CFA Society Chicago Progressive Networking Luncheon


CFA Society Chicago’s Progressive Networking Luncheon held on February 22nd at Petterino’s was an opportunity with a different flavor than other networking events.  Featuring a three-course meal, each course provided an intimate opportunity to chat and really get to know fellow table guests.  As the course changed throughout the lunch, so did your table guests! The format transformed the networking from one with challenges to begin conversations to one in which fellow diners were a part of the flow of topics. It made it remarkably easy to ask questions, gain insights from others and provide your own food for thought.

The attendees were delightfully varied as well. In addition to attendees from industry mainstays such as Northern Trust and William Blair, others from further afield industries, yet still very much in finance roles, provided interesting insights. Students also had the opportunity to learn from potential future colleagues.

Join us next time to enjoy a great meal while networking with interesting people!

The Art of Negotiating Compensation: Getting Paid What You Are Worth

Laurel Bellows is the Managing Partner of her namesake, boutique firm, The Bellows Law Group, P.C. whose practice areas include Executive Compensation, Business Consultation, Business Litigation, Employment Law & Human Resources, and Personal Legal Services.

Bellows focused on tips and topics for negotiating compensation packages, yet frequently widened the scope by noting these strategies are applicable in any type of negotiation.

dsc_3183A key takeaway was preparation is power. Bellows suggested writing out your own, ideal or dream deal to have as goal which you can test to ensure your expectations are realistic. Likewise, one must also take into account whether or not the company’s goal to determine your performance/bonus is also an achievable goal. To assist in this process, Bellows had a novel approach. In addition to using resources such as trade associations, public data (if one is lucky), and informational dsc_3159interviews, she suggested a brainstorming session. Inviting friends over for a candid discussion and feedback over drinks could enhance your preparations.

The key to negotiation is determining what you are worth, regardless of previous earnings. Determine your level of responsibility, skills, and efforts beyond simply whether you are generating a cost or revenue. Ideally monetizing your value will create leverage. More importantly, it will establish a connection to the employer’s perspective with your understanding of the position and potential role in the greater organization. Nevertheless, employers’ key challenges remain; identifying, motivating and retaining talent.

dsc_3162During the initial negotiations, if the employer asks for your compensation target, then assure them that they can come to an agreement. Emphasize you are really interested in joining the team and would prefer an offer before discussing specifics. With an offer in hand, force the employer to specify the numbers of the compensation package first. With a significant pause and a flinch or “hmm…,” counter with a nearly “blush-level” offer. From this dsc_3167point on, your research and preparation becomes your support to confidently negotiate with informed certainty. You have anticipated their counter argument and able to support your case. You may concede a lower initial package if you can have a six-month performance review to have the opportunity to earn a package closer to your initial offer.

Finally, always have a best alternative at any moment. If you are fortunate, it may be taking an offer from different employer or realizing the negotiation will not end in an agreement and walking away.

Check out Laurel’s 10 pointers below:

Bullets by Bellow: 10 Pointers for Successful Negotiations

  • Prepare, prepare, prepare
  • Determine the extent of your counterpart’s authority
  • Set a precise goal. Be able to justify your goal and quantify your demands
  • Put your dream agreement in writing
  • Keep your best alternative in mind
  • Identify other party’s principal goal and best alternative
  • Role Play: Practice your questions. Anticipate answers to questions you will be asked
  • Strategize Timing
  • Your name and your reputation are inseparable
  • Remember: Not every negotiation ends in agreement

Distinguished Speaker Series: Charlie Dreifus, CFA, The Royce Funds

DSC_2907“The proliferation of non-Gaap (financial measures) has added to the proliferation of growth,” said Charlie Dreifus, CFA.

Dreifus is a managing director and portfolio manager with The Royce Funds which focuses on providing small-cap, value mutual funds.  Dreifus is the portfolio manager for the Royce Special Equity Fund and the Royce Special Equity Multi-Cap Fund, with over 18 and 5 years on the funds, respectively.

Dreifus’ focus, for many years, has been on the value approach to portfolio management.   A key aspect of his approach is the utilization of accounting skepticism.  Dreifus shared his thoughts on the increased usage of non-GAAP measures and the resulting side effects.

