• PwC’s Recruiting Will Take a Hit Over the Oscars Debacle

    By | March 1, 2017

    Forty-two years ago I sat down to make an important life decision, my second in two years.  The first was to go to graduate school instead of accepting a commission in the Marine Corps. The second was to join Price Waterhouse. Marriage would come later.

    I was the first in my family to go to college. I did well, and was aggressively recruited by the then-Big Eight and a few more firms. My final decision was between Price Waterhouse, now PwC, and McGladrey Hendrickson, now RSM. Arthur Andersen, which had developed a business model chasing blue-collar kids like me, came in third.

    Like many students, I sought the advice of trusted professors. They told me that PW was the hardest firm in which to make partner, but that only increased the stature of the firm for me. My final decision to choose PW was based on the silliest of reasons. Because PW did the Oscars, my mother knew who they were, while my family knew nothing about the other firms.

    There’s been a fair amount written about the brand damage that the firm will suffer, but I will reiterate: PwC has seriously damaged its brand with the Oscars fiasco. They won’t lose many clients over it; I doubt they’ll even lose the Oscars. Brian Cullinan has been humiliated, but will not be fired.

    But somewhere tonight or tomorrow or next fall, some talented blue-collar kid is going to choose another firm and that is where the real damage will be done.

    Paul Gillis PhD CPA, is a retired PwC partner who is currently a Professor at Peking University

    Image: iStock/AntonioGuillem

    • N.E.R.D.

      That’s why high associate churn is built into the business model! It’s a design feature, not a design flaw.

      Most recruits aren’t going to stay long anyway.

      • Big4Veteran

        Why do associates go to a Big 4 firm in the first place? And why is it their plan to leave after only a few years? Because, besides for the CPA experience needed, they are getting a brand name to put on their resume which will be with them for the rest of their career.

        A Big 4 accounting firm provides a pedigree, much like a big name school provides a pedigree. If you went to a big name school or worked at a Big 4 firm, you know this (or should know this). If you didn’t, then you are misinformed and/or jealous.

        • N.E.R.D.

          Next year PWC will have it’s pick of the top students again – the feature of churn.

          They *might* miss out on 1 year – oh well. This ain’t AA/Enron and the collapse of a firm. This is a social media gaffe that we’ll laugh about on forums like we do about Scott London.

          Oh, I read your other post after I responded. You said the same thing. I just don’t think it’ll have much lasting effect, and the effect on PWC’s pedigree is immaterial.

          • Commando

            Good point. What is it about LA managing partners that they are all such losers?

            • cpanum31

              L.A., especially the entertainment sector, is and always has been different than most other cities in the Country. Lot of temptations there to get one off the straight and narrow. Since the Studio System collapsed, most of the really juicy bits have leaked out.

        • LeftShark Consultant

          Why do they go Big 4? Because they’re wide eyed college kids- with very little knowledge of how anything in business works. All they know is that accounting professors, the career center and going concern pump them with the Big 4 kool-aid . The perception of the Big 4 isn’t going to change. The people that want to go Big 4 and are accepted into the Big 4 aren’t going to change because someone handed someone the wrong envelope. (Especially considering most people will be applying to offices outside of LA).Those who wanted to go Big 4 but weren’t good enough will go to the GT types.

          There are much bigger accounting scandals related to the Big 4- and people are still applying to the Big 4.

    • Big4Veteran

      I totally agree with this article. I had the same experience when learning about the Big 6 (at the time) when I was in college. I think the only firm I had even heard of when I decided to major in accounting was Price Waterhouse, and I had only heard of them because of the Oscars. Price Waterhouse was the only firm my parents (neither of which were accountants) had heard of as well. None of us even knew there was such a thing as the “Big 6” before I started to study accounting.

      I agree that PwC’s brand has been damaged, but they will not lose any clients over this (except, possibly, the Academy). But the firm is going to be a punchline for a while, which is NOT good for a brand that’s supposedly built upon integrity, trust and accuracy.

      • accountingforlove

        Before my ill-fated decision to major in accounting, the only firm I’d heard of was Price Waterhouse, and that was only because of The Naked Gun 33 1/3: The Final Insult.

        RIP, Leslie Nielsen and George Kennedy.

    • RFLBM

      So far none of the summer leadership candidates I’ve talked to have brought this up, but I’m curious to see how it plays out as the recruiting cycle continues.

      • Commando

        Nobody will say that this is the reason they go to another firm. They will just choose another firm and PwC’s entry class will be weaker.

        • RFLBM

          Because the candidates that would choose another firm over this incident are so much stronger?

          Please. Unless they’re going to the LA office and want to work on media/entertainment clients, that’s kind of a frivolous reason to dismiss a firm.

          • Commando

            Many students reach a dead heat between firms – after all there really is no difference between Big Fours. Something has to tilt the scale.

    • KM

      PwC is really going to miss that handful of recruits that choose another firm cause of the Oscars. How will they ever survive?

      • cpanum31

        I agree.
        It is the big picture that counts, not this tiny incident with one firm employee.

    • sludgemonkey

      Does the nominal fee that PWc charges for their work render them no longer independent as it relates to this client? After all, they are doing the work for the exposure it appears, not the money. Is that ethical? It’s not a charity…..that is a different decision altogether unless you promote your auditing in the press.

      • Commando

        Valid issue. Write the California State Board of Accountancy.

        • sludgemonkey

          You mean they aren’y monitoring GoingConcern?

    • The Horniest Partner

      Got-dam how many names has McGladery gone thru? Never heard of McGladry-Hendrickson.

      • Big4Veteran

        You can put lipstick on a pig…but its still a pig.

      • cpanum31

        Pre 1987 name before one of the later mergers or acquisitions.

    • Eric Burgess

      People won’t look at the Oscar mishap at such a granular level, especially millenials. To 99.9% of the people that watched and/or heard about the debacle, the only thing they’re going to remember is the Oscar flub itself. Most non-accountants don’t even know who PwC is, or really care for that matter.

    • McValue Meal Audit

      Did you just call a PWC prospect, “blue collar”?

    • McValue Meal Audit

      I don’t think it will have any effect on recruiting.

    • Sammy K

      I sincerely hope so. That firm has it’s head so far up it’s own ass that they think anything they touch turns to gold. Happy to see you fail.

    • Stephen the first

      Why use partners for this gig? It seems like a mismatch with the skill set of a 57 year old champion schmoozer and salesman. PWC must have any number of hard-assed managers that would take care of this business and not get distracted and not freeze up in an emergency.

      It was PWC’s job to staff this engagement correctly, and they failed. This is going to haunt them.

      • Commando

        It has always been the managing partner of LA. It is the big perk of the job – getting to stand on the Oscar’s stage.

        • cpanum31

          Yep, only had to do one task, and he screwed the pooch (classic line from The Right Stuff.)
          I see other people were catching him on their videos back stage, and there he is playing with his cell phone instead of doing his one task.

          I have not yet heard what the Academy wants to do. I read they are not happy.

    • Andrew Y

      I completely disagree with this article. Their brand will be fine. People who want to work in the Big 4 will still be very impressed when they take office visits. The comp will still be solid, the benefits still decent and they have tremendous clients. In a few weeks this will be a non story. There may be some jokes here and there, but the public has very short memories.

      People just elected a President and nothing he said or did damaged his brand in the eyes of his supporters. Nothing pwc did even comes close to “grab them in the”. case closed.

      I do work in the Big 4, but not for pwc.