Still Seeking the Ideal

Opening its doors now to attract the best and brightest minorities will strengthen the profession for the future.

  • SEVERAL OBSTACLES PUT AFRICAN-AMERICANS, Hispanics and Native Americans at a disadvantage in the profession. A large gap exists between median incomes of these groups and that of the nonminority population. This affects educational opportunities for minorities.
  • MORE THAN 30 YEARS AGO, RALPH KENT, AICPA president, declared in his inaugural address that the time had come to integrate the public accounting profession "in fact as well as in ideal." Progress has been made, but there is still a long way to go.
  • ANOTHER OBSTACLE IS LACK OF FAMILIARITY with the accounting field. Because of the underrepresentation of minorities in the profession, many minority children grow up with little exposure to successful accountants as role models and don't view accounting as a possible career path.
  • CONTINUING DISCRIMINATION IS ANOTHER OBSTACLE. Incidents at several large U.S. corporations have demonstrated recently that discrimination still exists in the workplace. Many managers acknowledge that they are more comfortable hiring people "like themselves."
  • DIVERSIFYING THE WORKFORCE MAKES GOOD business sense. More and more, accounting firms will find that hiring minorities helps them serve the needs of an increasingly multiracial and multiethnic client base.
THERESA HAMMOND, PhD, is Ernst & Young Research Fellow in Diversity Studies and Associate Professor of Accounting at the Carroll School of Management at Boston College, Chestnut Hill, Massachusetts. Her e-mail address is t . Kenneth Paige, PhD, CPA, is Associate Professor of Accounting at the Palumbo School of Business Administration, Duquesne University in Pittsburgh. His e-mail address is .

Several obstacles put African-Americans, Hispanics and Native Americans at a disadvantage in the CPA profession. Each group faces unique challenges, yet all face some similar ones, too. These minority groups, targeted for encouragement by the AICPA minority initiatives committee, are disproportionately financially disadvantaged; they are less likely than majority-group members to have adequate preparation, career guidance and role models in the accounting field; and they face continued discrimination.

Today's more global marketplace and culturally mixed customer base may mean the time finally is right for the CPA profession to embrace diversity "in fact as well as in ideal." This goal was expressed more than 30 years ago in AICPA President Ralph Kent's inaugural address. Although progress has been made in CPA minority representation since that speech, the accounting profession still lags behind many other fields.


Studies published in 1990 in the JofA by Bert Mitchell, the chairman and founder of Mitchell & Titus, LLP, the largest minority-controlled firm in the United States, identified only 150 African-Americans among 100,000 (total population) CPAs in 1969. By 1989 there were 2,500 among 400,000 CPAs. The number of Hispanic CPAs also increased dramatically during this period. Despite these gains, African-American representation among CPAs remains below 1%. According to a 1990 report in USA Today, only airline pilots and navigators had a smaller percentage of African-Americans in their ranks.

The AICPA's 1997 Report on Minority Accounting Graduates indicates that Hispanics and Native Americans also remain underrepresented among accounting professionals in nonminority-owned public accounting firms. Although Hispanic representation increased in the past two decades, African-American presence in nonminority-owned CPA firms actually declined, from 1.8% to 1.4%, since the AICPA began keeping statistics in 1976 (exhibit 1, at right). This happened despite the fact that the number of African-American and Hispanic accounting graduates rose steadily during the same time period (exhibit 2, page 77).

As minorities move up the ladder, from newly hired graduate status toward partnership levels of a firm, each group experiences different degrees of upward mobility. The percentage of African-Americans and Hispanics at upper levels is markedly low (exhibit 3, page 77): African-Americans constitute 2.6% of hires but only 0.1% of partners; Hispanics constitute 2.7% of hires but only 0.3% of partners.


Income gap. There is a large gap between the median earnings of the majority population and those of African-Americans, Hispanics and Native Americans. College and graduate school attendance is a rarer opportunity for these groups because of economic disadvantage, and this exacerbates their low levels of representation among CPAs. Poorer students are less likely to attend the elementary schools, high schools and colleges that provide the skills necessary for succeeding in this demanding profession.

Although these statistics indicate some of the obstacles common to minority groups, their experiences have features unique to them. Hispanics, for example, have emigrated from more than 20 countries and constitute the fastest-growing minority group in the United States. While other groups' incomes rose, Hispanic household income declined during the 1990s. This is true even for Hispanics who are not new immigrants. A recent study indicates that language barriers and lack of educational opportunity are the main causes of this decline.

Similarly, a substantial portion of the Native American community is entrenched in poverty: 38% of Native Americans live on reservations, where poverty rates and unemployment are high and professional preparation is minimal.

