15th September 2011:

The last posting

Well this is it – my last blog posting as CEO of BDO International Limited.  Although I don’t actually stand down from this role until the end of the month I am now (just about) ‘winding down’ and have agreed that my successor should take over the CEO blog next week.  I am particularly pleased that Martin van Roekel has decided to continue to have a  CEO blog and look forward, along with many others, to reading his thoughts over the next few years.

It is fitting that I am typing this posting in China – on my last major business trip (albeit I am going to BDO Canada’s AGM next week and to a meeting with IFIAR in Bangkok the following week – did I say I was ‘winding down’?!).  I have in fact spent time this week in China and Japan  - both of which countries have seen significant growth for BDO and each of which demonstrates the significant development in BDO over the past several years.

China is clearly an emerging and growing economy with a fast growing professional services sector and where BDO has demonstrated a preparedness to invest and an ability to grow a significant business that can match (or beat) any of our competitors.  I believe that BDO’s growth in China over the past few years is easily the fastest of all the major accounting firms and has been achieved without compromising our commitment to quality in every aspect of our business.  Indeed, I am confident that our business in China today has higher quality standards as well as much greater resources and capability than ever before.

Japan is of course a mature economy and one that has faced significant challenges in recent years – and particularly this year following the earthquake, tsunami and damage to some of its nuclear power plants.  Growing our business in mature economies is more challenging, particularly those that are dominated by the four largest firms – and their dominance in Japan is extreme.  However, the growing attractiveness of the BDO brand has enabled us to substantially increase our audit business and I am confident that my successor will soon announce a substantial increase in our tax business in Japan.

Asia Pacific has been BDO’s fastest growing region in each of the past several years and I am confident this will continue to be the case although we are also enjoying significant growth in Africa and elsewhere.

In addition to the significant amount of time I have spent in China and elsewhere helping develop and grow the BDO network, the other matter I have spent much time on has been in the area of competition or choice – or more accurately the lack of competition and choice in certain parts of the audit market.  I am increasingly optimistic that legislators and regulators will now address this issue and look forward to developments later this year in the EU as well as in the UK and possibly also the USA.  I continue to regard it as disappointing that we need regulatory and/or legislative intervention to address this long standing concern and that the profession has been not been able to find a ‘voluntary solution’ to the challenge; indeed it is even more disappointing that many in the audit profession still seem to think there is no issue and have failed to properly engage with this debate and perhaps worse that some deny the prevailing facts about the dominant position of the largest firms and the distorting effect this has on the market.  BDO’s success in both China and Japan has demonstrated that the market place on both emerging and mature countries wants more choice and we are fortunate that the circumstances have enabled us to provide it in these markets.  I hope that the circumstances will change in other countries to enable to do likewise.  BDO (and I am sure others as well) knows it will need to make further investments but is ready and willing to do so if there is a suitable opportunity.

It has been a privilege to lead BDO for the past three years and I wish every success to all my colleagues and to my successor, Martin van Roekel.

Finally, my thanks to those of you who have read and responded to my blog – including via email and in person; please continue to do so with Martin.  BDO, and the profession, benefit from your engagement.

 International BDO  6 Comments September 15th, 2011