October 12, 2015 12:49 ET

Attract & Retain Talent in the Finance Industry

Interview with Mike Wagner, Vice President, Compensation Manager at Fifth Third Bank

NEW YORK, NY--(Marketwired - October 12, 2015) - The changes in the regulatory environment and the improving economy in the US are having a significant effect on compensation and benefits strategies. Financial institutions need to be able to develop effective strategies in order to gain a competitive advantage and attract, retain and motivate talent whilst managing costs.

Mike Wagner, Vice President, Compensation Manager at Fifth Third Bank recently outlined key topics to be discussed at the second edition of the GFMI 2nd Annual Compensation and Benefits in Financial Institutions Conference, November 5-6, 2015 in New York, NY.

How do the increased regulatory requirements directly impact HR? How will compensation and benefits be affected by the CEO pay ratio rule and the Proposed Overtime rule?

MW: For benefits, under the Affordable Care Act, we are considering what action to take on domestic partnerships. We can either eliminate eligibility for domestic partners (because same-sex couples can get married now), or keep them and allow domestic partnership benefits for opposite-sex couples.

In compensation, we are directly impacted by the Dodd-Frank regulations, which require us to report to the Fed on how we incentivize roles that impact risk, and the Volcker Rule, which limits the types of products we can incentivize in certain roles. We are still waiting to understand the impact of the proposed overtime rule. However, to prepare for this, we have a committee in place whose role is to anticipate, prepare for and address important regulatory changes impacting Human Capital. This group is doing some preliminary analyses of possible cost impacts of overtime changes.

The impact of the CEO pay ratio rule is yet to be seen, as well. So far, our main area of focus has been on our communication strategy on the findings.

What strategies does your company use to attract and maintain talent?

MW: To attract talent, we don't lead with rewards. Instead, we expect the hiring leader to get candidates excited about our culture, leadership and career development opportunities and community impact. Our employment brand at Fifth Third revolves around the opportunity we give candidates to build their future, win together and impact lives.

Specific talent search tools we use include LinkedIn Recruiter and Zoom info. We also conduct what we call "drip" campaigns, where we identify the talent we want and establish long-term relationships. We stay in touch with the talent, invite them out for dinner and keep our eyes open for the appropriate opportunity. It can take time, but we believe time spent to attract the right talent is always time well spent.

To maintain talent, we keep active career discussions going with high-potentials. We carefully monitor the market competitiveness of compensation, and occasionally provide retention awards.

How do you go about effectively communicating benefits packages to employees?

MW: We coordinate benefits communications with partners in Total Rewards, Corporate Communications, and HR business partners. We use a variety of approaches, such as a quarterly newsletter (sent via both email and U.S. mail), postcards, employee meetings and Jellyvision (a fun, Web-based tool).

We take an accessible approach to benefits communications -- they should easy to read, compelling and visually appealing.

Why is it difficult to establish the right pay mix for total compensation?

MW: It can be a challenge to balance pay mix because it requires comp to balance the desired human capital philosophy against market practice. For example, a company may decide to tilt the pay mix more heavily toward long-term incentive, to better drive retention. However, the company may have difficulties recruiting candidates who have other offers that are stronger in cash.

The other key challenge is in putting the appropriate amount of pay at risk. Most people will want the sure thing (base salary) instead of having pay tilted toward incentive. However, pay needs to be driven by incentive for sales roles.

Regarding market pricing, how much do you trust survey data?

MW: We trust survey data, but do not typically make changes to the comp structure based on one year's data. We look for consistency in year-over-year trends before tweaking incentive targets. Another key question is whether our company has the same number of levels as the market data. If we have to blend levels, that gets us away from science and more into art.

We also ask how close our internal job is to the market match. Recently, we were trying to get market data for a sales role. However, the product was brand new - so by definition, there were no true comparators in the market. We used the sales generalist match instead. They key is that our internal partners (the business leader, finance partners, HR Business partners) understand this type of context behind the match.

What can we expect from regulators in the coming years?

MW: For benefits, we expect more regulation on wellness programs, such as any insurance cost surcharge -- or bonus -- that the company would apply for wellness outcomes.

In compensation, we expect that the Fed will expand Dodd-Frank reporting requirements to new roles. For example, we have, up until now, been required to conduct risk mitigant back-testing on Commercial relationship manager roles. We think it is likely that the Fed will require us to do this for more roles soon.

Mike Wagner is the Compensation Manager for the Commercial Bank, Payments, Risk and Credit organizations at Fifth Third Bank. Mike oversees the incentive design process for all Commercial Banking plans, and has been actively involved in Fifth Third's response to the Federal Reserve on Dodd-Frank compensation regulations. At Fifth Third, Mike has also been heavily involved in enhancing current processes such as job evaluation, candidate offers, and career pathing.

Before Fifth Third, Mike was Director, Human Capital Research at AXA Equitable, where he led the annual employee engagement survey process. He has also been a Compensation Manager at American Express, and has worked in the Human Capital Strategy group at Mercer HR Consulting. Mike has conducted numerous independent survey research projects in organizations such as the United Nations, Columbia University, and Morgan Stanley.

Mike earned his Bachelor's degree in English from Northwestern University and his PhD in Organizational Psychology from Columbia University. He has published and presented compensation research in the International Journal of Psychology and at Academy of Management conferences.

The GFMI 2nd Annual Compensation and Benefits in Financial Institutions Conference provides financial institutions with an opportunity to find new ways to create innovative and competitive compensation and benefits packages that reflect the changing shape of the workforce. Financial institutions will also learn how to effectively comply with the Affordable Care Act, establish best practice in executive compensation and overcome the challenges that accompany international compensation and benefits.

For more information, please click here to download the conference agenda or contact Tyler Kelch, Digital Marketing Manager, GFMI at 312-894-6310 or

About Global Financial Markets Intelligence

GFMI is a specialized provider of content-led conferences for the financial markets. Carefully researched with leading financial market experts, our focused quality events deliver key bottom-line value through targeted presentations, interactive discussions and high-level networking opportunities.

Image Available:

Contact Information