Jina Etienne, speaker, trainer, and diversity and inclusion consultant with Etienne Consulting, joins us to discuss the connection between diversity, equity, and inclusion (DEI) initiatives and CPA firm advisory services. Specifically, she explains how advisory services thinking can improve DEI results in the areas of hiring, process improvement, and marketing.

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By: Bill Hayes, Pennsylvania CPA Journal Managing Editor

Podcast Transcript

Today on CPA Conversations, we'll discuss two ways by which CPA firms need to improve, one being a strictly business concern, and one being not only a business concern, but a societal one as well. Yet our guest today, Jina Etienne, speaker, trainer, and diversity and inclusion consultant for Etienne Consulting, believes they are unquestionably linked. Those two areas are advisory services and diversity, equity, and inclusion initiatives.

What are the qualities that you believe make for a successful advisory services team in a CPA firm?

[Etienne] That's a great question, and I've found some inspiration in an article. It was an AccountingWEB article titled “What Skills Do You Need To Offer Advisory Services?” It's by Seth Fineberg. Seth listed five things, and, boy, oh boy, do they directly relate to D&I. The first one's data gathering. You need good data, good sources. The second one is analysis, that you need to make sure the data is clean, and then analyze it for things like KPIs, trends, dashboards, benchmarking, all of that stuff. Number three was asking good questions. Actually, he said great questions, because they can't just be okay. They're questions in terms of understanding the process as well as, "Okay, well what happens next?" The fourth one, specifically important to D&I, is active listening. So, I'm going to paraphrase this, but his question was something like, "How can I help you?" and then shut up and listen. Right? The shut up part, those were my words, but I think it's important.

Then the fifth one is clear and concise communication. So, be clear on the message and be clear on the goals. Then, have a follow-up plan so that accountability is part of that communication. I think all of those things are important for successful advisory teams in a CPA firm, and they relate directly to D&I.

How can firms bring the same qualities that make their advisory services successful to their D&I initiatives to make those initiatives stronger? What are those connections? What are those commonalities?

[Etienne] So if you take them one by one, the first one is data gathering, and it's the same answer. You need good data. So D&I, while it's important for it to be a people thing, we know that diversity, there's a correlation between improved racial and ethnic diversity, as well as gender diversity, and organizational performance. While the people part is important, because this is a cultural thing, what does it feel like to work in a firm? But we also know that this is business. To understand that connection between diversity and performance, we need to have the data, we need to know what the benchmarks are, and we need to look at the policies and the practices that have been developed or as it connects back to the data. Data gathering and analysis, those are the first two steps.

Then he says, "Ask great questions," and this is particularly important for D&I. Because too often we already think we know the answers. And by “we,” I mean leaders in firms and engagement teams. Statistically speaking, those leaders are predominantly white and most likely male. So, if we're going to understand diversity and inclusion, that understanding has to be based on asking questions and then listening. Number four, active listening. Go back to the shut up and listen part. The impact of programs, the benefit of initiatives, the importance of strategic plans should be informed by the lived experiences of the people you're trying to help.

If you're trying to help a particular group, women, or minorities, and that's probably defined as the people who are different than the majority people in the firm, then you should ask those people for what those experiences are and what things should help. Listen to understand. Please don't listen to say, "Well, here's what I think about that." I think that if you put all of those steps together and come up with a plan that includes accountability, you're basically doing for your firm the same thing that you're doing for your clients.

Now, an interesting expression or term that you had in a piece that you did for AccountingWEB on this topic: “The shoemaker's children go barefoot.” Do CPA firms who advise clients on matters like this, whether it be on diversity or otherwise, often forget to apply their advice to themselves?