He started with a story.  He had a conversation with a particular company to seek GAAP guidance.  Although the company already provided non-GAAP guidance, Dreifus was informed that “GAAP guidance is unavailable without unreasonable effort.”  Dreifus responded, “…but you need GAAP to get non-GAAP.”  And the attendees broke out laughing.

DSC_2918Dreifus reported that the number of S&P companies reporting non-GAAP measures has increased to 88%.  The consequences of the increased focus on non-GAAP include decreased clarity in reporting results and in increase in wiggle room to achieve desired results.  The desired results have, of course, have a direct linkage to executive and incentive compensation.  Executive compensation is being geared more towards non-GAAP and with the ability to front load expenses with non-GAAP measures, financial windfalls can be significant.  Audit committees have been strengthened by Sarbanes-Oxley.  Dreifus would like to see the committees act to disallow the gaming of earnings to beat analysts’ expectations.  They should take more responsibility for the reported economic stats.  Ideally, we would see “full, fair & balanced reportable numbers.”

Dreifus finds the number of times audit committees meet informative.  If the number is low or high, it raises a red flag.  He would like to believe that changes to our non-GAAP reliant system would develop within the audit committee; however, the challenge is sparking any involved person/party to take ownership of the responsibility.

On the other hand, Dreifus does grant that GAAP is not perfect either.  Nevertheless, his goal is to raise the level of consciousness within the industry and its participants.  Especially in the context of recent record-setting equity market levels, the talk has motivated deeper reflections on valuations.

Crunch Time! CFA Society Chicago Cram Session

DSC_2760Dan McKenna, CFA Institute’s Manager of Supplemental Study Tools, led off with insights and advice directly from the source.  New charterholders and study partners, Shai Dobrusin, CFA, and Jay Bullie, CFA, shared their thoughts and where their studies differed.  Dobrusin, Trust Associate and Financial Analyst at Charles E. Dobrusin & Associates, focused on the end of chapter problems in addition to the, now Kaplan Schweser, study materials and used the Kaplan QBank as supplement.  Bullie, Associate Director at Fitch Ratings, added that relying on Kaplan alone is debilitating, especially in regards to new material.  Kaplan tends to avoid adding CFA’s new material because it is not consistently tested. Bullie experienced these new questions and had to “suck it up and move on.”  Russell Rhoads, CFA, had the most unique route to becoming a charterholder.  He gained the designation 13 years after taking Level I because the hedge fund he worked for discouraged taking the exams.  Also, as the Director of Program Development, Options Institute at the CBOE, he is one of the few at the exchange with the designation.

After the panel discussion, attendees were fortunate to ask additional questions at level specific tables.


  • DSC_2765Repetition is key to success. You are able to gain familiarity with the structure, format, and level of difficulty.
  • Utilize the learning outcome statements to direct your focus (i.e. do you need to know the formula or just the concepts).
  • Examples in the text are very helpful.
  • Optimize your remaining study time so you can cover all the material, master the challenging topics, and keep the mastered topics fresh.
  • Scale back the final week and if you are not done reading then focus on questions.
  • Relax the day before the exam and ensure you gain plenty of rest.
  • Take as many practice exams as you can. Replicating the test environment for at least one is helpful.

Level II

  • Mark up the vignettes to easily reference the facts.
  • Repetition and practice will make you more efficient.

Level III

  • The questions and answers rely heavily on the curriculum.
  • About 700 graders look for key items to give credit. After 7 hours of looking at an answer, graders appreciate your efforts to make it easy to give out points (bullet points, underlining).
  • You can get partial credit even if your formula is not 100%.
  • There is no extra credit. If the question asks for three points, anything beyond will be ignored.

Future Exams

  • CFA Chicago gives out scholarships for all levels including the Level I exam in December.
  • The Study Group Kick-off Party and Open House for the December 2016 CFA Level 1 exam will be held on July 12th at Norther Trust.

“I’d far rather be happy than right any day,” except on exam day (adapted from Douglas Adams).

