Hiring your first finance professional in Germany
Hiring your first finance professional is a crucial step for any business, especially in a highly regulated and competitive market like Germany.
Whether you’re a startup looking to scale or an established company expanding its operations, the role of a finance professional can significantly influence your business’s success.
Here are some key considerations, challenges and best practices when hiring your first finance professional in Germany.
Understanding the importance of a finance professional
A finance professional plays a pivotal role in managing your company’s financial health, ensuring compliance with local laws and providing strategic insights for growth. Financial regulations are stringent in Germany, so having an experienced finance expert is not just beneficial but often essential.
Small and medium-sized enterprises (SMEs) – or Mittelstands – in Germany are particularly dependent on skilled finance professionals to navigate the complexities of local tax laws and financial regulations.
The Federal Ministry for Economic Affairs and Climate Action reports that reports that 99.6% of businesses in Germany are Mittelstands, which underscores the critical need for competent financial management.
Choosing the right time to hire
Knowing when to hire your first finance professional is as important as the hiring process itself. Many businesses delay this decision, assuming they can manage with basic accounting software or part-time help. But as your business grows, so does the complexity of your financial operations.
Businesses experiencing rapid growth or entering new markets often face financial challenges that require professional oversight. These challenges include managing cash flow, ensuring compliance with tax regulations and securing funding. Hiring a finance professional during these pivotal moments can prevent costly mistakes and support sustainable growth.
Key skills and qualifications to look for
When hiring a finance professional in Germany, it’s essential to identify the key skills and qualifications that align with your business needs. The German finance sector is known for its high standards, and professionals in this field often possess a robust educational background and relevant certifications.
Many finance professionals in Germany hold advanced degrees in finance, economics or accounting, and are often certified by recognised bodies such as the Institut der Wirtschaftsprüfer (IDW) or the Chartered Institute of Management Accountants (CIMA).
It’s also critical to have proficiency in German tax law (Steuerrecht), financial reporting (Rechnungslegung) and familiarity with the German Generally Accepted Accounting Principles (HGB).
Soft skills such as analytical thinking, attention to detail and effective communication are equally important. It’s becoming increasingly valuable for finance professionals to translate complex financial data into actionable business strategies, demonstrating the importance of both technical and interpersonal skills.
The recruitment process: challenges and best practices
Recruiting a finance professional in Germany involves several steps with their own set of challenges. The process typically includes defining the role, sourcing candidates, screening CVs, conducting interviews and finalising the hire. But the competitive nature of the German job market can make this process daunting, especially for businesses that are new to the market.
1. Defining the role
First, clearly define the responsibilities and expectations of the role.
Whether you’re looking for a Chief Financial Officer (CFO), a Financial Controller or an Accountant, the job description should be specific and aligned with your business goals. Clearly defined roles attract more qualified candidates and reduce the risk of turnover.
Working with a specialist, boutique recruitment agency like Brewer Morris can help you tailor your job description depending on your requirements. You can engage with us at the start of your search and we’ll take the time to listen to your needs when finding the right candidates.
2. Sourcing candidates
Sourcing the right candidates can be challenging due to the high demand for skilled finance professionals in Germany. Online job portals such as StepStone and XING are popular platforms for finance job postings.
Working with a specialist agency can help you tap into a broader talent pool. Recruitment consultants have access to passive candidates – those not actively looking for a job but are open to change. According to LinkedIn, 70% of the world’s candidates are passive but an incredible 94% of them would consider moving for the right opportunity.
We’ll make sure we fully understand exactly what you’re looking for and approach those candidates for you – providing shortlists of potential talent with a quick turnaround.
3. Screening and interviewing
Screening CVs and conducting interviews require a keen understanding of the finance profession.
It’s worth considering that the direct-hiring route can inundate you with CVs – many of which aren’t relevant for the role. Recruitment agencies reduce this burden by undertaking these time-consuming tasks, then refining a list of the best candidates for the role so you can interview them.
Consider using a combination of technical assessments and behavioural interviews to evaluate both the hard and soft skills of candidates. Businesses that integrate structured interviews into their hiring process are much more likely to hire the right candidate.
4. Compliance with German labour laws
Germany has strict labour laws, particularly regarding employment contracts and employee rights.
We can help ensure that your hiring process complies with regulations such as the German Employment Protection Act (Kündigungsschutzgesetz) and the Minimum Wage Act (Mindestlohngesetz) – which is crucial to avoid legal disputes and financial penalties.
Salary expectations and market trends
Understanding salary expectations and market trends is essential when hiring a finance professional in Germany. The average salary for finance professionals can vary significantly based on experience, location and the specific role.
The average salary for a Financial Controller in Germany ranges from €69,000 to €90,000 per year, while a CFO can earn between €120,000 and €200,000 annually. Finance professionals in cities like Munich, Frankfurt and Berlin tend to command higher salaries due to the higher cost of living and increased demand in these financial hubs.
Onboarding and integration
Once you’ve hired your finance professional, the onboarding process is crucial for their success. A well-structured onboarding programme ensures that the new hire quickly understands your business’s financial systems, culture and goals.
Companies with a robust onboarding process improve new hire retention by 82% and productivity by over 70%. Germany’s business culture can vary significantly between regions, so integrating the new hire into your company’s way of working is essential.
Regular check-ins, clear communication and easy access to necessary tools and resources will help your finance professional hit the ground running.
Hiring your first finance professional in Germany is a significant step that requires careful planning and execution – from understanding the right time to hire and identifying key skills to navigating the recruitment process and ensuring compliance with local laws.
Each aspect plays an important role in securing the right talent for your business. By following best practices, you can make informed decisions that will set your business on the path to financial stability and growth.
Get in touch with us today to discuss your hiring needs and how we can help.
