Really, Sacha Romanovitch should be intimidated. As CEO-elect of Grant Thornton, she is about to step into the shoes of Scott Barnes, a CEO so revered his board unanimously voted him as global chairman, and a CEO so successful he reached his financial target for the firm a year early. As the first woman to take the reins of a major accountancy firm, Romanovitch’s arrival has also catapulted her firmly into the limelight, so all eyes will be on her when she takes the top job next month. Even so, she isn’t intimidated in the slightest.
“There was one moment where I had a big gasp of ‘oh my gosh’,” she says. “But now I’m just excited.”
So does anything worry her? “No. And not a lot keeps me awake at night because I meditate and practice yoga.” She pauses. “Though any leader who’s honest has a bit of imposter syndrome where you think ‘they’re going to find me out’. But that’s human.” The last time she felt intimidated, she says, wasn’t in the office at all; she was riding a jet ski in the Maldives. “We’re doing 30mph and I’m absolutely terrified and I’m thinking, ‘holy cow, this is really scary’, but my son was on the back saying, ‘go faster mummy, you can do this, you’re a CEO’.”
That Romanovitch’s leadership style is vastly different from Barnes’s is an understatement. Asked to sum up his style in three words, she boils it down to one: “Yorkshire”. Her own, she says, is “like India”. She explains: “Scott is straightforward. He’s focused and direct, hence Yorkshire. Whereas I’d call myself India because it’s full of colour and buzzing with energy.”
Cutlure is the hard stuff. Anyone who thinks it's soft hasn't understood it
Barnes and Romanovitch were both educated at Oxford University (Romanovitch with an MA in chemistry), then qualified as ACAs and have gone on to become CEO of Grant Thornton. But whereas Barnes trained at Arthur Andersen, Romanovitch qualified at a smaller Windsor-based firm, which later merged with Grant Thornton, where she has remained, with the exception of a year-long sabbatical in India. Defending her “lifer” career, Romanovitch says: “I have met people who have worked in lots of different firms and who are still terribly closed, but I’m a person who looks out.”
She accelerated quickly from partner to managing partner of tax and audit practice in London, and is currently head of London Advisory, the largest and fastest growing part of the firm, as well as head of people and culture. Although that’s not an obvious feeder role to CEO, nor is it fluffy. “Culture is the hard stuff. Anyone who thinks it’s soft hasn’t understood it,” says Romanovitch.
But what really sets Barnes and Romanovitch apart are their goals. In 2012, Barnes set a financial target to hit a turnover of £500m by 2015, which he achieved a year early. But as Romanovitch explains, the remit now is to evolve the focus from profit, scale and market share to value creation for clients; to be seen as the “go-to firm for growth”. She still intends to double bottom-line profits by 2020, although she declines to set a target for revenues “because there are a lot of players chasing top-line growth and that can be a bit of a fool’s game”. Pre-tax profits stood at £81.2m in 2014 and Romanovitch wholeheartedly believes her target is “sensible”. Though she emphasises it is nowhere near as important as her main target: to make Grant Thornton known as “the firm that is really helping to shape the UK economy”.
She explains: “I want us to be an advisory firm that is able to provide assurance services that support the trust and integrity of markets. And I want any business that wants to grow to see Grant Thornton as the place to come.”
This is admirable in theory, but how it will work in practice is harder to get out of Romanovitch. There is a clear focus on the advisory practice, she says, which grew by 15% last year, rather than on tax or audit. And this is an important distinction: she sees the firm as a broad-based advisory firm rather than a narrower accountancy practice. And she doesn’t view this as a change in direction but as an “evolution”. She says: “Scott and the team earned us the right to step into this space.”
But the parameters of that space aren’t exactly defined. “In many respects our main competitor hasn’t emerged in the marketplace yet,” she explains. “I see them as the new entrants and disrupters as opposed to established firms.”
The specifics of her plans are laid out in a meaty 12-page manifesto, which Romanovitch began creating a year ago when she decided to apply for the CEO role. She covered the walls of the sewing room (she has been interested in design and couture since she made and sold ball dresses to support herself at university) in her Devon home with paper and began brainstorming. This was later reduced to a manifesto, written somewhat incongruously in a bling New York apartment formerly owned by music star Moby, which Romanovitch rented on her way to a global partners meeting. “It had glass chairs and a huge glitterball,” she says, laughing.
Mid-sized business are going to be the engine of growth. That's a massive opportunity for Grant Thornton
Yet the manifesto is a document she takes seriously, based as it is on a series of philosophies she describes at length. “I believe there needs to be a massive shift in what business is doing for the UK economy to make sure it is relevant in the global economy. Mid-sized businesses are going to be the engine of that growth. That’s a massive opportunity for Grant Thornton.
“You have the shifting world and economy in terms of what’s valuable; you have the shift of power to the east; you have the social system in the UK whereby you know that not everyone is contributing to the economy; plus we’re addressing the challenges from 2007 – is the UK still seen as a trusted economy?”
