When Diversity Recruitment Backfires: The Paradox of Losing the People Firms Work So Hard to Attract

AICPA data shows the accounting profession is 77% white, 14% Asian, 2% Black and 5% Hispanic or Latino, while 82% of partners are white. In the March issue of INSIDE Public Accounting Monthly, we took a look at how firms may be hurting their own efforts to be more diverse.

Illinois CPA Society leaders are facing the troubling conclusion that firms may be unwittingly undermining their work to increase minority recruitment. A survey intended to help the society improve its programming took a turn when senior director Kari Natale conducted follow-up interviews that brought her to tears.

Natale, who leads the society’s charitable arm, the CPA Endowment Fund of Illinois, developed a scholarship program 11 years ago named for the first Black woman to earn her CPA in 1943 – Chicago native, mentor and firm owner Mary Washington Wylie. Natale says the follow-up to her recent survey showed that alumni of the program were facing barriers not unlike those faced by Wylie herself. “We’re in 2023 now – this is really still happening.”

Survey participants told her about their lack of confidence, compounded by a lack of mentors (or ineffective ones) and acts of what appeared to be deliberate exclusion from the team. “I know everybody feels that way when they start a new job, but it was at a different level here. I had a hard time keeping it professional at some points.”

Instead of using the survey and interviews for internal planning, Natale thought, “This is awful, we need to talk about it and hopefully other people can talk about helping.” The results were published last late year in “Uncovering the Barriers to Success.”

Diversity Without Direction

The report concludes that opening the door to an accounting internship or a job isn’t enough. More diverse hiring doesn’t translate to long-term success (or even short-term success, in some cases) because CPA firms are unintentionally driving diverse hires out of the workplace and possibly out of public accounting altogether.

The survey included 159 scholarship alums, all of whom had held at least one internship or a part-time or full-time job. Some of the comments that got Natale’s attention included:

  • “No one looks like me. It was shocking to realize there’s not one Black female partner in the practice. The lack of representation makes it hard to want to stay.”
  • “The recruiters and interviewers all talked about how much their organization valued diversity, but in just the short time I worked there, there was nothing about the culture that felt inclusive to me.”
  • “It felt like everybody I talked to already knew each other from their fraternities or sororities. It’s like they belonged to an exclusive club I could never be a part of.”
  • “Every time I thought I had a handle on things, my manager gave me negative feedback but no guidance on how to improve. I really liked public accounting, but this cycle made me doubt myself and left me feeling drained.” (This person ultimately left their position in search of a boss who would provide more direction.)

The survey respondents were 54% Black or African American, 36% Hispanic or Latino and 10% from other under-represented groups; 84% were age 30 or under; and while 70% work in public accounting, just half of those expected to stay in public accounting over the long haul.

Three Major Themes Contributing to Disparity

Natale wasn’t surprised to hear that the lack of diversity within firms would be a barrier to success – it was cited by 58% of respondents, more often than any other hindrance. Two other themes emerged from the interviews: Respondents feel handicapped by their backgrounds, and they believe the feedback and development they receive is inadequate.

The survey participants said they felt stigmatized because they attended less competitive accounting programs and had far different personal histories and fewer connections in the business world.

Nearly half (48%) believed their education “did not adequately prepare” or only “somewhat adequately prepared” them for their work. “After graduating and starting my first full-time job, I quickly realized that I didn’t know how much I didn’t know,” one alum said.

“A lot of the leaders don’t want to single out employees, so what I’m seeing is they’re changing recruiting methods for diversity, but then they’re not changing onboarding methods,” Natale says. “Expectations are the same regardless of how they came into the firm.”

And those expectations were not always fully explained. The lack of real-time feedback and effective mentors left the scholarship alums feeling like they had to figure it out on their own. The third most-cited barrier, by 31% of respondents, was “mentorship opportunities not available or inadequate.”

One alum raised a valid question: “Knowing the diversity numbers, why aren’t employers making more of an effort to provide us with the resources we need and mentors who’ll really look out for us and help us through our careers?”

A More Comprehensive Approach

In discussions with firm leaders who have expressed a commitment to increase diversity, Natale was told that some new minority hires “just weren’t ready” to meet the requirements of the job, that training was already in place and that time was limited to do more.

Some of the partners Natale has spoken to – even those who had fired a minority recruit – didn’t realize that a bigger investment in coaching could have led to a different outcome. “What more can you do to help them succeed is going to be key.”

In light of this survey follow-up, the Illinois CPA Society is bolstering its programming.  The scholarship program, which already includes $500 and access to training, mentors and other resources, is being fortified with a free CPA review course that normally costs $650, a customized mentorship program outside the workplace, and an assessment tool for employers to find out where the gaps are to level playing field.

As far as what firms can do, Natale urges leaders to customize their onboarding and mentoring. Turnover is high among all new hires and the labor shortage is the worst it’s ever been. “It’s going to be difficult to put yourself in their shoes to walk into a room where maybe a lot of people already know each other, or how to do their jobs already, and then they feel like an outsider or a stranger. Show them the ropes, help them get adjusted and help them build relationships. Those are things you might not think of with the majority of your hires.”



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