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Striking out in a career within Investment Management: Front, Middle and Back Office explained!

Striking out in a career within Investment Management: Front, Middle and Back Office explained!

 

Accounting for wholly 35,000 jobs in the Irish market (16,000 of which are within funds), the Global Investment space is clearly thriving in Ireland. Brexit is now on the horizon, though in exactly what form is still unclear, and Ireland will soon be the only nation boasting English as their first language within the EU. This strategically placing it for further employment growth within the Investment space from English speaking nations outside the EU trade borders. UK domiciled companies are finding themselves in the unusual situation of moving further from the mainland of Europe (to Ireland) in order to position themselves closer to the free market.

The potential to build a successful career in Investment Banking is clearly significant but if you are investigating what that might look like understanding the types of roles and where they sit within the organisation could be a good first step. The phrases Front, Middle and back office are commonly used to describe where roles sit within a company and we’ll take a look below in a little more detail what they look like.

 

On the front line: life in the front office

Essentially made up of the different teams that generate revenue or profit for both the institution and the client. Mergers and Acquisitions, though they don’t directly bring revenue into the company are also considered front office as they operate closely with clients. Front Office are sought after roles and consequently can be competitive requiring strong academics and conscientious work ethic to succeed.

Made up of roles such as Asset Managers, Sales and Traders these positions are client facing and require quick and intelligent decision making and sometimes long working weeks. Top performers are handsomely rewarded financially and benefit from working directly with leading players in the Global Investment market.

 

The growing middle: assurance and support

The middle office are those roles that act in support of, and often monitoring/oversight of front office positions. These roles include Risk Management, Payments and IT. In particular they generally require a well-educated and cost-effective workforce which helps explain why such roles have thrived in Ireland.

The middle office function bares significant responsibility in protecting the business in areas such as legal compliance, financial risk and IT process robustness. For instance, the risk department within the middle office should challenge the front office sales team where they feel investment decisions expose the business to unreasonable risk and as such play an important role within the second line of defence.

 

The engine room: a career in back office

Back Office in very broad terms can be referred too as the operational side of the business. Handling all the post trade transactions made by the front office team. These roles include areas such as Fund Accounting but also the broader operational team such as HR and some IT functions.

There has also been significant Foreign Direct Investment in growing back office functions within Ireland. While it is the view of some that Front Office/Middle Office roles are closer to “the money” or “the client” the back-office functions are a critical part of the team and present significant opportunities for career growth. Roles in Fund Accounting and can sometimes be accessed without the third level degree that is often demanded for front office positions.

Broadly speaking front, middle and back office describes the proximity of a role to the investor. That said in a complex industry these terms are also generalisation and can vary between role and organisation. Due to the common use of these terms within industry understanding them is a good first step when investigating a career within Investment Management.

 

For more information on these types of roles and to explore opportunities within the Investment Management space contact Michael Gorman on (01) 6994524 or email michael@engagepeople.ie