Increasing Diversity: How One Firm is Proceeding
Increasing diversity has been on the minds of many accounting firm leaders, but professionals still have questions about how to achieve D&I. AccountingWEB contributor Jeffrey McKinney interviewed personnel at accounting firm Kreischer Miller to learn more about their challenges and what steps they are taking to achieve greater diversity.
Accounting firms not applying or enhancing their diversity practices are taking a big risk in their ability to recruit people of color and gain a competitive edge over rivals.
The failure to engage and nurture a qualified pipeline of talent that includes underrepresented backgrounds could certainly inhibit accounting firms’ future success, says Kristin Seeger, a CPA and director of talent acquisition at Kreischer Miller in Horsham, Pennsylvania.
This accounting firm is now taking bold steps to beef up its diversity program. It is among a growing number of American businesses changing their diversity, equality and inclusion (DE&I) practices. In fact, an increasing number of businesses – including accounting firms – are now more compelled to do so following George Floyd’s death the Black Lives Matter movement.
Still, more needs to be done. Many U.S. employees report they have not noticed changes in their company's diversity this year, despite higher attention to the perks of DE&I. Workers want extra diversity to learn more from co-workers, boost creativity and provide a larger sense of belonging at the job.
Kreischer Miller’s diversity journey largely started after the America Institute of Certified Public Accountants (AICPA) produced a video based on research by James Johnson, Jr., a business professor at the University of North Carolina. The video on changing population demographics impacting the future of America was presented at the Pennsylvania Institute of Certified Public Accountants’ (PICPA) annual Leadership Conference in 2014. Seeger says several team members and herself were present. The video was shared at her firm’s annual meeting. “This really helped build an awareness of the future impact of current trends and helped open all of our eyes to the importance of focusing more on diversity and inclusion.”
In 2017, Kreischer Miller was one of two firms in Pennsylvania selected for the PICPA’s diversity pilot program. Utilizing those resources and doing active research itself, Seeger says her firm began having more conversations about diversity and inclusion. In 2018, Kreischer Miller was one of five U.S. firms picked to sponsor the AICPA’s Inaugural PCPS Internship & George Willie Scholarship Program. “Our participation with the PICPA and the AICPA led to changes in our recruiting and retention strategies and had us address diversity and inclusion efforts much more openly.”
Seeger says her firm has continued to make steady progress with changes to recruitment strategies over the past several years. “We are in the midst of a fresh review of our overall DEI programs, which includes the engagement of an outside DEI consultant, and expect to adopt a refined strategy by the end of the year.”
About the Firm
Kreischer Miller is the largest independently owned firm in the Greater Philadelphia area, Seeger says. It has about 200 team members within five service areas: Audit and Accounting, Tax Strategies, Business Advisory, Technology Solutions and Human Capital Resources. The firm specializes in serving closely held businesses and their owners in various industries, including distribution, manufacturing, construction, real estate, government contracting, professional services and investment firms. Seeger's duties include ensuring that the firm is well positioned as the employer of choice. Her main job is developing relationships with experienced professionals and students for potential positions within the firm. She also leads Kreischer Miller’s Diversity, Equity, and Inclusion Council.
Where is the Firm Now?
Seeger says while there is a good deal of gender diversity at all levels at the firm, like most firms, Kreischer Miller is actively looking to build more ethnic diversity. She says the firm has already implemented changes to its recruiting and retention efforts to help it achieve that goal. For example, it has created new partnerships with professional affinity organizations, such as NABA, Ascend and ALPFA, so it can network. The firm expanded its target schools to include HBCUs and those with more diverse student bodies. It has also offered unconscious bias training and plans to expand DEI-specific educational offerings.
However, Seeger says while progress has been made, much needs to be done. As such, the firm is working with an outside DEI consultant to help create a long-term strategic plan. Seeger says the first step the firm is taking requires performing a full audit of the organization related to diversity. That includes looking at its current recruitment, personnel, promotion, retention and marketing practices. “I have no doubt that this will be an iterative process, because all companies that have adopted DEI initiatives understand that we are all continuing to learn and evolve.”
