Me the Good and the Bright
Michael K. Shaub
2006 - Even with the string of financial frauds that led
to the Sarbanes-Oxley Act of 2002 (SOX), some accounting
professors continue to wring their hands not over the moral
failures of the profession, but over attracting students
who are “the best and the brightest.”
by professors Thomas Frecka and William Nichols, published
in Issues in Accounting Education, found that the
best MBA programs are attracting students with significantly
higher test scores than are the top graduate accounting
the Curriculum to Attract New Recruits
proposed solution to this is, as always, improving the creativity
and relevance of graduate accounting programs. Graduate
accounting programs are seen as cookie-cutter curricula
that point only toward the traditional role of CPAs as auditors.
Graduates are perceived as having inadequate business savvy,
and the implication is that they are no match for their
improving the relevance of graduate accounting programs
is the solution to attracting the best and the brightest
to the profession. Universities appear to be willing to
do whatever is necessary to draw in targeted students, including
classes any time of day or night (or online), hands-on experience,
world travel, or an enviable lineup of guest speakers. So
maybe more relevant and creative accounting programs will
be enough to fix the problem.
I would say without equivocation that the accounting profession
would have been better off if CFOs Andy Fastow, of Enron,
Scott Sullivan, of WorldCom, and Mark Swartz, of Tyco International,
had never entered it. I would be much happier if they had
never been recruited in an attempt to draw in “the
best and the brightest.”
the accounting profession lacks is a strong attraction to
the good person who also happens to be exceptionally bright.
This was not historically true, but the profession’s
focus on individual success has undermined its historical
commitment to two things: truth-telling and restraining
unethical behavior. Instead, CPAs in recent years have provided
the impetus for many of the major frauds that resulted in
Sarbanes-Oxley. Even when the CEO can credibly deny complicity,
the CFO is almost always implicated. In the case of HealthSouth,
five different CFOs were complicit in the fraud. Competence
has trumped integrity in the accounting profession.
that the best solution is not to recruit “the best
and the brightest,” but rather to recruit “the
good and the bright.” By “good” I mean
individuals with important virtues like honesty, individuals
committed to doing the right thing and restraining liars.
These people will contribute significantly to the capital
markets by their goodness and by their relentless pursuit
of those who mislead investors. And they will not have to
work for the SEC to do so; they will be corporate accountants,
controllers, auditors, and CFOs.
that there is a subset of bright young people today who
are looking for something meaningful to do in business,
not just for personal enrichment. But when the accounting
profession refuses to offer this alternative, it is rational
for bright young people to instead do something that will
make them richer faster.
Ethics to Differentiate the Profession
National Association of State Boards of Accountancy (NASBA)
has recommended that everyone sitting for the CPA exam take
one college course in business ethics and one in accounting
ethics. Most accounting professors are opposed to this because
of curriculum constraints and the sense that these courses
have little effect. But it sends a signal that the accounting
profession is different, a message that may be helpful in
attracting a new generation of people committed to truth-telling
and to public protection in the capital markets. The courses
could probably be worked into the curriculum, particularly
because almost all states require 150 semester hours of
college course work to become a CPA. But in light of the
strong institutional opposition such a proposal would trigger,
I expect that any such initiative would fail.
that will be a shame. Good luck to the accounting profession
in trying to outrecruit the top MBA programs for the best
and the brightest. What we have to offer is clearly second-rate
if all we have to offer is money.
we could be different. And if it were up to me, we would
be. You keep the best and the brightest. I’ll take
the good and the bright.
K. Shaub, PhD, CPA, is the Emil C.E. Jurica Professor
of Accounting at St. Mary’s University in San Antonio,
Texas. His e-mail is firstname.lastname@example.org.