The United States is grappling with a significant shortage of accountants, as over 300,000 professionals in the field have left their jobs in the past two years. Moreover, there is a decline in the number of individuals taking the Certified Public Accountant (CPA) examination. In response, accounting firms, both large and small, are exploring innovative strategies to attract and retain talent in this increasingly scarce labor pool.
BDO USA, the sixth largest accounting firm in America and a member of the BDO International accounting network, recently introduced an employee stock ownership program (ESOP) to address this issue. This program grants over 10,000 eligible employees partial ownership of the firm. Under the ESOP, employees can invest 10% of their annual salary into an allocation account, which becomes accessible upon retirement. The aim is to incentivize employees to remain with BDO for a longer duration, even if they are not aspiring to become partners. This program has a six-year vesting period, meaning that the longer an employee stays with the firm and contributes to the program, the greater their retirement benefits will be.
Wayne Berson, CEO of BDO USA, recognizes the evolving expectations of professionals entering the accounting field today. Many are no longer interested in spending a dozen years or more before attaining a partnership at an accounting firm. The ESOP allows BDO to offer employees a beneficial interest in the firm's future profits, thereby increasing the potential allocation of funds as the firm grows more successful.
Research suggests that companies with ESOPs experience lower turnover rates and higher employee performance compared to firms without such ownership plans. However, BDO is not solely relying on the stock ownership program to address the scarcity of accountants. The firm plans to double its offshore workforce to 5,000 individuals within the next five years, while also implementing various benefits and policies to enhance employee retention. These measures include allowing teams to establish their own hybrid work policies, and providing flexibility to employees.
Cathy Moy, BDO's chief people officer, acknowledges that there is no one-size-fits-all solution to retaining talent. Nonetheless, she believes that the investment plan is a crucial component in the overall strategy to attract and retain top talent at BDO.