In a competitive field, such as public accounting, retaining top talent continues to be an important priority. The firm is constantly evaluating its retention and development strategies. Seeger says it leverages internal and external sources for development and looks for meaningful ways to retain team members beyond run-of-the-mill concepts. Further, the firm is refining its mentoring and coaching programs to ensure they provide maximum support for diverse team members. "The challenges that face our colleagues of color are uniquely different. It is important to provide them with the guidance, support, and resources they need to succeed even if that means turning to mentors and sponsors outside of our four walls," Seeger says.
How Due Diligence Helps Identify Diversity Areas to Focus On
Seeger reiterated the firm has made numerous adjustments to recruiting efforts to increase DEI and will continue to do so. She added development and retention have also been primary areas of focus because the firm wants to ensure it is providing underrepresented team members with a path to leadership. To that end, she says the firm also formed an employee resource group focused on the development of female leaders. Further, the firm is looking into the establishment of similar groups for other underrepresented team members. On the compensation front, for the past several years, the firm has “performed a compensation study to ensure equitable compensation and w[as] happy to find that we had no disparities in race or gender.”
Other Areas to Improve
Seeger says the firm needs to work with organizations like the AICPA and PICPA to build a more racially diverse pipeline of candidates at the college level. “That continues to be a challenge in our profession, and only when we see progress on that front will we have a profession that looks more like the country we live in.”
She went on to say, “Both our firm and the profession as a whole have made progress in increasing gender diversity in general, but we need to do more to develop and retain females so we can achieve more gender diversity in leadership roles.” Through research, she says her firm has also identified new metrics that will be important to track to evaluate its progress and identify the need for new strategies.
How the Firm is Benefitting from AIMM
For those not aware of the AICPA’s Accounting Inclusion Maturity Model (AIMM), Seeger highly recommends using the tool. It is free for members and measures four key areas: Workplace Culture, Workforce (People), Marketplace (Clients), and Suppliers and Community.
As for results at Kreischer Miller, Seeger says she was incredibly pleased that it showed the firm has been intentional in its efforts regarding Workplace Culture and Workforce. But, building a diverse and inclusive team is a journey. “While we are expanding beyond being an early adopter and building upon leading practices, we are still striving to do even better. The assessment helped highlight that we could build more awareness in our marketing efforts and the engagement of suppliers and clients. We will incorporate this as we finalize our long-term strategic plan, measure our performance, and continue our journey.”
Seeger says the initial challenges were wanting to do so much but not being sure where to start and knowing there is an expectation to demonstrate to your own people that you are taking action. Further, she added, there is the importance of expressing your intentions without creating any misunderstanding.
"This is a very emotionally charged topic, so starting a potentially uncomfortable conversation creates anxiety." She says there are an infinite number of articles and books to read, webinars to participate in, and discussions to have. "Patience and understanding by all parties are paramount to success, but being patient is hard to do when you want to jump right in immediately," she says. "But it is important to take the time to create a solid plan so that you are doing things that are effective for the long term and not just window dressing."
How Being More Aggressive Offers Better Results
By 2025, 75 percent of the global workforce will be made up of millennials, who have a much different perspective on diversity than prior generations.
While older generations tend to view diversity through the lenses of race, demographics, equality and representation, millennials see it as a melding of varying experiences, different backgrounds and individual perspectives. If businesses are looking to hire and sustain a millennial workforce, diversity must be a key part of the company culture.
Also, companies in the top quartile for ethnic cultural diversity on executive teams are 33 percent more likely to have industry-leading profitability, 45 percent more likely to report a growth in market shares over the previous year, and 70 percent more likely to capture a new market. "Thus, not only does focusing on diversity help further team engagement and retention of our team members, but it will foster innovation and creativity, thereby giving us a competitive advantage," Seeger says.
And, studies show that by 2055, there will no longer be a majority race in the United States. Seeger says that is a very powerful statistic. "If companies haven’t been considering the impact of diversity on their business by now, it is imperative that they get started!"
Seeger says the firm will continue to incorporate the changes it has made to date as it proceeds through the fall. The final step is completing an internal audit and finalizing an action plan. She says as accountants, “we are well aware of the need to do proper due diligence so we can be deliberate in our actions and avoid any unintended consequences.” The amount of time it takes for implementation is really determined by those processes being completed properly.