The 1960s are known for being a time of change in America. The decade saw the March on Washington in 1963, Vietnam War protests, and the first moon landing; social, political, and scientific norms were being challenged. The accounting profession also was affected by the upheaval the country was experiencing at this time. In 1969, the AICPA Council passed a landmark resolution that opened doors of opportunity for people of color to attain CPA licensure. The 50th anniversary of this resolution is the perfect time to reflect on the origins and progress of diversity and inclusion efforts in the accounting profession and to consider next steps organizations can take to move forward (see the sidebar "Next Steps").
BARRIERS FOR MINORITY ACCOUNTANTS AT MIDCENTURY
In 1969, there were fewer than 150 black CPAs in America, less than 0.15% of all CPAs. At midcentury, many accountants from minority backgrounds struggled to attain CPA status, largely because they had difficulty finding employment at CPA firms and thus weren't able to meet their states' experience requirements for licensure. In 1951 Talmadge Tillman, for example, chair of the accounting department at Texas Southern University and the first black person to receive an MBA from Syracuse University, was offered a job with a CPA firm over the phone. When the interviewer met Tillman in person, though, he rescinded the offer. (Tillman did go on to work for a CPA firm, become a CPA, and earn a Ph.D. in accounting.) Another black accountant, William Collins, was told in the 1950s by a recruiter that the firm he was interviewing for had only recently started employing Asians and Jewish people but had "not come around" yet to hiring African Americans.
However, the 1960s also brought about a change in the profession's acceptance of minority accountants. In 1965, Hugh K. McKee of Alaska, a white AICPA Council member, proposed that the AICPA adopt a resolution that would declare that "there should be no discrimination because of race, creed, color, sex, or national origin in the employment practices of individuals or firms engaged in the practice of accounting." In her book, A White-Collar Profession: African American Certified Public Accountants Since 1921, accounting professor Theresa Hammond, Ph.D., notes that this was reportedly the first time the AICPA had been addressed on the issue of African Americans in the profession.
Without being seconded, the proposal lay dormant for four years. However, during that time, many AICPA members grew increasingly uncomfortable with the absence of a clear stance on discrimination. In 1968, AICPA President Ralph Kent declared that discrimination was in opposition to the profession's values.
Subsequently, the AICPA launched an 11-person committee, of which five members were black CPAs, called the Committee on Recruitment From Minority Groups. Chaired by Edwin R. Lang, a partner from Haskins & Sells, the committee drafted a different resolution that was presented and passed after extensive debate during the Council meeting in 1969. The text of the resolution read as follows:
- That a special campaign be undertaken to encourage young men and women of high potential from disadvantaged groups to attend college and major in accounting;
- That special efforts be made to provide educational opportunities for young men and women from disadvantaged groups so that they may enter the accounting profession without educational disadvantage;
- That such men and women be hired by individuals and firms in order to integrate the accounting profession in fact as well as in idea.
STEPS TOWARD PROGRESS
The passage of the resolution, combined with social change and increased awareness of the barriers minority CPAs faced, helped spur change. The profession was acutely aware of the financial barriers students of color faced when pursuing a degree and a career in accounting. Soon after the resolution was passed, state societies, firms, and many other organizations established minority scholarships.
Though this was one barrier to overcome, the second was ensuring minority CPAs were hired. The 60 largest CPA firms employed 197 black accountants in 1969 but, due to social change and the effects of the resolution, 700 just one year later. Between 1976 and 1989, the number of African-American professionals in major CPA firms grew by 43%. Other groups showed even larger gains: The number of Latino professionals in the largest CPA firms tripled, while the numbers of Asian and women employees each increased sixfold.
In the decades following the passing of the resolution, the profession has also taken important steps to increase the profession's diversity (see the sidebar "Membership Organizations Serve Diverse Accountants"). Notably, it has undertaken efforts to encourage students from different backgrounds to consider careers in accounting. Key awareness programs such as the "Be a CPA" campaign, launched in the early 1990s by the AICPA, featured celebrities and athletes with their CPAs. The most recent campaign by the AICPA, Real CPAs, highlights the unique and multifaceted lifestyles of young, ethnically diverse CPAs. Other initiatives that expose high school students to the profession have included programs modeled after the National Association of Black Accountants' Accounting Career Awareness Program (ACAP), which introduces high school students to accounting during a one-week college campus program that includes site visits to firms.
To further close the gap, the AICPA launched the Accounting Scholars Leadership Workshop (ASLW) in 1994. This invitation-only program offers junior and senior college students three days of leadership, career exploration, and CPA preparation.
The PhD Project, which also launched in 1994, set a clear path for black, Latino, and Native American business professionals to obtain doctoral degrees, become accounting educators, and subsequently serve as role models in the classroom. The program has helped more than 1,200 minority business faculty members earn doctoral degrees. (See the sidebar "Diversity and Inclusion Resources From the AICPA.")
GROWING DIVERSITY INTO THE 21ST CENTURY
Efforts such as these have begun to bear fruit, and more minorities are entering the profession. According to the AICPA's 2019 Trends in the Supply of Accounting Graduates and the Demand for Public Accounting Recruits survey, in the 2017—2018 school year, 16% of bachelor's and master's graduates in accounting were Latino, approaching parity with the percentage of Latinos in the U.S. population as a whole (18%). Thirteen percent of bachelor's and master's graduates were Asian, and 6% were African American. By contrast, in the 2006—2007 school year, just 5% of bachelor's and master's graduates were Latino, 8% were Asian, and 7% were African American.
