Accountants now running 6 out of 10 FTSE100 companies
- More than twice as many top companies now run by finance professionals than in 1990s
- Strategic insight increasingly recognised over other professions
- Strong representation for women and minorities overall but not at top of accountancy profession
Accountants are dominating the strategic thinking at UK’s leading companies more than ever before, according to finance and accountancy recruiter Marks Sattin.
More than twice as many FTSE100 companies now have a chairman or CEO with an accountancy or finance background (58%) than in the mid 1990s (24%). Fully qualified accounting chairman or CEOs, account for 40% of FTSE100 company leaders.
The rise of the manager accountant during the past 20 years has been quite clear.
Dave Way, managing director of Marks Sattin comments: “Of course accountants have always been best placed to contribute on fiscal matters, and the recessionary environment has made that more important, but it is their strategic insight which is most sought-after now. This generation’s finance heads have benefited from numerous advances. Technology has freed them to focus on management issues, with four times growth in the accounting software market from 1997 to 2010 changing the way accounts are kept. Additionally, the visibility of a company’s fiscal performance, and the communication of that information to multiple stakeholders in often complex matrix environments, has never been more key to the effective running of an organisation. The finance industry has also arguably benefited, more than any other professional discipline, from the best training and development; so accountants have had to hone their soft skills, their communication skills, more than most professionals in order to get on.
“These advances, among others, have also made the accounting profession more attractive to the best graduate talent in the last two decades; accounting firms and finance departments are where many potential leaders chose to begin their careers twenty years ago, it’s no surprise that the experience gained in their formative years has helped shape them to be the leadership talent pool of 2010. “We are seeing more accountants moving out of the backrooms and into the boardroom. In the boom years, a CEO with marketing experience may have been valued for his ability to build a brand. Now in the period post-recession, accountants’ firm grasp of financial issues and ability to provide reliable, sensible expertise greatly improves their prospects.”Increasingly, accountants are seeking roles which qualify them for more engaging roles down the line. It seems they have the long game in mind, so are prepared to switch roles to gain exposure to enticing work. According to over 1,500 accountants polled by Mark Sattin, career development, new challenges and interesting work, are more important than money. 30% of accountants moving jobs put better career development as the main motivation. 23% say that a new challenge/more interesting work is the main driver, while the same number say they want a better salary.
Way continues: “Accountants have a new-found power in the business world. No longer are they the ‘grey men in grey suits’ – instead their training opens the door to a world of commercial opportunity. People are realising how financial know-how can be a means to an end, rather than an end in itself.”
Doors are open for women and minorities but gender divide persists.
Accountancy has come a long way in the diversity stakes. In 2009, a majority (55%) of all new accounting graduates were women, who in turn made up almost two thirds (62%) of all new accountants and auditors. In 2000, less than one third (32%) of new entrants to the profession were women, and in the mid-1970s, this figure was less than 5%.
Ethnic minorities represent 30% of accountants polled by Marks Sattin. Less than 8% of the total UK population are from an ethnic minority, showing strong representation in the profession:
| Ethnic minorities in accountancy | |
|---|---|
| Ethnicity | Percentage |
| White British | 39.6% |
| White Other | 30.9% |
| Asian | 17.8% |
| Black | 6.5% |
| Chinese | 3.4% |
| Other | 2.0% |
However, despite improved representation overall, the most senior roles in the accounting profession are still largely held by white men.
Women represent 23% of all partners at firms, and 9.1% of all company CFOs.
Additionally, just 5.9% of partners in UK accounting firms are from ethnic minorities. Figures suggest that the average is bolstered by smaller firms and that representation of ethnic minorities amongst partners of the Big Four is even lower.
Way said: “The story is quite different for both women and ethnic minority groups being underrepresented at the top of the accountancy profession.
“Our research informs us that 15% of permanent male accountants work more than 50 hours per week, whilst only 6.6% of women do. Whether this is down to women balancing work with other commitments, such as family, more than men do, or because they are restricted from gaining access to the most senior roles, which may demand longer hours, is unclear. Perhaps there’s less appetite to climb the ladder from female accountants, although I know dozens of ambitious female exceptions, but I suspect some companies may be losing out on talent by not creating a culture at the top which is equally magnetic for both genders. What is clear is that women are under-represented the higher you go up the food chain in the profession.
“The jury is still out on the extent to which the prevalence of traditional ‘old boys’ networks’ high up in the corporate world deters ethnic minorities from breaking into the upper echelons of the accounting profession. We welcome the rise of diversity programmes such as PricewaterhouseCoopers Diversity and Inclusion Strategy, which are welcome steps towards ensuring fair representation, and we will see over the course of the next few years whether these will redress the balance at the top.”
