Deloitte invited its fellow Big Four accounting firms to an overdue banquet of consequences last week. David Sproul, Deloitte’s chief executive, revealed that in the past four years the company had fired 20 partners for inappropriate behaviour that included bullying and sexual harassment. Deloitte’s decision to release the figures, which PwC, EY and KPMG’s UK operations felt obliged to follow, is a welcome sign of increased transparency on issues of corporate culture.
More important, it demonstrates a desire to tackle abuse. As vast laboratories of white-collar work, the Big Four ought to be leading the way in rooting out and preventing bullying and harassment, and setting an example to companies in other sectors — many of which are their clients.
More than a year after the #metoo movement raised global awareness of the problem of sexual harassment, places where offenders can hide are dwindling. But some behavioural norms in the workplace have survived even after three decades of sexual harassment policies and procedures. A recent US survey found that 36 per cent of women and 20 per cent of men in consulting and management claimed to have been sexually harassed. More specific and direct action is required to prevent harassment and bullying, and deal with historical cases that firms may have brushed under the carpet.
A second important step is to extend “zero tolerance”, as Deloitte has done, to clients who behave badly towards employees. This is harder to enforce. When the offender has the power to end a large and lucrative contract, professional service firms face tough decisions. But the partial solution of moving a staff member out of harm’s way, rather than calling out unacceptable behaviour with the client, merely allows the offender to do exactly the same with other staff members, as Mr Sproul pointed out.
A third area is regulatory action. The approach of the Financial Reporting Council, the UK’s accounting watchdog, is currently out of step with that of the Financial Conduct Authority, which oversees financial institutions. The FCA takes into account “non-financial conduct” of individuals and has failed some people on the “fit and proper” test for employment in certain key roles. The FRC does not monitor sexual harassment.
The UK parliament’s women and equalities committee was right, in a report this summer, to suggest that the FRC should reinforce accountancy firms’ recent actions. It recommended making clear that sexual harassment and bullying are breaches of professional standards, and reportable offences with sanctions. The Bar Standards Board and the Solicitors Regulation Authority have both taken proactive steps to tackle sexual harassment in the legal profession.
Rooting out bad behaviour is also about making businesses more productive and more profitable over the long term. Bringing more women into upper management has proven benefits. Companies that allow a bad culture to fester will limit the pool of people they can attract, and create invisible barriers to promotion. As Sandie Okoro of the World Bank told the recent Financial Times Women at the Top conference, “how the place feels when women walk into it” can affect whether they want to join.
Ending abuses of workplace power, in all forms, is long overdue. Deloitte and the other accounting firms are taking important steps and publicising their actions. But this still appears a long path to navigate. Making offices more comfortable for all staff ought to be obvious to all concerned.
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