“I am a Chartered Accountant (CA). Why am I struggling to get into McKinsey, Bain and BCG?”
This is a great question and surprisingly very common from British, South African and Australian candidates. This posting was prompted by a British graduate who immigrated to the US and is trying to join a consulting firm. We have been asked this question a few times before so it is worth answering it here for all our readers.
The Chartered Accountancy (CA) designation is a prized and much sought after qualification in several of the former British colonies, now Commonwealth countries. The CA designation is mistakenly called a degree when it is actually not. It is not a degree since the candidate needs to obtain a Bachelor’s degree in commerce or accounting and then serve an internship (called articled clerk) before sitting for another exam and finally receiving the CA designation. If you lived in South Africa, Britain and to some extent Australia the CA could be a route to great riches. There is a reason for this.
As much as the British do not like to admit it, they arrived on the MBA scene fairly late. British MBA’s are not held in the same standing as their US, Canadian or even continental European peers. A Harvard, Wharton, Sloan, Stanford, Yale, Columbia, Duke or INSEAD MBA is held in much greater standing. With the exception of LBS, not many of the other British schools are even well known. Even LBS is not well known. Of course, the schools would argue this is not true but a cursory check on Google or a discussion with a pool of prospective MBA candidates would support this view. How many of you can name and spell Oxford’s business school? I think I made my point.
The late arrival of MBA programs to British universities meant that aspiring CEO’s needed to obtain their training somewhere else. Usually this was via the CA designation. Many British CEOs hold CA’s and served as financial directors before progressing onwards to their current positions. This is slowly changing, but the MBA is still not held in the same regards as it is held in the USA. Of course, management consulting firms originating from the US and operating in London think differently.
If you want to see a perverse example of this, then look no further than South Africa. Due to a host of issues including international isolation, South Africa was very late in developing MBA programmes. A search of the country’s top business executives indicates that over 65% hold the CA designation. Less than 5% hold an MBA. South African MBA’s are also not widely regarded worldwide and only a few even make it into the FT.com rankings. None feature in the Businessweek.com rankings. To get to the top of business in South Africa, it probably helps to have a CA. However, again, it will not help with the top consulting firms. A quick call to McKinsey’s London and Johannesburg offices confirms this. McKinsey makes no special effort to recruit CA’s and CA’s compromise less than 3% of both offices. Calls to Deloitte’s, E&Y’s, KPMG’s and PWC’s London and Johannesburg offices painted a different picture. They love CA’s. Of course they would; they are auditing firms and not top consulting firms.
A number of reasons have driven this bubble for the CA designation in Britain and South Africa. For one, both countries were really late to embrace the view that management is a science. Both countries felt that understanding the accounting statements made one an expert in business. If you could read the accounting statements, that was all that was needed. A CA designation is a qualification which trains one to be an auditor. An auditor’s job is to reconcile the accounting statements and make sure everything is as stated. That’s it, nothing more. If it is GAAP compliant, the job is done.
CA’s are not trained to understand business. That is a critical point. CA’s are trained to spend years understanding the minutiae of a business. Therefore, in time, they understand a sector in great depth. You are probably wondering why a top consulting firm will not value this. That is because consulting firms value the ability to solve problems rather than having/applying a pre-existing knowledge base. CA’s are linear thinkers who solve linear problems. Applying MECE, decision trees and hypotheses is not a linear process. Most solutions to consulting problems do not lie in the financial statements. The statements outline the symptoms of a problem, but it takes time and effort to find the real issues. Something a CA is not trained to do.
In the US, a certified public accountancy (CPA, and CA equivalency) designation will allow you to, at most, serve as the financial controller. There is no way a major US enterprise will allow someone without an MBA to serve as CEO or CFO.
I must add that CA’s are not common in management consulting in the top firms. We have personally never met a CA who served as a partner at McKinsey, Bain or the BCG. I am sure they exist, but they are in the minority. If you think we are kidding about the lack of CA’s in management consulting go to the alumni sites of McKinsey, Bain or the BCG and see how many CA’s are featured; None. That is not to say that someone with a CA cannot become a management consultant. You can. If you have the correct problem solving skills, right values and attitude then you can make it and be a successful management consultant. However, walking into an interview and assuming a CA designation is a gold standard is not just arrogant, it shows a total lack of understanding of business. You will not go beyond the first round.
McKinsey, Bain and the BCG will still look for talented graduates and MBA’s to join their offices; even in Britain or South Africa (although BCG does not have a South African office). If you have a CA, and are unwilling to learn the proper management consulting techniques or retrain then you should consider going into a corporate role in either country or joining an auditing firm. Auditing firms like Deloitte, E&Y, KPMG and PWC usually staff their consulting leadership ranks from the accounting side of the business. The exception is obviously in the US side off the business where this would never work. The consulting leaders must have MBA’s.
CA’s do have one slight advantage. The CA designation is uniform. A graduate from any university is treated the same if they have the designation since the CA is administered by the same body. That is why there is no global CA ranking. MBA’s are different. It really matters which school you attended. That said this will only help a CA if they choose to join the consulting arms of the accounting firms. And then, it will only help if you have no intention of immigrating or working on international assignments. If you transferred from PWC Consulting London to PWC Consulting New York, you had better have an MBA
For those who have a CFA, this entire discussion about the CA is applicable to you. The CFA was designed for financial analysts and not management consultants. It is like a CA but focused more heavily on financial analyses. It does not teach management/business analyses. There is furthermore a reason why an entry level McKinsey hire is called a business analyst. Analysing a business is the most basic skill you need in a consulting firm. It is not all the skills you need. If you have a CFA, then expect to struggle just as much as the CA to get in. You need to get an MBA or another graduate degree since elite management consulting firms are looking for people who can solve problems.
What would we recommend for a chartered accountant who actually wants to get into management consulting?
- Accept that your designation is giving you no greater advantage than someone without another graduate degree or no business degree.
- Understand that your designation may put you at a disadvantage since the interviewer will likely think that you believe you have all the required skills.
- Be prepared to buckle down and learn the correct way to solve consulting case problems.
- Accept that you will likely need to study for an MBA to be successful and/or make partner.
If this came across in a direct manner, we apologize. We felt it is important you get the right information and did not want to unnecessarily raise your expectations. You need to know where you stand to make the right career choices. Your future is far too important to rely on inaccurate information. That said; every candidate is different. If you have questions, please do not hesitate to write to us.
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