The Big Four are quintessentially global organisations, their logos adorn major commercial centres and they are prominent players in most western economies. Unlike their corporate counterparts, their governance structures are more opaque. This is a consequence of the partnership model which gives a high degree of independence to each country in which the Big Four operates. Global organisations –in general – and the Big Four in particular invite the following question: to what extent is there convergence or divergence between their operations in different countries?
We set out to answer this question by researching partners in Canada, France and the UK. We were particularly interested in the types of people that became partner and the process of them actually getting there. Was this similar across the three countries or were there striking differences?
The broad career structure is much the same across the three contexts: following qualification, employees move into the manager position – during which time many tend to leave the firm – before proceeding to senior manager, director and ultimately partner. Only 2-3% of members of the Big Four will ever make partner; ascension to this position is to enter the elite of the accounting profession. In provincial cities, Big Four partners are well known “business celebrities”, while in capital cities they are players within their service lines. Partners are the pinnacle of the accounting profession for those that remain in private practice.
It’s a cliché, but cash is king. The Big Four are packed full of extremely competent technical specialists – what makes someone stand out is their ability to generate fee income.
We started by looking at British and Canadian partners. What we found was remarkably similar: it takes most partners 15-17 years to become a partner after joining; 60 to 70 hour weeks are the norm; partners are more likely to be white and male; the process of becoming a partner has become far more formalised than it was in the past; most people who make partnership highlight the importance of “having a good mentor” to help them navigate the complex, Byzantine politics of a Big Four firm.
To add to this picture, interviewees emphasised the importance of trust: does the firm trust a candidate enough to make them a part-owner? All of this takes place against a broader economic backdrop which will determine whether a particular service is deemed worthy of supporting a further partner. The economic conditions can in boom times create more partnerships in a firm; recessionary times can preclude gifted candidates from making partner.
We talked to over 50 partners, ex-partners and people who didn’t make partner in Britain and Canada. The similarities far overshadowed any differences. Partners were very much “self-made men” and, save for a few exceptions, were drawn from modest social backgrounds. This meritocratic quality was deeply infused within the firms we visited, with a notable ‘can do’ ethos. The driven quality of the partners often extended to their leisure pursuits. Whereas the stereotype is of a partner playing a good deal of golf, they were much more likely to be competing in endurance cycle races or long distance running events. The participation in endurance sports is a fitting metaphor. Partners are driven, high energy people who exude self-confidence.
By midway through our research we were accustomed to partners recounting that “their career was different”. This statement surprised us as most of the partners spent most of their careers in one firm, something that is very unusual in the contemporary workplace, and we imagined that there was a distinct career path. The expression, however, spoke to the different ways in which the partners had proved themselves.
In every case, the accountant “proved themselves” through completing a difficult piece of work that gained praise from the firm. This demonstrated that the accountant had ability and could be trusted by the organisation. This building of reputation brought the accountant into new networks in the firm where more opportunities arose. Proving oneself as being very good at a complex job is generally enough to get a promotion to director. Beyond that, wannabe partners need to demonstrate that they can move effortlessly with senior executives in client firms and that they can generate revenue. It’s a cliché, but cash is king. The Big Four are packed full of extremely competent technical specialists – what makes someone stand out is their ability to generate fee income. Entrepreneurialism is a prime quality.
The similarities between British and Canadian partners were striking regarding this topic, in fact the only compelling difference was that British partners went for football and rugby metaphors, while their Canadian counterparts used ice hockey and NFL.
We travelled to France to find out about the French experience. Our intuition was that the capacity to generate new business would be crucial there too but that leverages to increase turnover might be of a different nature. In particular we expected that belonging to a cultural or social elite would be essential for partners to bring in new business in France. The Big Four are similarly prominent in France, although there are different rules around audit rotation. What became immediately clear was the Big Four are structured differently in France.
First, it was incredibly important where an employee had studied. In France, there are a number of Grandes Ecoles that are, in effect, elite Business Schools. The Big Four strive to recruit a quota from each of these schools. Unlike in Britain, where the Big Four recruit from a wide range of universities and where partners are pretty diverse in terms of their educational backgrounds, in France attending one of these Grande Ecoles will vastly increase your chances of getting recruited in the first instance, and is even more important in rising to partner grade in the second instance.
