Post image via Here’s the Deck EY Put Together to Sell the Audit/Consulting Split to Staff
It was only days ago that EY released its Empathy in Business Survey results for 2023 and if you remember, the last time they promoted empathy in business it did not go well. Recap on that from last year:
You can skip the click, this one post sums up the firm’s snafu:
See, they rolled this out weeks after EYers found out they would not be getting discretionary mid-year bonuses, making for a plethora of “can I pay my rent in empathy” jokes across the usual channels.
Here we are a year later and once again EY’s empathy propaganda could not have been released at a worse time. The survey results press release went out on March 30, days before Project Everest failed but months after the firm implemented numerous belt-tightening measures ahead of the split such as travel limits, quiet hiring freezes, and possibly some secret layoffs through indiscriminate use of PIPs on previously high-rated performers. And that’s just the stuff we know about. Days after the news broke that audit and consulting would not be split due to internal strife and an inability to work out big kinks like funding pensions, EY said it was cutting 5% of its workforce. But not because the failed split cost half a billion dollars, rather the firm credited current economic conditions, strong employee retention rates and overcapacity. Phrased another way: a shitty economy (true), too many people sticking around (x), and too many people on the bench. EYers will have to tell us if that last one is true.
Anyway, the survey. With the layoff news yesterday it might be even worse timing than last year.
The majority (86%) of employees believe empathetic leadership boosts morale while 87% of employees say empathy is essential to fostering an inclusive environment.
As many employees face downsizings, restructurings and a looming global recession, most say that empathic leadership is a desired attribute but feel it can be disingenuous when not paired with action, according to the 2023 Ernst & Young LLP (EY US) Empathy in Business Survey.
The study of more than 1,000 employed US workers examines how empathy affects leaders, employees, and operations in the workplace. The survey follows the initial EY Consulting analysis of empathy in 2021 and finds workers feel that mutual empathy between company leaders and employees leads to increased efficiency (88%), creativity (87%), job satisfaction (87%), idea sharing (86%), innovation (85%) and even company revenue (83%).
“A transformation’s success or failure is rooted in human emotions, and this research spotlights just how critical empathy is in leadership,” said Raj Sharma, EY Americas Consulting Vice Chair. “Recent years taught us that leading with empathy is a soft and powerful trait that helps empower employers and employees to collaborate better, and ultimately create a culture of accountability.”
“Time and again we have found through our research that in order for businesses to successfully transform, they must put humans at the center with empathetic leadership to create transparency and provide employees with psychological safety,” said Kim Billeter, EY Americas People Advisory Services Leader. “Empathy is a powerful force that must be embedded organically into every aspect of an organization, otherwise the inconsistency has a dramatic impact on the overall culture and authenticity of an organization.”
Y’all, EYers have been cagey ever since the split was announced last summer. Countless soon-to-be graduates posted frantic Reddit posts asking what the split might mean for them and if they should take a different offer instead. Retired partners came out of the woodwork to question leadership’s motivations for a split. Current employees, still butthurt about the bonus thing, understood all too well that a liberated consulting arm would require buckets of capital to get off the ground which means stingier raises and bonuses. All delivered with some ambiguous promise that IF circumstances conspired to make the consulting business successful, that success would trickle down to the grunts. The grunts in consulting, that is. Audit was always going to get screwed in this deal.
I think it’s safe to say that EY leadership needs to take their own advice. It brings to mind this quote from Shakespeare’s The Merchant of Venice: “If to do were as easy as to know what were good to do, chapels had been churches and poor men’s cottages princes’ palaces. It is a good divine that follows his own instructions: I can easier teach twenty what were good to be done, than be one of the twenty to follow mine own teaching.”
