People over profits: ‘Don’t promote leaders unable to manage, develop staff’

afr.com:

The driving force behind a landmark report into the culture of EY says leaders should not be promoted further if they cannot manage and develop staff – even if they perform well financially for the firm.

Former sex discrimination commissioner Elizabeth Broderick also told the ongoing Senate inquiry into consultants that “most professional services firms have a culture of long working hours” because of their time-based billing systems.

Former sex discrimination commissioner Elizabeth Broderick. Tim Bauer

Ms Broderick noted her report into EY’s culture had reached similar conclusions to Ziggy Switkowski’s report into PwC’s tax leaks scandal: both organisations had put the pursuit of financial returns above their personnel, and staff at both did not feel empowered to speak out about bad behaviour.

“The area where I see a lot of overlap is in lack of psychological safety… [Dr Switkowski] pointed to a number of areas where people, if they’d felt safe to speak out, some of these issues might not have ended up where they did,” she said during the Thursday-night hearing in response to a question from Labor senator Helen Polley.

“I think we saw very much that similar issue at EY, particularly where people weren’t speaking up about sexual harassment or racism or indeed, most importantly, the long working hours culture. I think the analysis that is in that [PwC] report, as well as the analysis in our report… are useful learnings across the whole sector.”

EY has accepted all of Ms Broderick’s 27 recommendations, while PwC’s new leadership has promised wide-scale reform in the way the firm is structured, governed and led.

In the Broderick report, EY staff described the firm as having a business model which put “profit and delivery