Accounting for Diversity

How accounting firm Ernst & Young works with academia to promote diversity not just within its own ranks, but within all of business.
Accounting for Diversity

Universities and businesses often join forces to develop initiatives to encourage more diversity among new graduates. For the past six years, Ernst & Young (EY) has hosted two concurrent events designed to support this goal: the Campus Diversity and Inclusiveness Roundtable, where faculty and executives discuss best practices; and Discover EY, an all-expenses-paid event where 150 sophomores and juniors from U.S. schools take part in team-building exercises, leadership seminars, and networking opportunities. These students also are eligible to interview for EY internships.

In 2014, EY planned to hire nearly 12,000 people in the U.S. alone, and it wants to ensure those new hires represent a range of backgrounds and are comfortable working with people different from themselves, says Nancy Altobello, vice chair of talent for EY Americas. Through the Roundtable and Discover EY, she says, the company “seeks to raise awareness of the accounting and finance profession and open doors for high-achieving talent.”

CALL TO ACTION

Roundtable attendees hear from EY leaders—including Mark Weinberger, EY’s Global Chairman and CEO—on the business imperative for developing diverse student communities at their institutions. This past January, 25 professors and administrators from more than 20 undergraduate business programs also shared best practices on driving diversity and improving graduation rates among underrepresented minority students.

Past presenters have included Mansour Javidan, dean of research, Garvin Distinguished Professor, and director of the Global Mindset Institute at the Thunderbird School of Global Management in Glendale, Arizona. He has developed insights into diversity largely through research into what it means to have a “Global Mindset.”

To have global mindsets, says Javidan, leaders must have high levels of capability in three areas: intellectual capital, or their knowledge of global strategy; psychological capital, or their willingness to work with a diverse range of people; and social capital, or their ability to work with and emotionally connect to people different from themselves. Based on his research, Javidan has designed the Global Mindset Inventory (GMI) questionnaire. Organizations like EY often use the GMI to help managers improve their global mindset profiles; business schools can use it to assess students’ global mindsets before and after global business courses and study abroad experiences.

“It’s much easier and less expensive for students to develop global mindsets before they graduate, than it is to try to instill these skills in them when they’re in their 30s,” says Javidan. “Companies are telling us that this isn’t just something that’s nice for accounting departments to do. It’s urgent.”

BEHAVIORAL SHIFT

EY Roundtable presenters also have included Tom White, associate professor, emeritus, at the College of William and Mary’s Mason School of Business in Williamsburg, Virginia. In January 2013, White discussed how his school addresses diversity in “Developing a Global Mindset,” a master’s-level course based on Javidan’s methodology.

In 2012, for example, 13 students in the course took a 13-day cruise through several locations in South America, including ports in Mexico, Costa Rica, Colombia, and the Grand Cayman Islands. They also passed through the Panama Canal. While on board, students took courses on the history, economy, and culture of their next port of call. The goal for the trip—and the course as a whole—was for students to identify and overcome their biases and open their minds to new perspectives. “We created this course to address a skills gap between what traditional accounting curricula teach and what today’s organizations need,” says White.

Another professor inspired by EY roundtable discussions is Jana Raedy, associate professor, associate dean of the master of accounting program, and the Ernst & Young Scholar in Accounting at the University of North Carolina’s Kenan-Flagler Business School in Chapel Hill. She created the MBA course “Leadership: Professionalism and Team Building in Today’s Diverse Business Environment,” with the help of funding from EY. The course incorporates workshops on improving professional communication, building teams, developing soft skills as other majors might be. We start the week before the semester begins, so they can use these skills throughout the year.”

INTEGRATED APPROACH

Raedy and many other roundtable attendees believe that the accounting profession can’t survive without doing more to take diversity into account. “We didn’t have this mindset when I was in accounting practice 20 years ago, but we don’t have a choice anymore,” Raedy says. “It’s not enough for accountants to know debits and credits. They must also be able to work on teams with people from India, China, or Brazil. Accounting has become a profession of communicators.”

Javidan agrees that it takes more than a single course to address issues of diversity. “Business schools have to design experiences, opportunities, and interventions that run throughout a student’s entire accounting education,” he says. “They must take integrative approaches.”

The biggest accounting firms need employees at all levels who have received true diversity training one way or another, says Ken Bouyer, director of inclusiveness for EY Americas. Diversity training at the college and university level, he says, “has a ripple effect not only in schools, but in the broader business community, including diversity of senior leadership and corporate boards.” If one school doesn’t provide graduates with that training, the major accounting firms might find—or help create—the programs that do.

For more information on the Global Mindset Inventory, visit www.globalmindset.com.