Onward and Upward: Recruiter Views on Job Changes and Career Management

DSC_2756Looking to enter the finance industry or achieving the next step by becoming CEO?

The panel of internal and external recruitment specialists had great advice for all stages of one’s career. Although working with external recruiters was a key focus, the two internal recruiters provided an additional perspective.

Although it is straightforward for gentlemen to wear suits to interviews, Robert Becker, Senior Recruitment Partner at BMO Harris Bank, has observed that is not always the case. On the other hand, ladies do not have it so easy. Laura Pollock, Founding Partner of Third Street Partners, recommended emulating Margaret Thatcher: Pearls are classic. She also advised on conservative colors and midsized heals.  What can we all do?  Make sure your shoes are polished.

Thank you notes maybe ubiquitous, but the finer points set applicants apart. Pollock and others stated a hand written note is ideal, but may not reach your interviewer(s) in a timely fashion, depending upon the company. The sure route is a thank you, within 12 hours, via email in which brevity is important.  Becker prefers two to three sentences that are personalized and unique. Jim Schroeder, Executive Vice President of DHR International, emphasized that one must write as though the interviewers would compare their thank you notes.

Cover letters are dead. Although Lyndon A. Taylor, a partner at Heidrick & Struggles, focuses on executive and board level placements, he spoke generally when stating cover letters have “no value.” Pollock added, when applying by contacting an employee directly, the body of the email is the place where applicants should state how they would add value. On the other hand, an acquaintance informed me that a well written cover letter secured him an interview. My conclusion is that the traditional cover letter is a dying breed in its current form. Evolution is driving it to change with some companies or be ignored in others. In short, it depends.

The Q&A session allowed attendees to address additional topics, such as references. Taylor mentioned three to five references are sufficient. Also, who is listed as a reference and who is not is very informative. The external recruiters generally check informal references first. So Pollock voiced it is best to leave a position in a graceful, thoughtful way.

Compensation can be unpleasant topic, but rest assured, every offer is negotiable. Schroeder continued by suggesting one could ask for additional vacation time; however the sum must be a function of historical economies, current economies, and the company’s internal economies. Negotiate what is most important to you. Julie Nagle, Head of Human Resources with Harris Associates, mentioned she used McLagan’s proprietary compensation publications to ensure their offers fit well within the three economies. Working with a recruiter has the added benefit where it is encouraged to discuss compensation and the filtered counteroffer is proposed.

In addition to the future compensation negotiation, a key topic for the recruiters was the truthful disclosure of a three to five year of historical earnings. Pollock stated if you are not upfront with your previous compensation, she cannot continue forward. Becker provided the perspective that if the requested compensation is out of their range; multiple departments have to rework aspects of the position delaying the hiring process by multiple weeks.

Schroeder recommends building the relationship overtime, but admitted that a failed return call happens on occasion, so recruiters sometimes need pushing. The key in developing the relationship is being forthright with your end goal. These comments seemed directed at the higher level positions and do not directly translate to higher throughput recruiters.

Other than chatting with current or former employees, it is difficult to gauge the culture within a particular company which sparked a discussion on Glassdoor. The panel concurred that employee reviews on Glassdoor should be taken with a grain of salt. One should look for patterns, trends, or common denominators as a means to gain insights.

Pollock addressed career gaps, especially for women. Sadly, taking time off to raise kids was historically frowned upon; however, today stating your focus during the break and your eagerness to achieve in the position should be sufficient. If the company doesn’t understand your decisions, it is probably a company you don’t want to work for. Julie added her encouraging, personal story of resigning to aid her family for about year and return to the force with Harris Associates.

Similarly, if one wants to move into an unrelated position, the panel stated it is best to work towards a move within the company to a comparable position. Otherwise, it becomes dramatically more difficult.  Becker mentioned BMO’s policy of supporting internal moves after three years to broaden individuals and teams’ experiences.

Finally, one of the best pieces of advice the panel mentioned was that looking for a job should be a part of your career.  Keep in contact with your network and reconnect with one’s you haven’t spoken to in over six months. Perhaps, a lifelong friend is a lunch-away.