[Etienne] I actually think this is true for a lot of businesses. Before I moved on into these new roles, I was at the AICPA, I was at NABA, at Grant Thornton. But before those roles I spent 17 years in practice owning my own firm. I am a CPA with a tax background, and my practice was tax-focused, tax-centric. I think something like 80% of my revenues were tax-based. And one year I forgot to file my own tax return. Thankfully, I was getting a refund, so there weren't any penalties. But I learned a very valuable lesson that day, that I need to put myself into the system as a client. All due dates, all deliverables. Otherwise, I wasn't doing the same thing for myself that I was doing for my clients. I think that's true for a lot of firms. We are great in our profession at looking at problems, analyzing, and then finding solutions. Why don't we do that for ourselves?

If we know the data is clear, that there's a correlation between diversity and performance, then what are we waiting for? And I mean that genuinely. I'm scratching my head. Is it because we're accountants and we need to see causation? Because you're never going to see causation. So, I think it's important for us to think about what is holding us back, why don't we take the skills that we know we have and we offer regularly for clients and apply them to our own problems? I don't just mean D&I, it could be a lot of different problems in our firms. I think we get distracted by our own smartness. And we are a brilliant, brilliant profession. I'm not saying that because I'm part of it. But I just think we are often too smart for our own good. The whole idea between “the shoemaker's children have no shoes” is because they are too busy selling them to everybody else that they never stop to provide their own children shoes, because it's not top of mind.

Let's go over a few areas where advisory services style thinking can be applied to strengthen D&I. How can the area of hiring be improved?

[Etienne] So, that is a simple answer and a complicated answer. The simple answer is go to different places to find more people. Don't keep going to the same sources and then expecting a different result. So, if you go to Penn State, and that's where you always go for your talent, and then you turn around to your recruiting team and say, "Why aren't we finding more diverse talent?," and you keep going to Penn State, and now you're spontaneously expecting to find more diverse talent, I'm going to think it's not going to work. You really need to think about diversity recruiting specifically to understand: where do you source candidates? Are the pool of candidates that you're even looking at more diverse? If not, how do we create a more diverse pool of candidates to begin with?

Then we have to look at all of the steps in the recruiting process because we know that there's bias baked into some of these systems. Not because people intend to be biased, but because humans are naturally biased because that's how our brain works. Going back to the advisory service thinking, step back, analyze all of those steps, objectively understand the impact, measure data, qualitative, quantitative, and fix. Every step of the process, from where we recruit, how we identify candidates, what we recruit on, do we recruit based on skills? Do we recruit based on GPA? If we do, can we look and see what's the correlation between GPA and success in our firm? Because the data is probably going to show us there isn't one. If that's the case, then why do we keep using it? So, I think that there's an opportunity for us to apply the simple data analytics to every step of our recruiting process, and then compare the results for your diverse pool of candidates to the majority pool of candidates. I think those differences will reveal opportunities to make improvements to the system.

Then you keep doing that over time, and each time you find a new data gap or a different trend, you tweak your process. This doesn't just result in more diverse talent, this results in overall better talent, because you're hiring talent that you need to do the work, provide the services as you go forward. We can't hire based on what we did before, because the work we're doing moving forward, this profession is changing rapidly. So, we need to keep up with those times by looking for the different skills, styles, perspectives, and experiences that can inform the work moving forward. It's the exact same thing we would do for our clients who are looking to grow. They have a product and we want to help them rethink that product moving forward. Something tells me this is the same thing that we need to do for ourselves. And recruiting is just one area.

How could the counsel CPA firms apply to process improvement be bolstered by a more diverse team?

[Etienne] So, we were just talking about recruitment and how to improve the diversity of the workforce. That diversity will influence all the other work that we talked about at the beginning. Data analysis, data collection, listening. The reason for that is that different people see things and experience things a different way. When you have a more diverse team you're going to have more ideas, different ideas.

