
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Job titles are inflated in China primarily with an eye to impressing clients – assigning a junior-ranked banker to front a client meeting is to be avoided. “Title is 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.
“A head of department in a Chinese conglomerate would only be interested in meeting a VP or above banker, even from a foreign bank. So the bigger your title, the bigger your face value, which also equates to your authority,” adds Tan.
Unsurprisingly, you are most likely to snare an inflated title in a client-facing job such as a relationship manager in corporate banking, private banking or priority retail banking, says Tan. “As for investment banking, this trend is often seen in sales and trading, equity analysis and M&A.”
Tan says it’s not uncommon for private bankers in their late 20s to have the title director. “I’ve also recently seen a 29-year-old equity analyst holding an MD title in a Chinese investment bank. And have you ever seen a 28-year-old MD with at a global bank in New York, London, or Hong Kong? It happens in China.”
Inflated job titles are also symptomatic of the talent-short, but growing, Chinese job market, where competition for candidates is strong. They are, for example, being used – in both the mainland and Hong Kong – as a carrot for Chinese banks to poach staff from Western rivals.
“Chinese banks are trying to build their capital-markets business, some are even hiring overseas, in hubs like London. In order to attract talent, they pay up or offer a sexy title,” says Moncef Heddad, CEO of MH Search and Advisory in Hong Kong. “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.”
There’s a longer-term career downside, too. “Candidates 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, in fact, require you to take an apparent step down the career ladder. Tan from Being & Associates 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.”