Lack of familiarity with the accounting field. Members of minority groups are more likely to be unfamiliar with opportunities in the accounting profession for a variety of reasons. First, prior to the Civil Rights movement there were very few minority CPAs. In 1950, for example, there were 25 African-American CPAs in the country, fewer than one per 2,000 members of the profession. By 1965 there were 100, still fewer than one per 1,000 CPAs. The numbers were comparably small for Hispanics and Native Americans.

Young African-Americans, Hispanics and Native Americans making professional choices in the past few decades have had few CPA role models in their families. Professional fields such as medicine and law are more familiar to these communities, partly because they garner more attention on television and in the media. Historically, minority-group members have interacted with some degree of frequency with attorneys and doctors, but because of uneven wealth distribution they are less likely to have interacted with financial professionals. In the medical and legal professions the underrepresentation is not as severe.

In addition to having few role models within families, members of underrepresented minorities also lack role models in accounting classrooms. Studies in other fields have shown that a diverse faculty enhances the diversity of the student body. A varied faculty has been shown to lead to a diverse group of students choosing a particular major. Between 1986 and 1995, only 37 African-Americans, 11 Hispanics and 3 Native Americans earned PhDs in accounting (exhibit 5, page 79). Over 750 universities in the United States offer undergraduate degrees in accounting, and black colleges employ over half of all African-Americans with PhDs in accounting, so a minuscule percentage of accounting programs have minorities on their faculties as role models for students.

Continuing discrimination. Although it is uncomfortable to acknowledge, discrimination continues to exist, though perhaps in more subtle ways than in the past. Several recent incidents in major U.S. corporations serve as reminders that attitudes change slowly. Many managers acknowledge that they are more comfortable entrusting work to people "like themselves." Progress cannot be made unless accounting professionals examine and override attitudes that hinder giving all new colleagues the same chance to succeed. The absence of upward mobility for both African-Americans and Hispanics can be mitigated only if minority-group members are an integral part of all accounting firms.


Diversifying the profession has long been a goal of the AICPA, but the reasons underlying the importance of diversification have changed somewhat over time. In 1968, when President Kent made his historic speech, industries and professions removed their employment barriers in response to the Civil Rights movement's call for an end to discrimination. In 1980, an AICPA report summarizing the first decade of its efforts to increase diversity stressed the importance of increasing the potential pool of job applicants by ensuring equal access to the profession for all.

These reasons for diversifying the profession are increasingly bolstered by another: Diversity is good for business. As current AICPA President Barry Melancon stated at the 1997 AICPA faculty summer seminar, capital ownership is changing dramatically. Between 1987 and 1992, the number of Hispanic-owned businesses jumped 83%, with a dramatic 195% increase in revenues, to $73 billion. The number of African-American-owned businesses grew 46% from 1987 to 1992, with a 63% increase in revenues to $32 billion (exhibit 4, below). Customer bases are also changing: By the year 2005 minorities will be 27% of the United States population.

The AICPA minority initiatives committee, formed in 1968, continues to pursue the goal of integrating the profession "in fact as well as in ideal." Its activities (see sidebar, above) are designed to address some of the barriers faced by potential minority CPAs.  


Diversity can be achieved only through increased awareness and through efforts on the part of all AICPA members to bring together a more culturally mixed group of professionals. Some firms have already made a commitment to diversity (see "Diversity Is Good for Business," page 81). Others surely will follow.

The profession will be at a disadvantage if it does not change along with the changing composition of both clients and the workforce. By attracting the best and brightest students and professionals from all segments, we can improve the quality of the profession and enhance our contribution to society as a whole.

AICPA Minority Initiatives Committee Activities
  • Scholarships. The committee annually awards scholarships of up to $5,000 each to outstanding minority accounting students.
  • Mentors. "Partnerships for Success," a joint effort with several state CPA societies, matches scholarship recipients with CPA mentors.
  • Doctoral fellowship program. The committee distributes fellowships to students pursuing PhDs in accounting. These fellowships help improve the credentials of faculty in traditionally minority schools and contribute to faculty diversity in majority-white institutions.
  • Faculty summer seminar. This annual meeting gathers a diverse group of faculty to efficiently disseminate topical information designed to enhance the learning experiences of their students.
  • Accounting scholars leadership conference. Selected AICPA scholarship recipients are invited to participate in workshops designed to develop leadership, presentation, communication and team-building skills. This program, launched in 1995, has also emphasized exposure to minority professionals and to other successful students.
  • College residency programs. The committee provides seed money to help develop programs bringing high school students to college campuses to learn more about the accounting profession.

For more information on the AICPA's minority initiatives committee, or to become a mentor to scholarship recipients, please contact Gregory Johnson, manager, minority initiatives at 212-596-6227 or .


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