PwC and KPMG are falling behind rivals EY and Deloitte in promoting women to run the most prestigious audits in corporate America, new data shows.
Women still only account for 20 per cent of the lead engagement partners on audits of S&P 500 companies, according to a study published on Tuesday by the CFA Institute, the professional body for the investment industry.
The figure, covering audits from 2021, represented an improvement from 15 per cent four years earlier but showed the need for faster progress at some firms in particular, said Sandy Peters, head of global advocacy at the institute.
“Half of those entering the accounting profession are women,” Peters wrote in the study. “The issue in Big Four firms is leakage from the pipeline. Within 10 to 15 years — the time it takes to become a partner — the near-majority of women in accounting turns into a minority.”
Women run more major audits at each of the firms than they did four years earlier, and the number of S&P 500 companies with female lead engagement partners rose from 73 to 102 in total, the CFA Institute found.
Deloitte led the Big Four with women making up 27 per cent of its S&P 500 lead engagement partners. Meanwhile EY showed the largest increase — from 13 per cent in 2017 to 22 per cent in 2021.
KPMG remained in fourth place with 13 per cent of their S&P 500 engagement partners. The pace of growth was slowest at PwC, which slipped to third place with 19 per cent.
KPMG said it had mentorship and development programmes specifically to help women advance to lead engagement partner, and the CFA Institute study ignores its broader progress.
“This one metric obscures our progress in advancing women in leadership across our business,” KPMG said. “In audit, we have increased the number of female partners by more than 10 per cent since 2019 with women in more than 30 per cent of leadership positions today.”
PwC said it was working to increase the diversity of partners running significant client relationships, in audit and elsewhere in the firm. “While we are not where we want to be, we are proud of the progress we’ve made,” the firm said.
Peters, herself a former audit partner at KPMG, said that the Big Four offered “a good training ground” for future company chief financial officers, controllers and audit committee members, so improvements there could contribute to gender progress in the boardroom.
“Lead engagement partners participate in audit committees of the board each quarter and interact with upper management,” she wrote. “If diversity of decision making is important to investors in the boardroom, auditors are just an extension of that interest.”
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