Most growing Financial Services businesses have hired a senior Risk or Compliance leader who looked ideal on paper and struggled in practice.
The CV was strong. The problem was the environment.
For the individual, a move from a more established business into a challenger can look like a natural progression: more responsibility; greater visibility; a broader remit; more influence over how the business develops. For many, it is exactly that.
But the same autonomy that attracts people to growing businesses can also be what makes the move difficult.
The question isn’t simply: “Can you do the job?”
It’s: “Can you do the job in this environment?”
Getting the answer wrong is costly on both sides. A senior appointment may need FCA approval as a Senior Manager, which can take months. Board and investor confidence is at stake, as is the regulator’s view of the function. And for the individual, a move that doesn’t work can set a career back.
At PSD, we regularly advise leadership teams on hiring senior Risk & Compliance leaders. Increasingly, the conversation goes beyond technical expertise and regulatory knowledge. They want people who can operate at pace, make decisions with imperfect information, understand the commercial implications of risk and own the outcome.
What Does That Look Like in Practice?
Commercial Judgement
The strongest Risk & Compliance leaders understand that their role isn’t simply to identify what the business can’t do.
They understand what the business is trying to achieve and help it get there responsibly.
That doesn’t mean saying “yes” to everything. It means explaining the risk, understanding the commercial consequence and proposing a way forward. “No” without an alternative is rarely enough.
Ownership
Autonomy is one of the biggest attractions of a growth business. It is also one of its biggest tests.
In a smaller organisation, there are fewer layers and committees to absorb difficult decisions. Senior leaders are expected to weigh up the information available and make a recommendation:
“I’ve considered the information, understood the risks and commercial implications, and this is what I recommend.”
That’s very different from simply presenting the problem.
Pace and Ambiguity
Growing businesses rarely have the infrastructure of a large bank. Frameworks are still being developed. Data may be imperfect. Priorities change.
The people who thrive are comfortable making a sensible decision with 80% of the information rather than waiting indefinitely for 100%.
Pace doesn’t mean recklessness. It means knowing what needs to happen now, what can wait and where further analysis adds value.
In many growing businesses, change isn’t a programme with a start and an end. Change is the business.
Strategic, but prepared to roll up their sleeves
Increased seniority in a FinTech or challenger organisation rarely means stepping away from the detail. Often, it’s the opposite.
A senior Risk or Compliance leader may present to the Board in the morning and review a policy or challenge a control that afternoon. They need to be as comfortable shaping strategy as they are delivering it.
Comfortable under scrutiny
Senior leaders in growing businesses often engage directly with CEOs, NEDs, investors and regulators far earlier than they would in a large institution. It can be demanding, but also one of the most rewarding aspects of the role.
As one CEO of a Consumer Finance business recently told us:
“We’re not looking for someone to maintain the status quo. We need risk leaders who can drive change at pace and thrive in a demanding environment, with real Board and investor scrutiny.”
That mindset is particularly visible in areas such as AI and automation. The question isn’t whether they have already implemented the latest technology. It’s whether they have looked for ways to improve how their function operates, made the case for change and tried to move things forward.
Why Risk & Compliance Leaders Struggle When Moving from Large Banks to Challenger Firms?
Experience in a major bank is valuable. But experience at scale doesn’t automatically translate to experience without scale.
Some people thrive when they move into a smaller organisation. Others discover the infrastructure they relied upon was what enabled them to be effective: specialist teams, established process, larger budgets, sophisticated MI and a tolerance for lengthy decision-making.
Another challenge is bringing established frameworks into a business where they aren’t proportionate. A control that makes perfect sense for a large institution may be unnecessary, or counterproductive, in a 150-person lender. Proportionality is a skill.
None of this makes larger firm experience an insurmountable risk. It means the transition requires careful management and clarity around infrastructure, budget and scope throughout the hiring process.
How Challenger Banks and FinTechs Can Successfully Hire Risk & Compliance Leaders
Fit isn’t only about whether a candidate is right for the business. It’s also about whether the business is set up for that person to succeed.
In our experience, the hires that work best have a few things in common:
An honest brief. If the role is broader than the title suggests, say so. If the business is demanding, explain what that means. If the function needs building from scratch, don’t disguise it as a “strategic leadership opportunity”.
Clarity on autonomy and access. How close the role sits to the CEO and Board, which decisions it owns and what happens when it challenges the business.
A realistic view of what’s in place. The current team, infrastructure, MI and budget, and planned investment.
A genuine appetite for change. If the business wants someone to drive change, it needs to be ready to back them when they do.
The strongest candidates will test all of this during the process. Businesses that answer clearly and transparently are far more likely to attract and retain them.
Ultimately, success in challenger banks and FinTechs isn’t defined by the biggest names on a CV. They combine technical credibility with commercial judgement, adaptability, energy for change and a willingness to own the outcome.
Where the pace is high, infrastructure is evolving and Board scrutiny is high, those qualities make the difference.
If you are looking to strengthen your Risk & Compliance leadership, whether that’s a CRO, Head of Compliance, MLRO or Risk Director, PSD Group would welcome a conversation around current market trends and securing the right cultural fit for your business.
