Profession lags as white men dominate partner roles
The accountancy and audit profession is “lagging behind business” with a sizeable majority of partner-level roles being held by white men, the Financial Reporting Council (FRC) concluded in a new report.
New research from the FRC has drawn attention to the gender imbalance in the accountancy profession, with only 17% of women currently in partner-level roles.
The imbalance reflects the glass ceiling within audit and accountancy firms, where women make up 46% of manager-level roles: women are increasingly being appointed to middle-management roles, but the numbers thin past that point.
Ironically, many women and members of ethnic minority groups holding middle management roles often advise large corporations on their diversity strategies.
Off the back of the research, the FRC has urged firms to do more to maximise their pipeline of future talent and promote women, black and minority ethnic (BAME) and disabled employees to the top levels of management.
According to the FRC, the blame doesn’t just lie with the largest firms. Despite 52% of manager roles being held by women in firms with fewer than 200 employees, only 11% of women are partners at that level.
Only one in three audit and accountancy firms collect diversity date for their workforce, making it more difficult to diagnose the issue internally.
Women are continuing to join the profession in larger numbers. With women making up 37% of professional body membership (up from 35% in 2014), the gender imbalance at partner-level is likely to reach a tipping point before too long.
Profession wrestles with diversity
The FRC’s diversity drive comes as news emerged of an “out of touch” leadership and empowerment seminar at EY’s New Jersey office during the height of the #MeToo movement last June.
The Huffington Post reported that female attendees had to complete a ‘masculine/feminine score sheet’ and were advised on how they should dress and act around men. One speaker claimed women’s brains are 6% to 11% smaller than men’s and that their brains absorbed information the way pancakes soak up syrup, making it harder for them to focus.
As the EY event showed, the profession still has some ground to make up on diversity in 2019. Over in the UK, the debate intensified in May with a furore over a panel discussion on the future of accountancy that was made up entirely of men.
Heather Townsend laid into the all-male panel on social media and AccountingWEB, writing “it’s painfully obvious that creating a more diverse leadership population in accountancy is much needed”.
Townsend flagged the need for action to remedy the attrition that happens from the point of entry, where accountancy students are split 50/50. “However, we leak females from the profession at every stage of their career, culminating in only 18% of all partners in the top 100 accountancy firms being female,” she noted.
It’s better for all
Creating a fairer and more diverse workforce was one of Maggie Brereton’s main aims when she and her co-founder Ina Kjaer set up EOS Deal Advisory after leaving KPMG following alleged bullying from a male colleague.
Writing on AccountingWEB, Brereton argued that an inclusive workforce will create a better work environment for all: “It does not work to hire women, minorities, or others if they are not able to thrive in the organisation. The diversity of thinking is critical to attaining better results. But are we recognising and rewarding it?”
Accountancy firms challenged to lead by example
The FRC has responded by challenging accountancy firms to take rapid action to address the profession’s top-level gender imbalance and report on their progress. The watchdog is urging firms to sign up to the government’s equalities office pledge to tackle the gap.
Fresh from his tenure overseeing HMRC, the FRC’s new chief executive Jon Thompson said that there is a business case for the accountancy profession to improve diversity.
“While it is encouraging to see more firms implementing diversity and inclusion strategies and more women, ethnic minority groups and disabled people being appointed to middle management roles, more needs to be done to ensure the firms are not limiting access to the most senior roles,” Thompson said.
The findings are contained in the FRC’s Key Facts and Trends in the Accountancy Profession report, which indicates that the FRC and its successor body are committed to reporting on the profession’s diversity in greater detail as part of their Public Sector Equality Duty.