Inclusion in accounting: By the numbers

November 26, 2023 10:06 PM

The accounting profession is suffering from serious talent shortages, caused by both a slowing pipeline of entry-level accountants and the ongoing leakage of experienced professionals to other industries or to retirement. And yet firms remain slow to grasp the value of diversity, equity and inclusion initiatives for tapping new sources of talent and boosting retention rates.

For instance, less than half of respondents to a recent survey conducted by Accounting Today and Arizent Research think it's important for their firm to evaluate its progress on DEI. (The survey was part of a wider research effort involving a number of finance and related industries; you can see the full report here.)

Nonetheless, there are some signs of improvement, and a number of initiatives that firms are taking to boost DEI specifically, and to make their workplaces less toxic, as you can see in the data points below.

Diversity, equity and inclusion are not yet universally recognized as important areas for firms to focus on: Almost a fifth of respondents (24%) are indifferent to it, and almost a third (30%) think it's somewhere between "somewhat unimportant" and "completely unimportant."

AT-112523-DEI- Importance of DEI from year to year

There has been progress, however — of a sort: The percentage of respondents who think DEI is unimportant declined significantly from 2022; far more are merely indifferent to it in 2023.

One driver of those attitudes may be that many respondents feel their firms are already pretty healthy when it comes to DEI. (Spoiler alert: They are most probably not; a host of studies have shown that the profession is woefully lacking when it comes to diversity, with the overwhelming majority of accountants being white, and the majority of firm leaders being white men.)

AT-112523-DEI- Demographics represented in teams

For example, consider the fact that just over 80% of accountants reported having five or fewer demographic groups — meaning different races, genders, generations, sexual orientations, etc. — on their teams.

AT-112523-DEI- Demographics represented in leadership

And things are even worse among the leadership of firms, with 95% having five or fewer demographic groups — while almost a fifth (18%) are entirely homogeneous.

It's worth noting, though, that in terms of commitment to inclusion, accounting firms are not too far out of line with a number of related industries, such as banking, financial planning, insurance and the mortgage industry.

And some firms are taking steps to boost DEI, particularly in terms of looking at their pay and promotion structures — initiatives that can also help with some of the profession's broader issues in recruiting and retention.

In terms of broader workplace toxicity, accountants are somewhat less likely than the broader set of comparison industries to score as "healthy" (21% versus 32%), and somewhat more likely to score as "unhealthy" (22% versus 15%).

That may mean those other professions are simply healthier; on a number of measures, the responding accountants were more likely to report positive things about their work environments.

Meanwhile, the top-rated negative comment, "'Work-related stress negatively impacts my relationships with people close to me," was only cited by 25% of respondents.