It reminds me of this TED Talk. I don't know how to pronounce her first name, if it's Rocío, but her last name is Lorenzo. And for anybody who wants to look it up, the title is “Want a More Innovative Company? Hire More Women.” So, what she did in her organization was they did a study, and they literally looked at two things: how innovative were they, and that was based on revenue from new products and services. And how diverse they are, and they looked at six factors, like country of origin, age, gender, and so on. She said their data was clear: more diverse companies are more innovative, period. She said it's a chicken and egg thing. Are they more innovative because they're more diverse, or were they more diverse because they were innovative? And that it was a correlation not causation thing, going back to my previous point.

Then, the answer to that is: what difference does it make? What we now know is that more diversity results in more innovation, and more innovation as measured by increased revenue for new products and new services. If we as an accounting profession, particularly for those offering advisory services, want to enjoy that benefit of increased innovation, I think that involves our internal work, but imagine what we could do for clients if we were able to then apply that benefit to the services that we're offering. I just think that with a more diverse team we will naturally think a little bit differently, and that thinking will influence the way our teams engage, the way we approach engagements, and the results of those engagements as it relates to services delivered to clients. For all I know, hey, I'm just getting excited here, thinking, "What about the cross-selling opportunities?" There might be new ways to cross-sell services that we hadn't thought about because we have different people thinking about the problems.

Are there ways that a more diverse team can improve a CPA firm's work in the area of marketing or branding?

[Etienne] Oh, absolutely. That's exactly what I was just talking about. I was thinking about ... I was watching a movie the other day. It was A Star Is Born, but that's not the point. I love that movie. But I remember when my husband and I went to see it. And then as we were walking out of the theater, you know how you tend to talk about the movie you just saw?

What I thought was interesting, and then I was reflecting back on this, this happens all the time, the person or the group you just saw the movie with, and then you start talking about it, each one of us had a slightly different reaction, perception, or experience around that movie. Because as humans, inevitably we see things differently, we feel things differently, we experience things differently. That's because of the totality of our background and things that we've learned growing up. Beliefs, values, etc. Those exact same differences inform our marketing strategies. Those exact same differences show up in our branding messaging. If we have more diverse teams, then we have opportunities to see our services differently, and as a result sell our services differently.

Again, no offense, this is kind of a statement of fact, but if you look at the ... well, the data is ... you've got to take the data with a grain of salt. But if you look at the trends report from the AICPA, and you look at partners in CPA firms, they're 95% white and 77% male. Now we know advisory services teams are more diverse than that, but even if they're still majority male and majority white, that tells us then that how we position products and services, and then how we sell those products and services, is largely informed by the perceptions of what is a largely homogenous group. Perhaps if we had a more diverse group, we might better understand different clients or different markets or different communications channels, or how our prospective clients perceive things. That nuance in marketing is going to be so important as we offer more and more specialized services.

The same is true for branding, that clients today, customers today, are looking to companies and firms to stand for something. That includes social issues, environmental issues, political issues. We've seen examples of that over and over and again in the last year. So firms can't just check the box, put a statement on their website that says, "Diversity is important. We believe in inclusion," and move on and keep doing the same things. They have to demonstrate that commitment. And when the clients see the firm is aligned with their values and their principles, that the beliefs and the policies and the principles that the firm stands for, the causes that the firms stand for, and the people in those firms, reflect all of that, and it aligns with the client, there's actually increased stickiness so the client will stay longer. Now this is anecdotal, if you ask me. I didn't look up to see statistics on this. But the clients will stay longer. The clients will be more flexible. And there's likely going to be more referrals.

By “flexible,” I mean, when I was in practice, I remember I had a situation. My father passed away in August. No, he passed away at the end of August, his funeral was at the beginning of September. My client base was largely on extension. The biggest due dates for me were September 15th and October 15th. So, a week and a half before the September 15 deadline, I'm not doing okay. I'm hanging in there barely. And I can't tell you how many clients said to me, "Jina, that's okay. My return can go late." I was like, "Wait, what? Who says that?" I think that's an example of when what you stand for as a firm is aligned with what your clients believe, the trust is there. I mean, not all my clients said that, but I had at least a half a dozen clients say to me, "Because I know you got my back. You'll figure it out. And if there's penalties, we'll figure that out. I trust you."

