In the wake of the June Supreme Court decision banning race-based college admissions, the debate about the validity of workplace diversity, equity and inclusion programs has come into the open.
For accounting and advisory firms, the real question is not whether such efforts should be dismantled, but how to sharpen their focus as essential dynamics for survival. (Note: The ruling has absolutely no impact on your programs, nor should it create concern for firms.)
Diversity programs were initially designed to help firms thrive. The business case for attracting and retaining women, ethnic minorities and others who don’t fit the historic norm of an accounting professional was framed as a long game: Shift workplace culture to ease younger generations into workplaces that were incrementally more inclusive and flexible.
Now, DEI is essential for the profession to survive. Changing both the reality and the perception of the profession is the only hope of magnetizing recruiting and retention. Progress is picking up, according to the just-released 2023 Accounting MOVE Project results (see story).
Participating firms reported:
- An increase in women partners/principals from 27% in 2019 to 34% in 2023, a 17% increase in five years.
- Firms are losing fewer women in the transition from director to partner level, decreasing from 34% in 2019 to 29% in 2023, which means firms are losing 18% fewer women in this leadership transition.
- Women of color are making inroads as well, albeit at a slower pace. In 2019, 11% of partners were women of color and this number rose to 13% in 2023, an 18% increase.
That’s the reality among firms that participate in the Accounting MOVE Project, where strategies that buoy inclusion and consequent retention are shared, proving the DEI business case.
But overall, the profession’s reluctance to re-center around inclusion puts its sustainability in question.
In July, the Public Company Accounting Oversight Board released a scathing comment about the high and rising percentage of audit deficiencies and pledged to amplify firms’ accountability for audits.
And nationally, employees continue to prioritize inclusive cultures and self-directed workloads and schedules — even as many corporate leaders start to coast on DEI. A new Accenture report indicates that corporate leaders’ commitment to DEI hasn’t budged much since 2018. Meanwhile, 68% of leaders surveyed for that report claimed their employees are empowered. Only 36% of their employees agreed. That’s a huge trust gap.
That attitude prevails in the accounting and advisory profession. It is not uncommon for us to hear, “if it ain’t broke, don’t fix it.” Of course, what’s broke is in the eye of the beholder. Long-ensconced firm leaders often don’t think the career ladder they scaled is broken because, from the top, they can’t see the shattered rungs. The pride that the profession historically has taken in being the smartest and hardest-working folks in the room doesn’t resonate with millennials, and especially not with Gen Z who work to live instead of living to work.
Now, that misplaced machismo is coming home to roost. The profession is at a talent tipping point: If it cannot bring in new professionals, and fast, it could put itself out of business.
That’s why DEI is now about surviving, not thriving.
Thoughtful, consistent, evolving diversity efforts that hold managers accountable at all levels are the hallmarks of this year’s Best Firms, as determined by the Accounting MOVE Project research and supported by the Accounting and Financial Women’s Alliance. DEI is no longer the marker of firms that are progressive. It’s the marker of firms that intend to stay in business.
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