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Big Four in Russia

Deloitte last of the Big Four to exit Russia and Belarus

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All of the Big Four accountancy firms have announced their intention to exit operations in Russia and Belarus.

7th Mar 2022
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Deloitte is the final Big Four firm to pull out of Russia and Belarus. The firm has now joined the ranks of Big Four firms EY, PwC and KPMG in announcing their decision to exit operations in Russia as a result of its invasion of Ukraine.

PwC was the first to announce its decision on Sunday night, followed by KPMG, after pressure mounted on the Big Four firms last week.

The severing of ties with Russian Big Four member firms follows consultancy firm Accenture’s decision to discontinue its 2,300-person Russian business on Friday, while mid-tier accountancy firm Grant Thornton split from its Russian affiliate on 1 March.

Deloitte confirmed in a statement that after reviewing its business in Russia the Big Four firm has decided to separate its practice in Russia and Belarus from the global network of member firms and it will no longer operate in those countries.   

“While we know this is the right decision, it will have an impact on Deloitte’s approximately 3,000 professionals located in Russia and Belarus. Like others, we know our colleagues in Russia and Belarus have no voice in the actions of their government. We will support all impacted colleagues during this transition and do all we can to assist them during this extremely difficult time,” said Deloitte global CEO Punit Renjen.

“We will continue to prioritise the needs of our people and clients while we bring the full strength of Deloitte’s global resources to bear in addressing the mounting humanitarian needs in Ukraine and across Europe.”

EY severs ties

Deloitte’s announcement follows a similar stance taken by EY this morning (7 March). 

EY said it was restructuring its Russian member firm to separate it from the global network and that it will no longer serve any Russian government clients, state-owned enterprises or sanctioned entities and individuals anywhere in the world.

In a statement EY added: “This is not something we take lightly. This is heartbreaking as we have over 4,700 colleagues in Russia, who have been a part of our global network for over 30 years and worked side by side with our global, Eastern European and Ukrainian colleagues. As we go through this change, we will work to support those colleagues, as well as our clients in fulfilling our legal obligations and commitments.”

PwC exited first

On Sunday night PwC announced its decision to cut off from Russia. In a social media statement, global chairman Robert Moritz said: “Last week we set out our position deploring the Russian government’s invasion of Ukraine. Since then we have also been thinking about how we can take action in the way we run our network.

“We have decided that, under the circumstances, PwC should not have a member firm in Russia and consequently PwC Russia will leave the network.”

He added that the firm would work with PwC Russia, where it has 3,700 partners and staff,  “to undertake an orderly transition for the business”.

KPMG was next to leave

Hours later, KPMG global chair Bill Thomas said his firm would do the same. KPMG has 4,500 people across Russia and Belarus and those firms will now leave the network.

He said: “This decision is not about them – it is a consequence of the actions of the Russian government. 

“We are a purpose-led and values-driven organisation that believes in doing the right thing. We will seek to do all we can to ensure we provide transitional support for former colleagues impacted by this decision.”

KPMG UK chief executive Jonathan Holt added: “We are appalled by the Russian government’s unprovoked military invasion, in violation of international law, and the war it is waging on the people of Ukraine.

“We believe we have a responsibility, along with other global businesses, to respond to the Russian government’s ongoing military attack on Ukraine.”

Last week KPMG said it was reviewing client work and operations to align with sanctions and comply with all new laws. Holt said that review is now complete and it will terminate the “small number” of contracts that are related to individuals or entities controlled by the Russian state or connected with the Russian regime.

BN IMG

Replies (8)

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By philaccountant
07th Mar 2022 10:23

Stable door, horse. They've all made their money already.

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By Ben Alligin
07th Mar 2022 10:25

Surely KPMG could do more damage to the Russian economy if they stayed!!

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By Duggimon
07th Mar 2022 10:39

This withdrawal is the result of a calculation, the cost of staying and appearing to support Russia and the cost of leaving. Note they are disaggregating their Russian operations and not closing them, which I would imagine has some degree of financial compensation built in that will no doubt not be mentioned in any press releases.

The Big Four are in no way leaders of the profession and haven't been that for many years now. They are the firms with the worst in ethical and moral standards, the worst fixation on profit above all else and deserving of little more than scorn from anyone who's still proud of the profession.

I would have more respect for them if they stayed in Russia and were at least open about their desire for earnings above all pretence of ethical concern.

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By Hugo Fair
07th Mar 2022 11:53

If they were prepared to take a direct financial hit themselves, they would have done this a week ago (before positions could be 'unwound' and billions disappeared into the electronic miasma).

War has to be met with 'force' - which in the case of the Big 4 should mean seeking to causing financial damage, not just walking/looking away (after no doubt cauterising the wounds of disentanglement).

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By Paul Crowley
07th Mar 2022 12:49

Agree all
Way too late as all money and yachts now safe from sanctions.

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By richard.snape
07th Mar 2022 13:16

"We are a purpose-led and values-driven organisation that believes in doing the right thing."
Reminds me of a quote I think from Churchill about the Americans joining the war.
"You can always rely on the Americans to do the right thing, (once they have eliminated all other possibilities.)"

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By Justin Bryant
07th Mar 2022 16:38
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By dubuque
10th May 2022 09:07

War must be met with 'force,' which in the case of the Big 4 should entail attempting to cause financial harm rather than simply walking away https://basketbrosio.com (after no doubt cauterising the wounds of disentanglement)

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