Emotional Intelligence in Finance: Recruiting for EQ as Well as IQ
“Emotional intelligence does not merely separate leaders from the crowd; it is the sine qua non of leadership,” once remarked Daniel Goleman, who popularized the concept of Emotional Intelligence (EQ). But what role does EQ play in the finance sector, particularly in executive recruitment? Can it be the linchpin in the complex mechanism of financial leadership?
A study by the Carnegie Institute of Technology found that 85% of financial success is due to skills in “human engineering,” personality, and ability to communicate, negotiate, and lead—remarkably, all elements of EQ (Psychology Today). These findings are a clarion call for the recruitment industry, especially in finance, to pivot its focus not only on IQ but also on EQ.
The Emergence of EQ in Finance Leadership
The finance sector has traditionally valued IQ for its ability to enable professionals to understand complex financial models and market dynamics. However, as the business environment becomes more volatile and uncertain, the need for leaders who can manage stress, inspire teams, and navigate through change becomes critical. Emotional intelligence, which encompasses the ability to recognize, understand, manage, and utilize emotions effectively, is increasingly recognized as a key predictor of success in financial leadership (Forbes).
Recruiting for EQ in Finance
When recruiting for finance roles, assessing a candidate’s EQ can be as crucial as evaluating their technical skills and experience. Recruiters must look for traits such as empathy, self-awareness, and adaptability. These soft skills enable finance professionals to foster strong relationships with clients, colleagues, and stakeholders, leading to better business outcomes.
Emotional intelligence also plays a vital role in self-development. Recruiters, who sift through numerous CVs daily, need to provide an objective assessment to candidates. An understanding of EQ helps recruiters identify candidates who are not only technically proficient but also capable of personal growth and team leadership (Forbes Human Resources Council).
The Balance Between EQ and IQ
While IQ focuses on cognitive abilities, EQ involves a set of skills that affect how we navigate social complexities and make personal decisions that achieve positive results. Both forms of intelligence are crucial in the finance sector. A high IQ enables a professional to understand technical aspects, while a high EQ can lead to better teamwork, client management, and leadership. It’s this combination that often results in a well-rounded and successful finance executive.
Implementing EQ Assessment in Recruitment
Implementing EQ assessments in the recruitment process can be challenging but not insurmountable. Recruiters can use psychometric tests, behavioral interview questions, and situational judgment tests to evaluate a candidate’s emotional intelligence. Moreover, references and past performance reviews can also provide insights into a candidate’s EQ.
Conclusion
In conclusion, emotional intelligence is not a peripheral skill—it is a core competency for financial leaders. The ability to recognize and manage one’s emotions and understand the emotions of others can significantly affect decision-making, leadership, and ultimately, financial success. As the finance industry continues to evolve, the recruitment process must adapt accordingly, giving equal weight to both EQ and IQ. By doing so, the industry will not only enhance its human capital but also ensure sustainable success in an ever-changing financial landscape.
About
Warner Scott , based in London and Dubai, is a global leader in executive recruitment for Banking & Investments, Accounting & Finance, and Digital & Fintech. With over 18 years of experience, they have built solid relationships with top-tier banks, financial institutions, and accountancies. Their distinct advantage comes from these long-term relationships with hiring managers and internal recruiters, a broad candidate network, and continuous candidate engagement. This unique positioning earns them trust from both talent and hiring managers. Their in-depth understanding of recruitment needs enables them to identify senior C-suite, EVP, SVP, and MD-level hidden, ready-to-move talent that other recruiters cannot reach.
Providing customized recruitment solutions, Warner Scott serves both international and regional clients as true business partners. Their offerings encompass retained, exclusive, and contingency searches, along with permanent, contract, and interim staffing services.
In Banking and Investments, they engage with international and regional banks and investment houses in London and the Middle East, including conventional and Islamic banks. They cover areas such as Private Equity, Asset Management, Investment Banking, Treasury & Global Markets, Wholesale Banking, Digital & Technology, Risk Management & Compliance, and C-Suite Appointments.
In Accounting and Finance, Warner Scott partners with The Big 4 and Top 50 accounting firms, along with globally recognized consultancies. They specialize in Audit, Risk & Compliance, Tax (Private Client, Expatriate, and Corporate Tax), Corporate Finance, Transaction Advisory, Restructuring, Turnaround, Insolvency, Forensic Accounting, Disputes & Investigations, Forensic Technology, eDiscovery, Cyber Security, and Management Consultancy.
In Digital & Fintech, they assist large banks, digital startups, and innovative Fintechs in areas such as FinTech (AI, Blockchain, Cloud Computing, Big Data), InfoSec/Cybersecurity (Application, Infrastructure, Network, Cloud, IoT securities), Digital Leadership, Digital Transformation, Software Development, IT Project/Program management, Data Science & Analytics, Data Privacy, and Data Architecture.
References
– “Why Financial Intelligence Is So Emotional.” Psychology Today, https://www.psychologytoday.com/us/blog/the-human-side-finance/201801/why-financial-intelligence-is-so-emotional.
– “Why Financial Emotional Intelligence Is the Predictor of Ultimate Success.” Forbes, https://www.forbes.com/sites/forbescoachescouncil/2019/12/27/why-financial-emotional-intelligence-is-the-predictor-of-ultimate-success/.
– “IQ vs. EQ.” Simply Psychology, https://www.simplypsychology.org/iq-vs-eq.html.
– “Why Does Emotional Intelligence Matter in Recruiting?” Forbes Human Resources Council, https://www.forbes.com/sites/forbeshumanresourcescouncil/2021/10/18/why-does-emotional-intelligence-matter-in-recruiting/.