After reeling off a list of further questions, she pauses. “I’m going off on a tangent,” she says. “You’re going to have fun trying to unscramble this.” In essence, Romanovitch’s premise boils down to three things: in order to get the economy “on track” she believes the UK must first ensure it is an easy and attractive place to do business, that there is trust and integrity in financial markets and that businesses can thrive. “Those things are really important but to some degree they are all broken. What drives me is working out how to fix them.”
So how does Grant Thornton fit into tackling those issues and helping to drive sustainable business growth? Romanovitch believes that her firm is uniquely placed to support its clients as well as influence the agenda by speaking out on issues that really matter. Asked how she might instigate change, she talks about creating an “innovation culture” and providing a framework for everyone in the firm to bring their ideas forward.
Romanovitch is adamant that her leadership style is open door. (In fact, she doesn’t even have her own office, never mind a door.) “We’re starting to remove the hierarchical nature of the business,” she says.
So can people come to her directly with ideas? “Yes they can. And they do. And they get implemented.” She gives an example where a group of trainees suggested creating a recruitment blog and completely changing how Grant Thornton engaged with people on campus. She agreed and today Spilling the Beans is an award-winning social media campaign.
When asked what makes her successful, Romanovitch says: “The people around me believed you could change the world, so I believed I could change the world. I came up through quite a matriarchal culture. I was adopted at 18 months old. My mother had three sisters above her, all strong and definite women. I went to an all-girls school and then an all-girls college.”
Romanovitch doesn’t shy away from the gender issue. When her appointment was announced, the focus was on her being the first female CEO of a major accountancy firm. In many ways, her gender took centre stage before her credentials in the ensuing press coverage, which must have been irritating. “Actually, I look at it as an opportunity to discuss what diversity really means,” argues Romanovitch. “Diversity goes much deeper than gender, colour or sexuality.”
Nor does she see her appointment as especially revolutionary in the struggle for women to be appointed to top roles. She simply sees herself as an individual with a unique set of circumstances that worked out well.
“I couldn’t do what I do if I didn’t have a husband who is supportive and at home full-time with our children, so I’m uncomfortable when people say ‘if she can do it, anyone can’. That’s nonsense. I made choices that were right for me and my family. They won’t be right for others.”
She is, however, comfortable with the public-facing side of her new role. Likewise, she is at ease with the pressures of being a chief executive in the Twitter age. She’s good at it too, with 1,500 followers, double that of Barnes. “I love, love, love Twitter,” she says. Asked whether she is concerned that what she says off the cuff will stick with her, she is clear that she isn’t. “I don’t tend to have regrets. I wear my heart on my sleeve and say what I believe. Other people may believe differently. But this is me.”
Which brings us back to her unshakeable self-belief that she could, as she puts its, change the world. This is something she has been reflecting on during the year-long CEO election process, which coincided with her mother being hospitalised. “I was spending three nights a week in the hospital with Mum and she started giving me anti-pep talks,” says Romanovitch.
“She’d say things like: ‘You know that what you’re doing doesn’t matter, don’t you? It doesn’t make a difference.’ And I’d say: ‘If I believed that I’d have no reason to go on living.’ I have to believe that what we do matters.” She continues: “If you’re led by that belief then anything really is possible.”
Explaining the decision, Romanovitch, said, “My ambition is for all of our people to have a stake in Grant Thornton becoming the go-to firm for growth. The only way we can fully harness the potential of all 4,500 of our people is through shared enterprise - a sense that we are all in this together sharing our thinking and ideas, sharing the responsibility to drive the business forward and sharing in the resulting rewards.”
BIG ISSUES IN BRIEF: SACHA ROMANOVITCH
In or out of the EU? In. Britain’s ability to influence the global economy as part of Europe is greater than it is on its own.
Audit reform, good or bad? Good. We need an audit system that delivers trust and integrity.
Does more competition mean improved audit quality? Not necessarily. Anything that causes businesses to think about what they need from audit and how best to deliver that is a good thing, though.
Are mid-tier firms equipped to audit FTSE100 companies as effectively as Big Four firms? I think so. Though the auditor needs to be of a certain scale to have the resources to deliver it.
Who is best placed for professional oversight of audit – ICAEW or the FRC? In terms of oversight, the FRC. In terms of quality of auditors, ICAEW.
Is the FRC fit for purpose? It’s evolving. At its best, it works in an inquisitorial rather than accusatorial style. I’d like more of that.
Is it doing enough of that at present? For people undergoing regulation, it can feel tough. You can conduct reviews in a really constructive way. I’d love it to always happen like that.
Media coverage of tax evasion – fair or overblown? Media coverage has missed the point; tax is a cost of doing business. Government has a responsibility to create a fiscal regime that balances raising funds for the exchequer with the cost of doing business.
How difficult is it for you in the current climate to help your clients minimise their tax bills? Our job is to help them look at it as a sensible cost of business, paying a fair amount, but not too much.
Sacha Romanovitch is a member of economia’s Editorial Advisory Board