Deloitte is appointing a new Chairman and CEO of its audit subsidiary, Deloitte & Touche, and the new man in charge is actually an old man in charge - Greg Weaver. He led D&T from 2001 to 2005 and with this triumphant return to big chair, this basically making him the Grover Cleveland of the Green Dot.
Just a thought - Weaver Administration 2.0 has to be raising eyebrows inside the firm. One tipster sent us the following message, "I am very surprised that he is the choice, because many of the quality issues are embedded from those days." Our source also pointed to this quote from Weaver that was in a 2004 Wall Street Journal article, "Behind a Wave of Corporate Fraud: How an Audit Works" penned by Jonathan Weil:
"It would really be negligent" not to take a risk-based approach [to audits], says Greg Weaver, head of Deloitte & Touche LLP's U.S. audit practice. Auditors need to "understand the areas that are likely to be more subject to error," he says. "Some might believe that if you cover those high-risk areas, you could do less work in other areas." But, he adds, "I don't think that's been a problem at Deloitte."
After considering the role requirements and the substantive feedback from the surveys and interviews, I am pleased to announce that I have appointed Greg Weaver as the next Chairman and CEO of Deloitte & Touche LLP. Greg clearly emerged as the top candidate, based on the role criteria and his proven leadership. The Board of Directors of Deloitte LLP has approved the appointment.
He echoed this sentiment in today's press release:
"Greg is a natural choice to lead our audit and advisory subsidiary," said Joseph Echevarria, chief executive officer of Deloitte LLP. "His prior experience in this position, in particular, gives him a deep understanding of the most critical aspects of its business and the unique role of the auditor in building trust and protecting the investing public and capital markets. Moreover, Greg's relentless focus on quality, combined with his technical expertise and unwavering integrity, has earned him the respect of his peers inside and outside Deloitte."
We've always known Deloitte to be a lay-it-up type of firm, but this is a safe move that defies logic. This move basically says that the firm is not willing to let any of the younger partners with leadership potential have a shot. Weaver has been with the firm for 38 years, putting him around 60 years of age. The audit business is one that needs fresh blood more than any other and this seems like a phoned-in appointment either to appease a veteran employee or a redistribution of power and control in the firm to someone who won't rock the boat.
But then again, it's possible there isn't a single partner in the entire AERS practice coming up through the ranks that is qualified for this job. Or it's possible that Greg has a secret plan to get the SEC and PCAOB off their back about the whole China situation. OR it's possible that Joe simply owed Greg a favor (e.g. Greg bought Joe's house) and this seemed like nice way to repay that favor.
Whatever the motive, it's pretty clear that Deloitte is leading from the front all right. Right through the past.