One of our French partners explained: “We are worried when we don’t have enough ‘parisiennes’ [graduates of top Grandes Ecoles]. I find that daft but in this firm we always have the illusion that if you haven’t been to a ‘parisienne’ then you can’t be a partner. That said, given that the clients of tomorrow will have studied at the same place, it is better to have them.”
The ability to generate business and ‘grow the cake’ is an absolutely central skill for someone who wants to make partner
The quote reveals a great deal about how educational background is a determinant of future success in the Big Four in France. Simply put, having graduated from a top school (a parisienne) marks out an employee as special and puts them onto a different career trajectory from those who had attended more routine universities. In France Big Four firms agree with each other on starting salary grids depending on the school category of their recruits. High expectations are placed very early on their recruits from Grandes Ecoles and this has a very basic economic rationale.
It is through the process of offering parisiennes more varied and exciting work – projects that add value and generally “pampering” them – that their “specialness” becomes a reality in the French Big Four. Contrary to what we expected, educational pedigree actually becomes more important at the partner level: it is easier for graduates of the Grandes Ecoles to interact with each other and so future sources of revenue will come through the conversion of their educational background into social skills and new business for the firm. It is a fascinating contrast to the British and Canadian experiences where the treatment of recruits is much more homogeneous. More broadly, the French experience is suggestive of the grip that Grandes Ecoles have on elite careers within the French corporate sector.
The Grandes Ecoles cast a long shadow over the Big Four in France; this raises questions as to whether a different set of qualities are required to become partner. A key insight from our research study is that the pressures that French partners and aspirant partners face are much the same as in Britain and Canada: clients need to be kept happy; new business needs to be generated and delivered; new service lines need to be developed; for personal career strategies, aspirant partners need to be seen as less technical and more strategic.
In short, the descriptions of the Big Four in France were remarkably similar to their counterparts in Britain and Canada. What was particularly striking was the creed of commercialism that underpins the Big Four across the three countries. One partner in France explained: “The first thing we look at is [the candidate’s] commercial skills. Dilution [of profit-per-partner] is a real concern for us. If partners don’t bring in revenue, the partners’ committee will lose money because there is less to share in the end. So the capacity to make business grow obviously matters a lot.”
This quote could have come from any of the firms in any of the three countries. The ability to generate business and ‘grow the cake’ is an absolutely central skill for someone who wants to make partner. The central difference between Britain, Canada and France is that in the French case the assumption is that being a graduate of a Grandes Ecoles will help generate new business. In Britain and Canada it is demonstrably not the case that an elite degree will lead to these outcomes. In France, attendance at one of these schools has a huge bearing on an alumnus’s future career in the Big Four.
Our research emphasises that people skills – the ability to get on with people and build durable networks – are crucial to success in a Big Four career. These skills need to be converted into revenues. To put this in some sort of context, the following revenues were quoted to us. In Canada, one interviewee suggested that a partner needed to generate around $3m (Canadian) per annum (£1.63m), in France this figure was estimated at €3m (£2.4m), whereas in Britain, a figure of £2m was frequently cited. Partners are clearly under pressure to generate vast sums of fee income for the Big Four; the prospect of being able to generate such fees is crucial to ascending to a partnership.
We started this article speculating about the convergence and divergence across the Big Four in Britain, Canada and France. We explored this in relation to partnerships in each of these jurisdictions. To our surprise there was strikingly little difference between Britain and Canada: careers broadly followed the same pattern in both countries. In contrast, France was a case apart. Interestingly, the objectives of the firms were broadly the same, but the educational backgrounds that were deemed necessary to become senior in the Big Four were very different. In Britain and Canada the Big Four are important bastions of meritocracy: once you get in, it’s up to you to prove what you can do. In France, the dice are loaded in favour of those holding elite Grandes Ecoles qualifications, it predestines their route to the top. For those entering French firms without elite qualifications, opportunities are likely to be far narrower than their British counterparts.
Chris Carter is chair of strategy and organisation at the University of Edinburgh Business School; Crawford Spence is professor of accounting at Warwick Business School; Claire Dambrin is associate professor in the management control department at ESCP Europe, Paris.