Staffing challenges arise from
rampant growth in China

The Chinese accounting profession’s rapid growth is
presenting unique staffing challenges, according to Ernst &
Young (E&Y) China. The firm’s managing partner, David Sun, said
China has been an excellent area for the global firm to expand its
practice with double digit growth in all core service lines.
E&Y China revenues increased by 41 percent for the fiscal year
to 30 June 2007 with its Far East region, one of seven E&Y
practice areas, posting $1 billion in revenue and growth of 27

Sun stressed the need to develop and retain staff is a vital
strut of this projected growth. E&Y China currently employs
8,000 people, an increase of 30 percent in the past year. This is
in line with its target to employ 11,000 people by 2010.

In 1992 there was virtually no accounting profession in mainland
China but 15 years later there are 130,000 members. However, the
demand is still a lot larger than the supply, according to Sun. “In
the next few years the training at universities and setting the
foundation for the training of accountants is very important,” he

Sun said E&Y faces stiff competition and gender and cultural
challenges in its battle against staff attrition. Staff loss is an
unwanted side effect of the Chinese economy’s success. He said the
buoyant market has resulted in E&Y losing staff to clients who
look to firms as a field for recruitment.

Gender issue

Gender is also an ongoing issue in China. “Many people joining us
are female but then as they progress the female attrition rate is a
lot higher and so certainly that will affect the growth of the
profession as well,” Sun explained. Addressing female attrition is
an industry challenge, as 70 percent of Chinese university
accounting students are female. Within E&Y, the rates reflect
this gender imbalance: 64 percent of all its employees are female,
although at the partner level females make up only 27

Sun said the predominance of women coming into the profession will
require Chinese firms to be more sensitive to female needs. “We are
setting personnel policies that will help female accountants, staff
and executives in our firm manage the work/life balance. [We are] making it more flexible for them, using technology to make sure
they can handle the demands of home life as well as professional
life,” he noted.

Promoting a better working relationship between mainland and Hong
Kong Chinese, and non-Chinese, is another unique challenge.
Mainland Chinese make up 85 percent of E&Y China’s staff, with
Hong Kong Chinese accounting for 10 percent and non-Chinese the
remaining 5 percent. Sun explained: “[Mainland Chinese and the Hong
Kong Chinese working together] is not as easy as many people think.
Hong Kong Chinese are slightly different from mainland Chinese. In
many degrees it is different because we come from different
environments, backgrounds and different mindsets, and so that in
itself has already needed a lot of attention.”

 The firm has tried to reduce cultural differences with
teaming exercises that put different groups together to work –
which can include non-Chinese from 30 to 40 different countries.
“We have sessions that actually talk about these differences to
help our staff, particularly those people from Hong Kong going into
China, to be more sensitive and to be aware of the differences,”
Sun said.

Nicholas Moody