How finance leaders can tackle recruitment and retention challenges

Being a finance leader in 2024 is no easy feat. From cutting costs to managing cash flow and improving forecasting, the demands are ever-present.

Among these challenges, one consistently stands out: attracting and retaining top finance talent.

A shortage of skilled professionals has troubled finance leaders for years, but the situation is more acute than ever.  According to research, 90% of CFOs plan to spend more time focusing on talent acquisition and retention in 2024 than in previous years, citing this as a critical challenge due to the ongoing shortage of qualified finance professionals​.

As demands on finance teams evolve, so do the challenges of talent acquisition and retention, driven by salary inflation, flexible working demands, and technological change.

Salaries for finance professionals have surged in the last decade. In the Yorkshire SME market, for example, financial controllers can now command up to £75,000, compared to £50,000 ten years ago – a substantial 50% increase. While this reflects competition for top candidates, it creates financial pressure for businesses, especially finance leaders who are already tasked with controlling costs.

My team of recruiters regularly hear from finance professionals that flexibility is key, with three in four requesting hybrid work arrangements. However, industries like manufacturing often resist this shift, insisting on full-time office attendance. This reluctance is pushing talent away as professionals increasingly prioritise work-life balance​.

Advances in AI and data analytics, particularly tools like PowerBI, have revolutionised the finance sector. However, many finance leaders struggle to keep pace with these technological advancements and, as a result, find it difficult to identify and assess the evolving tech skills that are critical for new hires.

Given these challenges, finance leaders need to adopt effective strategies to attract and retain talent. At Headstar, we’ve seen several approaches that work.

1. Best offer first

In today’s competitive market, candidates know their worth. Companies need to offer their best salary upfront rather than trying to save costs by low-balling candidates. Top candidates often receive multiple offers, so a compelling initial offer is critical – otherwise, you risk missing out.

2. Embrace flexibility

Flexibility is no longer a perk – it’s essential. Companies that offer hybrid working models are far more attractive to finance professionals. Flexibility also improves retention, as employees value a healthy work-life balance.

3. Focus on mentoring and career progression

Clear paths to progression are vital for retaining finance professionals. Mentoring programs are appealing as they provide guidance and a clear route to leadership. Leaders who mentor their teams foster stronger, more engaged staff, improving retention.

4. Don’t rush the hiring process

Kneejerk decisions can be costly, so take your time – but, conversely, avoid going too slowly as you risk missing out on quality candidates.

5. Use expert recruiters

Partnering with expert specialist recruiters like Headstar gives you a huge advantage over businesses that go it alone or rely on generalist recruiters who serve every market. We know the market and candidate expectations and can provide you with expert counsel to secure the best person and deliver an excellent candidate experience.

6. Upskill your existing team

Rather than constantly seeking external hires, investing in the current team is sometimes more effective. For example, training employees in AI and leadership skills not only strengthens the finance function but also improves retention by enhancing loyalty and employee development.

7. Measure your success

The only metric that really matters is the percentage of successful hires against the total number of hires. It’s so simple, but often forgotten.

The competition for finance talent is intense. Finance leaders who embrace these strategies and adapt, innovate, and invest in their people will emerge as the winners. The future of your business depends on it.