CEO Compass - Fall 2021

by Ralph Albert Thomas, CPA (DC), CGMA | NJCPA CEO and Executive Director | October 6, 2021

Diversifying the CPA Profession — It Takes a Village

In a recent episode of the NJCPA IssuesWatch podcast, “Black CPAs: Honoring the Past and Building the Future,” Don Meyer, the Society’s chief marketing officer, interviewed Crystal Cooke, the director of diversity and inclusion at the American Institute of CPAs (AICPA), about the Black CPA Centennial celebration and what firms and individuals can do to enhance the recruitment and advancement of Black CPAs.

In response to a question about what advice she would offer to Black prospective CPAs, Crystal responded, “We need you! It’s not advice, but we need you.” Crystal’s response struck me as apropos on two levels. First, for decades, the accounting profession has pursued diversity, equity and inclusion (DEI) initiatives to create opportunities for all to feel welcome, valued and critical to serving the public interest. Yet, progress is inconsistent at best.

There are more than 500,000 licensed CPAs in the United States, but only 2 percent are Black. Unfortunately, diversity in the CPA profession has changed very little in the last 25 years. According to the AICPA, minority hiring in the profession has seen slight improvements but overall stagnation.

Second, in tandem with the profession’s diversity challenges, we are witnessing a nationwide decline in not just new CPAs but also accounting program enrollments. According to the most recent AICPA Trends Report published in 2019 — a comprehensive biennial report tracking the supply and demand of U.S. accounting graduates — projected bachelor’s, master’s and Ph.D. accounting enrollments were down 4 percent, 6 percent and 23 percent in 2018, respectively, and the number of new CPA Exam candidates hit a 10-year low.

To be blunt, the profession has a pipeline problem. 

According to a research report from the Institute of Management Accountants (IMA) and the California Society of CPAs (CalCPA), “Diversifying U.S. Accounting Talent: A Critical Imperative to Achieve Transformational Outcomes,” in order for the profession to continue to grow and succeed with a robust talent pipeline, actions to address DEI issues need to be taken now. This includes bringing in and promoting talented people based on relevant and unbiased factors rather than demographics.

Although the research highlights the stark reality facing the profession today, it also presents a great opportunity.

“If we collaboratively work to close the diversity gap, it will not only have a positive impact on the front-end pipeline of candidates coming into the profession, it will work to curb the loss of talent that we are seeing,” said Brad Monterio, CalCPA chief learning officer. 

However, reversing the CPA credential’s downward growth trajectory will not be without its challenges. The race for relevance is faster and more competitive than ever. Our hope is that by addressing these challenges now we can help all stakeholders ensure the profession’s sustainability and relevance for many generations to come.

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