Departure of top EY boss exposes concerns over culture
Sunday, 17 March 2024
The NZ chair of EY has departed the firm over an “historical behavioural matter”.
The departure has prompted some former staff to detail what they called “horrific conduct” at the firm.
Tensions between partners revealed over differing standards.
Former staff of EY have described “horrific conduct” at the firm, in the wake of the departure of its New Zealand chair, but also say there is “tension between partners” because of differing views over what is or isn’t inappropriate workplace behaviour.
Stuff broke the news on Friday that departed chair Braden Dickson, who was also an EY Oceania partner and business development leader, left the company in February after an investigation into “an historical behavioural matter”.
Concerns about the matter were raised in December 2023.
An EY Oceania spokesperson said: “We are aware there has been some discussion about the circumstances but we are not in a position to comment on those.”
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Stuff has sought comment from Dickson but he has not responded.
In the wake of news of his departure, former EY staff contacted Stuff to raise questions about workplace culture and tolerance of inappropriate behaviour at the multinational company.
One former employee, who spoke on condition of anonymity because “the accounting world is small in New Zealand”, described sexist and homophobic comments making staff uncomfortable.
“I recall one of the audit partners [who Stuff has chosen not to name] … saying things like ‘nothing worse than a team of females when it’s that time of the month’, or he would joke about someone being gay.
“It doesn’t give you any comfort that you could raise an issue.”
Multiple former staff have described the impact of tolerance of workplace affairs.
“When you’re a 21 or 22-year-old and that stuff is blatantly in your face with no effort to hide it, it creates this atmosphere of ‘anything goes’.”
It would lead to tension between the company’s partners because some disapproved of others’ behaviour.
Multiple former employees have raised concerns about an excessive drinking culture, under which staff would begin drinking at 5pm on a Friday and continue until midnight before often heading into town, and then “drag yourself back in on Saturday or Sunday or possibly both”.
“You’d work long hours, then socialise with workmates, and that was your life,” said one. “People outside the ‘big four’ didn’t understand what was going on.”
The “big four” refers to the four multinational firms that dominate accounting business in New Zealand.
“It was an unhealthy, toxic environment, all-consuming,” the former staff member said, adding that while she did not know about Dickson’s departure until reading about it on Stuff, she was “not surprised”. “The conduct [at EY] was horrific”.
There had been some effort to “tone it back” but that was interpreted to be more to do with changes to Health and Safety legislation than a true desire to change the culture.
In a statement to Stuff, EY NZ managing partner Simon O’Connor said, “We’d strongly encourage anyone to come forward and report their concerns so appropriate action can be taken.”
He pointed to a recent EY workplace culture review, led by Australia’s former Sex Discrimination Commissioner Elizabeth Broderick, saying it was “the most comprehensive review of workplace culture ever undertaken in the New Zealand professional services industry”.
“We’re confident that recommendations of the review, which have all been accepted by EY, will make meaningful improvements to our culture,” O’Connor said.
“When we undertook this review, we committed to sharing the full report publicly, and have since committed to reporting on our progress against the recommendations,” O’Connor said.
Released in July 2023, the Broderick review found 17% of women working in the firm’s New Zealand and Australian offices experienced bullying and 15% of women reported having been subjected to sexual harassment in the past five years.
That figure was far worse for young women. Almost one in five aged between 18 and 35 years reported at least one instance of sexual harassment in the past five years.
One staff member told the review: “There was a Partner who tapped a colleague on the bum after a presentation saying ‘good job’. Other women complained but nothing was done. He is known to have problematic behaviours but nothing is done because he brings in a lot of money.”
Another said: “The Directors and Partners are all mainly men. They’re big drinkers. As a consultant you have to sit there and laugh, even if they are touching you on the waist.”
The Broderick review found that a “strengthened focus on diversity and inclusion has also led to a perception that there will be ‘winners’ and ‘losers’, with some Anglo-Celtic men, in particular, fearing that they may be losing opportunities, status and position in the organisation”.
The review, undertaken shortly after the sudden death of a staff member at the company’s Sydney office, also highlighted low reporting rates.
“There is low trust in reporting mechanisms, which means that people are often seeking to resolve issues without access to specialist support or formal investigation.”
Just one in three (36%) of those who had been bullied followed up with a formal report.
The reporting rate for those who experienced sexual harassment was even lower, with one in six (17%) of those who were sexually harassed reporting the incident.
“Many people have experienced retribution, particularly loss of access to advancement opportunities, when they have either formally or informally reported harmful experiences.”
The review found this was having a detrimental effect on staff well-being and performance.
“The data presents a strong theme of workers feeling unable to challenge hierarchies or provide feedback, fearing rejection or punishment.”
Anonymous staff members’ comments on this aspect are included in the report.
“Making a complaint is ‘how much do I want to f… up my career?’ We are unable to speak up because of the way promotions are handled with the ‘roundtables’.”
Another said: “Report? You have to be joking. It would be career suicide. It would fall on deaf ears. The only recourse would [be to] go to the media.”
Another spoke of their colleagues witnessing sexual harassment, “bordering on assault by being touched inappropriately”.
The staff member said complaints had been made.
“One of the perpetrators was known as someone who engaged in that behaviour and we brought him [into EY]. There was no flag on the system, and no due diligence was done. They are still in the building now. That’s the lack of accountability. The message is: ‘That’s ok’. He is a Partner and part of the boy’s club.”
That comment was supported by workplace survey results. Staff were asked if they agreed with the statement: “Reasonable and swift action is taken against anyone who engages in bullying, sexual harassment or racism, regardless of their seniority or status.”
Only 44% of women agreed, while 52% of men agreed.
Another staff member spoke of their direct experience of sexual harassment, bullying and mental health issues at EY.
“I don’t want anyone else to have this experience. It took so much from me. I won’t ever be the same person again. It was all preventable.”
Another spoke of staff turnover leading to new-hires “including people who sexually harass”.
The staff member reported: “I found out guys in our team are ranking women who they would like to f…. This includes details about women’s bodies and their experiences. It was deeply distressing to know that my team members were thinking of me in this way.”
Another told the review she received “backlash” when one of her colleagues claimed it was “scientifically proven” that men were smarter than women.
When she reported the comment to a partner, he responded: “Please, not the women stuff, today.”
While some staff praised the EY leadership, others were critical.
“[A manager’s] way of working might have worked in 1980 but it’s not 1980 now. That treatment is not acceptable. The Partners protect bullies. Often they are bullies and aggressive themselves. There are some partners I wouldn’t be in a room alone with.”
Some EY staff told the review that EY put profit over workplace safety.
“If you are delivering on the money, you can do anything and you can lose as many staff as you like, put them in mental health facilities, fail to protect them, be racist, be mean to people with disability.”
Another said: “The focus on [the] generation of revenue creates a toxic, competitive, and bullying environment. Many of the Partners appear to be in a “club” that creates and fosters very poor behaviour, which in turn creates a firm-wide culture that is psychologically unsafe.”
The 142-page review also includes a 27-point action plan that includes widespread policy changes.
NZ managing partner Simon O’Connor said EY was addressing all the recommendations, including how to keep leaders accountable, building awareness of the impacts of harmful behaviour, and improving trust and transparency in the complaints process.
“The strong advice from [the review] was to not immediately rush into implementing these recommendations - despite our desire to do so.”
He said EY had made important progress in creating an environment where “people feel safe to raise a concern…and have confidence in the complaints handling process, something that has been evident in the increase in the number of matters being raised with us, including recent events.”
However, former staff who spoke to Stuff remained concerned that senior managers about whom complaints had been made were promoted even after the review’s findings were released.