PricewaterhouseCoopers (PwC) has revealed plans to restructure its global network into three geographical clusters, a move described as “evolutionary not revolutionary”.
The announcement follows recent integration moves by KPMG and Ernst & Young.
The world’s highest earning network said the restructure will sharpen its focus on emerging markets, which PwC regards as the ‘engine of future growth’.
Member firms will be clustered by the east, which will comprise Asia-Pacific firms; central, which includes European, Middle East, African and South Asian firms; and the west, which covers the Americas.
PwC UK partner Peter Wyman told the International Accounting Bulletin the restructure is the result of a two-year review a decade since Price Waterhouse and Coopers & Lybrand combined. He said the restructure is not about merging national partnerships or global profit sharing.
“Global capital flows are shifting west to east, the world is moving even quicker and we needed to move quicker ourselves,” Wyman said. “Although there was nothing fundamentally wrong, [our structure] needed to be streamlined. We looked at all the options and concluded that for us, developing a bit of what we had before, but not tearing it up and starting again, was appropriate,” he said.
PwC said member firms will still function as independent legal entities but be more closely aligned to neighbouring firms and subject to the same quality control standards. PwC said the restructure will change several key organisational processes.
The clusters will be lead by senior partners in the largest firm of each region. The east cluster will be led by Silas Yang, senior partner of PwC China; the central cluster by PwC UK senior partner Ian Powell; and the west cluster by Dennis Nally, senior partner of the US firm.
PwC partners will vote on the restructure proposal in September. If approved, the new structure will be rolled out in October.
PwC global chief executive Sam DiPiazza said the revised structure would allow PwC to respond to clients’ needs with greater agility and speed.
He added: “While our member firms will be more closely aligned and more responsive, they will continue to be locally owned and managed, preserving the high level of accountability to our stakeholders and regulators, while encouraging the entrepreneurial spirit that has been the foundation of their success.”
Several of the world’s Big Four networks have moved towards integrating their practices recently. In July, Ernst & Young combined 87 member firms in Europe, the Middle East, India and Africa into a single business unit. It also integrated 15 firms in the Asia Pacific region.
KPMG started the consolidation rush by combining its UK and Germany firms in January 2007. KPMG Europe has since been joined by firms in Switzerland and Spain; however KPMG Netherlands partners declined the invitation last year.
Deloitte remains the only Big Four network that has not announced substantive restructuring plans. In June, Deloitte’s global chief executive Jim Quigley said the network has regional clusters of member firms but was unlikely to adopt a large-scale integration.