"Professionalism” is a word you are going to be hearing a lot about over the coming year if Andrew Ratcliffe, incoming ICAEW president and soon to be retired PwC senior audit partner, has anything to do with it. He believes the word – which is so important to the chartered accountancy profession – has become devalued and during his presidency he’s determined to restore its proper meaning.
“Professional, as opposed to amateur, can just mean that you are paid for what you do; but when we use the word we mean more than that. The word has become overused, but if we are to reclaim it we need to be able to explain what we do mean and by what right we continue to call ourselves a profession. The word comes from belief, commitment and making a promise. Yes, for us, it’s about public interest, values, integrity. And that’s the difficulty,” he adds wryly. “You’re exchanging one rather squashy word for a whole load of even more squashy words where there is even less consensus about what you mean.”
We needed to up our game and tell our story
A tricky task then, but Ratcliffe loves a challenge. He will bring to the question nearly 40 years’ experience as an auditor to some of the world’s largest and most complex companies, including Royal Dutch Shell, GlaxoSmithKline, Royal Sun Alliance and Barclays, as well as seven years as a member and then chairman of PwC’s global board.
Those years were really challenging times, he recalls, but ones he “would not have missed for the world”. His tenure as chairman began as the profession (that word again) was still suffering the aftershocks of the collapse of Enron. In short order the board had to appoint a new chief executive, Sam DiPiazza, work with him to dispose of the worldwide consulting businesses to IBM and determine a new strategy for the network.
Ratcliffe’s career could have ended up very differently. He cheerfully admits that he had never heard of chartered accountancy until he left the University of Cambridge armed with a maths degree and a strong desire never to find himself “sitting in a room on my own thinking weird, abstract stuff”.
He thought he might like to “do something with people”, which gave him the idea of going into business. “I realised I knew nothing about it, found out about chartered accountancy, and decided I wouldn’t be wasting the next three years because I’d learn how companies worked, get a qualification and maybe discover at the same time what I really wanted to do.”
He joined Coopers & Lybrand (now the Coopers in PwC) and was hooked. “What kept me in the profession is the variety. I can’t claim there was a master plan, but I took opportunities when they came along. I have been fortunate to work with clients in a lot of different industries,” Ratcliffe says.
Being an auditor is a privilege, he adds. “I think the relationship between an auditor and his client is unique – genuinely – in terms of professional services. You are there with your client with a common goal of producing a set of accounts that are true and fair, balanced and understandable. In that sense you are like any other professional in assisting your clients to do what they want to do. Yet you have the added responsibilities of your profession and the public interest. If you don’t like what your client is doing, it’s not just a matter of ‘do I feel happy acting for you any more?’ You actually have the sanction that stops them doing it.
“There may be times when you need to have that tough conversation, but then, the next morning, you start again with the same open constructive respectful relationship you had before. I’ve always enjoyed that dynamic, not just helping people to do things that they want to do, but also that sense that you are there to help them do what’s right.”
If Ratcliffe’s career choice was down more to luck than choice, so too was his involvement in ICAEW affairs. Following the merger that created PwC, the two heads of audit who previously represented their old firms on the Audit Faculty committee decided that the new firm should just have one representative. Rather than battling it out, they picked him.
“I thought of it as a duty thing, but when I started I absolutely loved it. It opened my eyes to the fact that the profession is so much more than what I had seen in my own firm. The people sitting on the faculty committee ranged from the biggest audit firm in the land to Peter Upton, a very successful sole practitioner from Nuneaton. It was a chance to get involved in thinking more widely about what happens with audit.
“Of course, if you stick around for long enough, people ask you if you would like to chair it, then the technical strategy board, and before you know it, you’re running for president…”
He says he started seriously thinking about being president when he saw the impact of the financial crisis on the profession and decided that “we needed to up our game and tell our story”. He wants the profession to be seen as open and inclusive rather than succumb to the easy description of being a “conspiracy against the laity”.
This means attracting young people from all walks of life and giving them equal opportunities. It’s also about responding to the issues of the moment fearlessly – whether it’s ensuring that business has its voice heard through the ICAEW general election manifesto or reacting to the current pressure on the profession over tax.
Of course, the next 12 months won’t be all seriousness and “professionalism”. At home, Ratcliffe keeps bees (“fascinating”) and grows vegetables (“the greatest satisfaction”) and he’s just as likely to ask how to grow okra (“it germinates, it grows and then it just goes ‘blurgh’ and dies on me”) as discuss the latest developments in auditing standards. But rest assured, he will bring the same care, thoughtfulness, dry wit and rigorous intellect to bear on the profession’s problems as he would his prize tomatoes.
Career in a nutshell
2014-present chairman of audit committee, Royal College of Music
2014-present treasurer, Film on Friday
2005-present member, ICAEW board
2001-2004 chairman, ICAEW audit and assurance faculty
2001-2005 chairman, PwC global board
1998 partner, PwC
1986-1998 partner, Coopers & Lybrand
1979 qualified, Coopers & Lybrand