New Report Addresses Need to Diversify U.S. Accounting Talent
The Institute of Management Accountants (IMA) and the California Society of CPAs (CalCPA) have released groundbreaking research findings in their joint study, “Diversifying U.S. Accounting Talent: A Critical Imperative to Achieve Transformational Outcomes.”
This diversity, equity and inclusion (DE&I) research study examines three demographic focus areas: race and ethnicity, gender and LGBTQIA (lesbian, gay, bisexual, transgender, queer, intersex and asexual) orientation in the U.S. accounting profession, encompassing public accounting and management accounting (accountants and financial professionals in business). The study also examines the role of ethics in the profession’s overall progress around DE&I and presents solutions to drive expansive change.
The first in a multi-part global series, this report is informed by results from an online survey of over 3,000 current and former U.S. accounting and finance professionals and interviews of nearly 60 accounting, human resources and DE&I practitioners and academics. The study found that there is a significant diversity gap between those in executive leadership ranks and the broader accounting profession as well as the U.S. population. For example, African Americans make up 8.5 percent of the profession but only 1 percent of partners at U.S. CPA firms and 1.5 percent of CFOs of Fortune 500 and S&P 500 companies. The survey revealed diverse talent believes they aren’t advancing in the profession because of a lack of equity and inclusion.
“Although our research highlights the stark reality facing the profession today, it also presents a great opportunity,” said Jeff Thomson, CMA, CSCA, CAE, IMA president and CEO. “Members of our profession are telling us that the only way to overcome today’s DE&I challenges is to collaborate to enact meaningful change, and collective action needs to be taken now.”
The study found that 43 percent to 55 percent of respondents from groups underrepresented at senior levels left their employers due to a perceived lack of equitable treatment, and at least 30 percent have left because of a lack of inclusion. The lack of DE&I poses risks to the success of the profession’s transformation currently underway. As many as 18 percent of the respondents from diverse demographic groups left the profession altogether due to these factors.
“The diversity gap between senior leadership and the broader accounting profession is a huge wake-up call that this needs to be fixed through real solutions,” said Anthony Pugliese, CPA, CGMA, CITP, CalCPA president and CEO. “More diverse leaders are needed to connect people of all backgrounds to the profession and to serve as role models so we can retain and develop the next generation of talent.”
The study concluded that for the profession to continue to grow and succeed with a robust talent pipeline, actions to address DE&I issues need to be taken now. This includes bringing in and promoting talented people based on relevant and unbiased factors rather than demographics.
“This report gives a voice to members of the profession by presenting their contemporary experiences and is meant to heighten awareness and inspire change at all levels,” said Loreal Jiles, IMA Director of Research and lead researcher on this project.
The report acknowledges DE&I improvement efforts that are already underway and suggests action in four areas: awareness, attraction, promotion and accountability.
“If we collaboratively work to close the diversity gap, it will not only have a positive impact on the front-end pipeline of candidates coming into the profession, it will work to curb the loss of talent that we are seeing,” said Brad Monterio, CalCPA Chief Learning Officer and CalCPA research lead on this project.
Several partners worked with IMA and CalCPA on this research study, including The International Federation of Accountants (IFAC), National Association of Black Accountants (NABA), Association of Latino Professionals for America (ALPFA), National Society of Black CPAs (NSBCPA), PhD Project, Connecticut Society of CPAs, Colorado Society of CPAs, Florida Institute of CPAs, Illinois CPA Society, Maryland Association of CPAs, Massachusetts Society of CPAs, The Ohio Society of CPAs, Pennsylvania Institute of CPAs and Texas Society of CPAs.