You may spend your entire working life never coming across a ‘search’ firm. That is because search recruitment is quite the niche sector: it is usually reserved for high demand and high salary roles, which require a very specific skillset.
So what is search recruitment, exactly? This type of headhunting can be distinguished from ‘retail’ or ‘high street’ recruitment by a few factors.
Search usually doesn’t rely on high volumes of applicants or even job advertisements. A search recruiter, otherwise known as a ‘headhunter’, will actively seek out candidates, most of whom are ‘inactive’ in the market – meaning they already have a job and aren’t actively looking for a new one. This means it’s usually a tougher sell for the recruiter to the candidate to take on a new role in a new organisation. This is one of the reasons search firms pick their clients carefully: they don’t want to work for just any company, and neither do the candidates.
The Search Recruitment Process: An Overview
Once the headhunter has found and contacted enough suitable candidates that have expressed an interest in the role, they will create a shortlist for their client. The latter will then select the candidates who, in their opinion, will be the best fit for the role. The selected candidates will be asked for an interview or testing, depending on the client’s needs and internal processes. The search recruiter’s role will be to act as an intermediary, and will often assist with salary negotiations.
Once the search process is completed, the recruitment firm will usually charge their client a percentage-based fee on the role’s first year’s salary. While this may seem like a considerable amount for some, search recruitment comes with a vast array of advantages for the client. Other than the obvious reason of not finding the best talent – which comes with a colossal cost – there are a few organisational reasons for hiring a search firm.
Preventing ‘Nepotistic Contagion’
A problem often seen in organisations is ‘mates hiring mates’. If you ignore the societal consequences of this, it seems fine on the face of it. Why not work with someone you already like? What can possibly go wrong? While this approach may seem like a simple choice, it can go wrong very quickly.
The inter-related nature of combining outside relationships with business makes for a complex soup of HR problems. Work can already be highly political, but if you combine that with external issues, it becomes a nightmare of interrelated conflict; you now have ‘nepotistic contagion’ in your office.
Hiring a search recruiter means that the candidates being presented are not mates, or mates of mates and, if the recruiter is doing a good job, the candidates will be from diverse backgrounds.
It’s very important for companies, especially in professional services, that they keep diversity in their ranks to avoid ‘groupthink’. As mentioned in one of our articles about gender diversity in compliance and financial crime – which found that in 2020, men occupied 86% of SMF16 & SMF17 roles in the UK – there is still a long way to go before financial services firms truly embody diversity.
Rutherford is a boutique search firm that specialises in legal, financial crime and compliance recruitment within the financial services and legal sector, with London and New York being the main focus. We use our carefully curated relationships, networks and market knowledge to find the best fit for the clients in hand. We work with a wide range of clients, spanning from advisors, corporate and commercial banks, brokers, exchanges, MTFs and financial tech, through to global investment managers, hedge funds, private equity firms and investment banks.