Fierce competition swells demand for young partners in Big Four firms EY, PwC, Deloitte and KPMG

MUMBAI: Kid – that’s the name he’s known by, especially among the directors and partners, in one of the Big Four firms. If one passed by him in a Mumbai mall, it would be easy to dismiss him as just another 30-something professional, but for that air of self-importance.

Kid was among the top 10 in his chartered accountancy exam back in 2003 and is now a partner with one of the Big Four, rides around in a luxury sedan and earns Rs 1.1 crore per annum. He works in the auditing network and reports directly to the national head of auditing, which is quite exceptional in such consultancies. Kid is the face of the 21st Century partner.

The most prestigious job in the Big Four—EY, PricewaterhouseCoopers, Deloitte and KPMG—is being redefined in ways many wouldn’t have imagined and at a fast pace, say industry trackers. Unlike about five years ago, the average partner in the Big Four today is someone who is a chartered accountant or holds a Master of Business Administration degree, is below 40 and earns Rs 1 crore annually.

Some say the sudden demand for younger partners and changed roles is due to a revamp of responsibilities. With the growing importance of India, the role of Indian partners is increasingly becoming global. “A partner on an account in India no longer has to just understand how the Indian business works and what the local rules are, but they’re going to have to think globally, and they have to understand the macroeconomic situations,” said Mark Weinberger, chairman and CEO of EY.

There are about 1,000 partners in the Big Four – a number that could jump to 1,300 in the next five years. While some may think that becoming a partner is now easier, it’s anything but simple – the competition is fierce.

“If you cannot become a partner by 40, you probably don’t have it in you,” quipped a senior partner in one of the firms, who takes prides in the fact that some 40 other partners report to him. As roles have changed, so have qualities that are given importance.

While technical knowledge remains vital, the ability to “sell” has become more important. With the Big Four having transformed from accounting and auditing firms into providers of professional services ranging from consulting to investment banking to forensics, there is a shift towards a more ‘business’ approach.

“In addition to understanding and listening to their stakeholders, aspiring partners need to be more agile and innovative to anticipate the impact on markets and clients and realise business opportunities,” said Deepak Kapoor, chairman of PwC India. “They have to continue to develop professionally, build global and business acumen, hone technical capabilities, evolve into ‘whole’ leaders, one who has the ability to lead and to make a difference and deliver results.” Also, specialisation has led to the proliferation of partners. If earlier there were general tax partners, now there are those that focus on aspects like direct tax, indirect tax, M&A and international tax.

As the firms grew, they not only needed more leaders but also those who could bring in additional revenue. Increasing the number of partners was the obvious option. Currently, the Big Four employ about 100,000 people in India. The path to partnership is shorter and the youngest are only 32 years old with about 9 to 10 years of experience.

Firms are fast-forwarding deserving candidates, a complete turnaround from the early 1990s, when no partners were inducted some years. “KPMG has put in a robust procedure which lasts 18 months before a person can be inducted to a partnership.

There is a mandatory Leadership Assessment and Development Centre (LADC) through which every candidate has to undergo. LADC is an assessment which helps candidate in ascertaining his/her strengths and areas of improvement. Thus we give a fair chance to all, so that they could work on their strengths/weakness for 12 months before they come up for partnership,” said Richard Rekhy, CEO at KPMG India.

Yet, it’s not all hunky-dory. Typically, a partner is required put in some of his own capital when he is promoted. This comes in a staggered manner from his/her salary. “This whole partnership business is a sham,” laughs a 35-year-old partner with one of the firms. “I get about Rs 1 crore per year, of which 15% goes towards partnership capital in the first year, not much remains after tax,” he claims.

Also, say insiders, the pressure is the highest on partners and often many are sacked after only two years. They say the very ethos of partnerships has changed. “At the end of the day, everyone wants that corner office,” laughs the head of auditing at one of the four firms vying for the job. “And now you have some 250 equally talented and hungry people vying for the same,” he added.