The diversity of employees at CPA firms has increased over the past several decades, though there is still room for progress. In 1995, for instance, minorities represented 8% of professional staff in public accounting firms. In 2018, minorities represented 29% of all professional staff in public accounting firms, a sizable growth from 1995. However, 4% of the new bachelor's and master's accounting graduates hired by CPA firms were black, 10% were Latino, and 14% were Asian. Little movement, though, has been experienced in the diversity of CPAs and partners at public accounting firms, indicating there is still work ahead. In 2018 the majority of CPAs employed by CPA firms in 2018 — 84% — were white, and 91% of partners were white.
Looking into our past shows us how far we've come. Looking into the future shows us how much further we must go.
Organizations that have embedded key principles of diversity and inclusion have increased their operational and financial performance, increased employee engagement, and reduced turnover. They have also strengthened their brand at a time when new entrants into the workforce seek out organizations known for their commitment to inclusiveness. That's all the more important given that Gen Z, the generation now beginning its working years, is extremely diverse: Almost half of Gen-Zers are nonwhite.
Firms, state societies, professional organizations, and the AICPA have demonstrated a commitment to diversity and inclusion that has gotten us to this point. The next 50 years will require not only institutional, organizational, and leadership commitment but more importantly individual accountability. Without accountability at the individual level, even the best-laid plans will fail.
For 50 years, people of all backgrounds have contributed their unique talents, perspectives, knowledge, and hard work to positively transform the accounting profession. The approaches used in past years will no longer be enough as we venture into the next five decades. Here are steps forward-thinking organizations can take:
Deal with obstacles head-on
The best way to know what obstacles people of color and women are experiencing is to ask them and believe them when they tell you. Reframing the obstacles or even justifying why the obstacles exist can be more damaging than doing nothing.
Training employees on topics such as leveraging difference, unconscious bias, and cultural competency can be an important first step toward creating an inclusive environment. Ongoing reinforcement of training, through gathering feedback, dialogue groups, and setting goals to implement learning, will increase the likelihood that training brings about lasting change.
Remove bias from processes
Assess your processes for unconscious bias, especially around recruiting, company benefits, advancement and promotion processes, and project assignments. Seek ways to eliminate bias. For example, some organizations are removing key items from résumés, such as candidates' names, graduation dates, and schools attended, to ensure hiring managers are looking at the quality of the candidate and are not influenced by characteristics such as gender and ethnicity.
Make diversity and inclusion part of a long-term change strategy
Sustained inclusive behaviors occur when they have been implemented as an organizational change and not as an initiative that may one day lose its steam or funding. When approached as a change management strategy rather than a reaction to mitigate a problem, diversity and inclusion become integrated into existing business processes and the company's culture.
Provide employees with resources, data, and individualized support
Team members will come to diversity and inclusion with varying degrees of knowledge and interest. Share data with all employees, and train leaders to individualize their approach. Some employees will need a little more encouragement than others, which can be done by incentivizing participation and change.
Share responsibility and assign accountability
Most organizations have a diversity and inclusion professional and also champions who share the responsibility of implementing a diversity and inclusion strategy. Well-equipped champions can lower the degree of resistance to diversity efforts, collect feedback, and disseminate information to the rest of the organization. However, everyone should be held accountable for his or her individual actions and contributions toward creating a diverse and inclusive work environment where everyone has a sense of belonging.
Share the challenges, celebrate successes, and keep everyone abreast of changes. Communication is key.
Membership organizations serve diverse accountants
One important milestone was the founding of the first professional organization established specifically to uplift black professionals, the National Association of Black Accountants, in 1969. It was followed by the founding of organizations with a similar purpose, such as the Association of Latino Professionals in Finance and Accounting (now known as the Association of Latino Professionals for America) in 1972, the Native American Finance Officers Association in 1982, the AICPA's Women's Initiatives Executive Committee (WIEC) in 1989, and the pan-Asian organization Ascend in 2005. Each group has contributed to the diversity of the profession through advocacy, mentoring, and leadership development. Each has created a reliable and trusted network not only for its individual members but also for the firms that rely on its advice and guidance in their continued efforts to create inclusive work environments. These organizations have been an impetus for change and have helped to achieve progress over the last 50 years.
Diversity and inclusion resources from the AICPA
The AICPA has several resources that can bolster your firm's diversity and inclusion efforts, including:
- The Accounting Inclusion Maturity Model (available at aicpainclusion.com), an assessment that organizations can take to identify how they can improve their current diversity and inclusion efforts. It also serves as a benchmark for organizations to compare their progress to that of others their size.
- Tools and materials that touch on such topics as sponsorship, gender equity, recruitment, and retention, including the Recruitment and Retention Toolkit.
- Consulting services and trainings for firms upon request.
About the author
Kim Drumgo is the director—Diversity & Inclusion at the AICPA.
To comment on this article or to suggest an idea for another article, contact Courtney Vien, a JofA senior editor, at Courtney.Vien@aicpa-cima.com or 919-402-4125.
- "Challenges Continue for African-American Accountants," JofA, Jan. 2019
- "Have You Embraced Innovation, Diversity, and Inclusion?" CPA Insider, April 30, 2018
- "How to Counteract Unconscious Biases," JofA, Feb. 2018
- "Getting to Diversity 4.0," CPA Insider, Jan. 30, 2017
- "How to Sponsor Diversity in the Leadership Ranks," JofA, Jan. 1, 2017
- Diversity and Inclusion Initiatives page, aicpa.org