C APTADORES

Candidates nominated for promotion to MD have high levels of human capital.

Their knowledge, skills and experience as bankers, or in their functional roles, are generally not questioned at this stage as it is assumed that they would not have reached and retained their position as Director if they were not technically competent at their job. As one specialist put it: “Anybody who has made it to D3 [Director third year] is not an idiot, they are technically able to do the job or they would have been fired years ago”. Candidates are aware of this, as one said:

“it’s not about being the technical/specialist expert, that is a given, that’s the day job”. Technical competence is a threshold requirement for nomination to the position of MD. Generally, what was required beyond this was described by one candidate as:

“Various things like being seen to be a good colleague to others across the firm and not just in your immediate area, contributing to the broader effort rather than just being purely focused on your own piece of work, being seen as a role model and someone who does the right thing and is maybe fairly public about that – those kind of things – the softer stuff”

(Sally, appointed).

Sally refers to the criteria for promotion beyond technical expertise as the

“softer stuff” referring to criteria that are qualitative rather than quantitative and that may be assessed in a more subjective way. In terms of qualitative criteria several candidates made reference to a document that had been drawn up by a global leader listing the leadership competencies¹⁸ that all MDs were expected to demonstrate in their daily business (this is the same list of criteria used by the specialists and sponsors in their due diligence exercise). However, not all candidates appeared to have seen this document, not everyone was certain of its provenance and some even thought that is was a confidential document to which they should not have access:

“There is a guideline that’s accessible to all saying what are the attributes that an MD should be showing” (Thomas, appointed).

“I remember I had a copy of it [the list of MD competencies] and I don’t know whether I should have or shouldn’t have had” (Stuart, not appointed).

In the following quote, Elena takes a different view on the criteria for promotion, citing a political dimension around ‘who’s been promised what’ and a personal dimension around the importance of being liked:

“I always find promotion processes, whether they are from director to MD or from VP to director or from associate to VP, very subjective. If people like you, like I said before, if they feel that they might lose you if they don’t give it to you, you end up getting it. If people don’t like you, even if

18 A copy is available in Appendix A

you’re doing a very good job, they would rather pay you than give you the promotion so I find it, in the end, always quite subjective” (Elena, not appointed).

Elena’s perception of the criteria for promotion is based less on objective criteria and more on subjective and situational assessment of candidates. Equally candidates could not be completely clear about the quantitative criteria. Much of this related to the revenue that they were able to bring in to the firm and the size of the deals that they had been involved with. However, no candidates were able to provide guideline figures for this, with many stating that it depended on industry, product, geography, market economy etc.

“The desks are very different, and somebody who makes $30m in a year, he may be doing a very poor job versus somebody who’s made $15m. If the guy who’s made £30m should have made $60m given the potential market share and the guy who’s made $15m should only have been making $5m. So that’s a very hard decision” (Adam, appointed +1).

This apparent subjective assessment of ‘objective’/quantitative data caused many of the candidates, both appointed and non-appointed, to question how decisions about which candidates to promote were made when comparisons crossed several different departments:

What I understand is a bit more problematic is how does one guy in one region compare to another guy in another region and how do you mesh the rankings” (Bradley, appointed).

“The thing I don’t understand, and speaking to other people around me at my level is less well understood, is how people compare merit across actually what are quite different roles and quite different jobs” (Olivia, not appointed).

Specialists, too, argued that it was difficult to make comparisons across candidates both on quantitative criteria (because revenue generation is ‘highly episodic’) and qualitative criteria, although specialist 2 felt that this gave an opportunity to ask ‘more granular questions’. He also felt it was important not to

base all the information collected on the last year but over a longer period of time, highlighting the need to move away from the short term nature of decision-making in this sector.

4.4 Outcomes from the process

Candidates recognise that although criteria for promotion exist, both quantitative and qualitative, it is difficult to make comparisons across candidates and that outcomes are unlikely to be based on objective decision-making. This makes it increasingly difficult for candidates to understand how decisions are made about who gets through each stage of the process and who is ultimately promoted.