The Global Corporate Brand Book by Michael Morley

Author:Michael Morley
Language: eng
Format: epub
Publisher: Palgrave Macmillan
Published: 2008-12-31T16:00:00+00:00

ACCOUNTING

Accounting firms were early entrants into global branding and it is not hard to see why. As industrial and commercial enterprises started to internationalize their operations they needed help to understand the financial regulations and customs of the new markets they were entering and they expected this help to come from their trusted internal and external advisers. Now, while it might be good business practice to adapt some company policies and procedures to accommodate local customs, the most tangible outcome of the auditors’work is the annual report and accounts. This, by definition, is a single, unchanged document whether it is being read in San Francisco, Stockholm or Shanghai. The early pioneer firms were happy to oblige but first they themselves had to find expert resources in all the key markets around the world which had the skills to act as local partners. In a gross oversimplification, this was done by creating a unified globally licensed brand name. Local firms of sufficient quality and resources were recruited to join a federation of firms which had the rights to use the name and to provide seamless service to each other’s clients. It is a remarkable model that has worked brilliantly for decades and led to the creation of four great firms (known by some wags as “the final four”) as well as a number of second tier firms that also offer worldwide service. The big four brands are PricewaterhouseCoopers, Ernst & Young, Deloitte and KPMG.

Accounting firms are the only professional service organizations that made it into the Brand Finance 500 rankings for 2007. The clear leader of the “big four” is PWC (PricewaterhouseCoopers) which comes in at 98. The details are as follows in US$M:

Enterprise Value $71,366 Position 98

Brand Value $7,850 Brand Score/Rating 90/AAA+

For most people, most of the time, the assumption is made that each of these firms has a structure and operates much like a multinational industrial company. That is far from the reality. In fact, in their case “brand” might be a more exact term than “firm” because each comprises a number of independent firms that have agreed to maintain certain standards, use uniform methodologies, share clients and pool knowledge for mutual benefit under a distinctive name and design. Each remains a separate legal entity, has its own management in each country, with its own partner income and profit pool.Ithastooperatewithinthelawsofthelocaljurisdiction,anditsclients’ financial transactions and reports are governed by local national regulators.

While the umbrella brand can be managed for the most part, it is now increasingly coming under strain. The accounting firms have so far benefited from the bifurcated structure – global brand on the one hand and a collection of private local partnerships on the other. In litigation, the big four stress their local autonomous structures to militate against massive liabilities and damages being imposed on the global enterprise. But where the proactive marketing of their resources to clients is concerned, they adopt the posture of unified brands. It will be interesting to see if this ambiguous position can be maintained in the future.

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