I think that that kind of trust is something that can be fortified when you can demonstrate that your firm actually is living your stated commitments to diversity and inclusion. It then shows up in your branding, it shows up in your marketing, it shows up in every other thing that we've talked about.

Two segments that jumped out in the piece that you did for AccountingWEB on this topic: the description of psychological safety and the statement that diversity is not enough. What would you say the ideal work environment or culture is in a workplace to foster not only diversity, but equity and inclusion? What's it got to be like?

[Etienne] I think a lot of people think that diversity is the goal, and diversity is important. There's an under-representation of a lot of different groups in the accounting profession. Yes, we have to increase diversity. But diversity without inclusion is almost like … go back into the 60s and 70s and think integration. By that, I mean we have multiple groups in the same space. Imagine you take a bag of M&Ms and you dump it out. Okay, forget the fact that they're going to spill all over the place. Put them back altogether. Then, I want you to separate them all into little color groups. I got the brown ones over here, and the red ones over there, yellow ones here.

When you just dumped it out and it was just a mesh of M&Ms on the table with lots of different colors everywhere, that's my visual equivalent of what inclusion might look like. But when you separate them off into little piles, the red ones over here, the yellow ones over there, that is diversity without inclusion. Yes, I have lots of different color M&Ms on the table, but they're all grouped separately. So, I think diversity without inclusion doesn't change the game. If you have inclusion without diversity, you just have homogenous groups that are really getting along, but that's not bringing you the diversity of thought. Then you have the psychological safety piece. That's critical in order to foster that inclusion, because psychological safety provides a space where everyone feels that they can speak up and share what they actually think without negative consequences to future promotions, invitation to be on certain engagements, opportunities for professional development and training. Or heck, just being invited to coffee with your colleagues when they all make their Starbucks run.

This is true for all of us, whether we're a minority or not, that if I don't feel safe to tell you what I really think, I promise you I'm not going to do that. If you don't hear what I really think, then maybe if we're not hearing what everybody really thinks, are the solutions you're coming up with really the best? So, I think you have to have inclusion, everybody's part of the team. And the team needs to be diverse. We have lots of different thinkings and styles and perspectives in the team. You have to have psychological safety where everybody on that team can say what they really think. So, encourage debate, invite different ideas, challenge the status quo, empower the team based on outcomes. Don't evaluate people based on skills or GPA. Because once they're in the organization, it doesn't matter how they got there, it matters how they're contributing to the future success of the organization.

You can even evaluate managers by looking at the diversity of their teams. Understand what an inclusive manager does and looks like. And then find ways to hold your managers accountable, because at the end of the day diversity is an initiative that starts in the Ivory Tower, so to speak. Leadership comes up with the strategy, and when leadership demonstrates a commitment through funding and accountability, that means they push it down to management for execution. Meanwhile, you have your staff who intellectually understand the commitment to D&I because of what leadership says, but if that doesn't match my experience here, if my manager seems to be indifferent to that strategy, then perhaps the firm isn't as committed as I thought.

So the way managers show up, how inclusive a manager is, will inform all of the things we've talked about. Because if you say you're inclusive, but you have employees that don't experience that sense of belonging, then are you really inclusive? Because it doesn't matter what the firm says they want to do, what matters is the experience of those people in the firm. That experience validates the commitment. And so I think that that's really, when I was talking about it in that piece between psychological safety and diversity is not enough, they go hand in hand.

I think this is so important, and we just scratched the surface here. There's so much more to this. That's what I'm doing in my practice: I'm really trying to help firms raise their awareness. Because until we understand the nuances of some of these things, the activities that we go through are performative, not transformational. We want to be transformational, not just performative. That's how we will achieve results as a firm, as an industry, and certainly solutions for the client.