Interview – Jean Stephens, Global CEO of RSM – Part 1

Interview - Jean Stephens, Global CEO of RSM – Part 1

Accountancy Age sat down with Jean Stephens, the Global CEO of audit, tax and consulting network RSM, to discuss her thirteen years in this role, RSM’s vision and strategy, the key long-term changes she is anticipating in the industry and the importance of leadership and diversity. In this first part, Jean discusses RSM’s aspirations, its global expansion and the key challenges and trends the accountancy industry is facing.

Interview – Jean Stephens, Global CEO of RSM – Part 1

Speaking in the boardroom at RSM headquarters on Cannon Street in the City of London, Jean Stephens – RSM’s global CEO – comes across as being incredibly relaxed and happy in a role that she has made her own over the last 13 years. This time has spanned a period of great change and progress for the organisation that now has 41,000 staff across 116 countries, and Jean has been at the forefront of it all in that time.

“I’m a US CPA. My training focused on audit, and a I moved here in 1996 to work with the CEO at the time for 10 years,” she recalls. “When he stepped down, the board asked me to step in as CEO. That was in 2006, so a long time.”

“I’ve seen RSM change and grow and develop and so, as you’d appreciate, I know it very well as to what we’re doing and where we’re going.”

Re-brand to RSM International

In October 2015 the network underwent a global re-brand, bringing together all practices under the RSM name, including the newly-joined UK firm which was still known as Baker Tilly at the time. This wasn’t as easy as flicking a switch, but was the culmination of years of hard work. Despite the achievement of leading this change, you can tell Jean does not dwell on the past.

Our focus is to be the dominant organisation serving middle market companies.

“So [2015] was the end and where we said ‘Okay, we’re not going to be able to progress to the next level until we get that finished’, and now we’re really focused on digital and how that’s coming in and how that’s affecting and changing us, so that’s a whole other area of which to look at and focus on. Innovation is another one.”

“Every year, over all of our strategies, there’s something exciting, new and big that is going to transform us. How do we look five or ten years out and start to do what we need to do now so that we’re forward thinking to be able to achieve our goals and our mission and our future?”

In terms of UK accountancy firms, RSM sits in the important bracket below the Big Four, and focuses on the middle market. When asked whether the she has aspirations to break into the Big Four, Jean said: “Our focus is to be the dominant organisation serving middle market companies. That is where most of our firms are and what their expertise is, what they serve, what we’re good at, and we’ll continue to go in that direction.

“It doesn’t mean we don’t serve larger companies, but we want those growing ambitious entrepreneurial companies that need advice and assistance, and we help them go on that journey.”

Jean does not just lead the business from the boardroom, and ensures that she visits as many practices as she can around the world. As Global CEO, she says she travels for about 70% of her time, which is no surprise given the number of countries RSM has practices operating in.

With all those practices now operating under the global RSM name and brand, one challenge she faces is ensuring that all firms are pulling in the same direction.

“That’s the fun part of the job really, being able to travel around, talk to everyone. I think that it starts with being clear as to who you are, both as a leader but organisationally. You have to spend time. You have to build the relationship. You have to listen. You have to really approach it with ‘okay, let me understand’ and then once you have that then you can start to say ‘okay, here’s what we’re all about’.”

Global Expansion

RSM does not expand for expansion’s sake, and while the group is looking to increase its global reach, there is a process to ensure that any firm that joins the group matches its values. In July, RSM announced that the group was finalising a merger with Chinese firm Huapu Tianjian Certified Public Accountants (Huapu Tianjian) to form RSM China, resulting in a 40% growth, but that decision took much deliberation.

That is the only way that you can have any kind of long-term successful relationship

“I spent many, many trips to China to talk to many firms to see where the match is. That’s what we’re looking for, it’s gaining that understanding before any firm comes in so that we can have those conversations saying ‘here’s what the expectations are of RSM, here is what our brand is about, here is how we deliver on the brand, here is what your responsibilities are’ and not selling RSM to anybody, but having conversations as to whether it’s a match.

“That is the only way that you can have any kind of long-term successful relationship. It’s not about selling, it’s about having a conversation, seeing if it’s a match for us, but equally important, for the firm too.”

Digital transformation and innovation

Looking to the future, Jean has sounded out digital transformation as one key challenge facing the future of the global accounting industry. With the UK’s ‘making tax digital’ initiative now coming into force, and many other countries already having such an initiative in place, along with artificial intelligence, blockchain and the development of accounting software, it is vital the big accounting firms stay ahead of the game when it comes to digital technology.

“I think digital’s a big one. What does that mean and how is that going to change the ways of working,” she says. “But then of course using technology to serve clients and investing in the right things at the right time, so we’re not necessarily going to go out and invest billions into something, but we can collectively invest in different ways of approaching an audit or using technology.”

Another challenge is innovation. Digital innovation to prepare for digital transformation is vital, but so to is moving forward more generally.

Innovation is not necessarily coming just from the larger firms because sometimes the smaller firms and smaller economies can move faster.

“I think that certainly for RSM we need to ensure that we’re very agile in our thought processes, that we’re able to be healthy in terms of how we approach new things, and to be okay with managed failure because we learn from it and that our culture is such that we embrace it.

“I don’t think innovation is an incubator unit. I think that’s part of it and having a place for good ideas to come, but for me it’s really being an innovative organisation, so having an innovative culture and a way of approaching things and a way of culture at all levels throughout the organisation.”

In terms of where in the world she sees the most innovation, Jean said: “We have our US firm which is doing some really interesting good things and exploring different ways to [innovate] and that is really high on the agenda and management and leadership need to own it, I think, otherwise it’s not going to happen.

“Some of the surprise markets I think are some of the smaller markets. Eastern Europe is particularly strong and really creative and thinking about what they can do and how to do it, how to approach things differently, so it’s not necessarily coming just from the larger firms because sometimes the smaller firms and smaller economies can move faster because they get an idea, they see something and they see an opportunity and they can move faster.”

Jean also recognises the trend in the industry from compliance to advisory, with more and more accountants finding themselves in a position to advise their clients.

“We’re going to see that more and more, where a lot of what was done before in terms of compliance is now in-house or is more easily done, and then the value that comes from that advisory space, and the power of being understood in what we’re trying to do is that relationship with the client and we believe that that’s never going to be replaced,” she says.

“We all have trusted advisors where we just need to process and to talk and to work with them and that’s how we can best help our clients and that’s a unique space for us. If we do it consistently all around the world, and we do it in a way that means something, than that is then what’s behind the RSM brand.”

Look out for the second part of Jean’s interview next week on Accountancy Age, where she discusses leadership and the importance of diversity.

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