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November 27, 2022

PwC’s Transparency Gives Its Employees the Warm Fuzzies

Yesterday we discussed the Vault business outlook rankings for public accounting firms. In general, I thought that mid-tier firms have a sunnier horizon than the Big 4 firms, with the obvious exception of PwC. That exception seemed odd to me, so I shot a question over to Derek Loosvelt who did the write-up on the Accounting 50. Here's a portion of what he told me:

[I]nsiders at regional firms typically believe their firms (their management) to be very transparent with respect to strategy and financials and outlook. But at larger firms, there hasn't been that transparency, historically speaking. However, at PwC lately, there seems to have been a push to become more transparent (like the smaller firms), and maybe that's working.

That got me to thinking about transparency and how it's one of those buzzy corporate philosophies that people have really latched on to. In theory it seems like a good thing, but it also seems like it has become a strategic marketing ploy. Putting cynicism aside for a second — how "transparent" are public accounting firms, really? Well, for internal purposes, Loosvelt's point is well taken — the leadership in regional public accounting firms isn't as distant from their employees, thus these employees get the sense that they have a better understanding of things like strategy and outlook at their firms. And that message they receive is certainly not as polished as the one crafted by the wordsmiths working for the Big 4, giving it a more genuine tone.  

And I think Loosvelt is right — PwC seems to have recognized that. Vault's various "Best to Work For" lists don't include a "Communication" or "Transparency" ranking but some quotes he shared with us indicate that PwC would probably score high in that too:

"Leadership communications on outlook are very straightforward/transparent. Several initiatives are communicated and discussed to strengthen the firm's market position for services and recruitment."
"Our leadership is in continual contact with employees. They are transparent in sharing our goals, business outlook, strategies, and expectations."
"Our chairman has the entire organization engaged in the strategy. Bob Moritz is transparent and genuine. He's a unique thinker and really challenges the status quo. He's open to being challenged as well. It's impressive. The firm has made some smart decisions that were very intentional and strategic. I've watched competitors try to 'copy' us, but they don't seem to be acting with intention, but rather reacting."
I suppose there's some truth to this. Back in 2011, "Transparency" was a major part of the changes implemented to its compensation structure. So maybe a couple of years after that, it is starting to have the intended effect on employees. I mean, telling employees that we're going to be more open with you about the money you make is a pretty easy way to win points with employees. If they're using the same approach with results and business outlook, that makes people feel included rather than some cog in a wheel
Call it "transparency" or call it "internal marketing," PwC's approach seems to be working and for a firm of their size, that's extremely important. You may not give the Vault rankings that much credence, but the results do make for a nice recruiting message, and that's where this whole process begins.

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