How will Janet Truncale make her mark at EY?

As the new global chief executive of the Big Four accounting firm EY, Janet Truncale inherits a complex legacy – one shaped by the failed “Project Everest” plan to split the firm’s audit and consulting practices.

With the ghost of Everest still looming, Truncale must chart a new course for the organisation, reconciling the competing interests and tensions that have long simmered within EY’s global leadership.

The collapse of the Everest plan in April 2023 was a major blow to EY, costing the firm an estimated $500 million. It also precipitated the departure of Carmine Di Sibio, EY’s global chair and CEO, who had been a driving force behind the controversial restructuring. His exit paved the way for Truncale’s ascension, as she was tapped to take the reins from Di Sibio, officially assuming the top job on July 1st.

Truncale’s elevation was not without its critics, however. Some within EY’s global executive committee had reservations about her ability to win the support of US leadership, particularly that of Julie Boland, the then-EY US chair who had expressed concerns about the Everest plan.

Truncale’s Mandate

In her first public statement as the new global CEO yesterday, Truncale launched a new global strategy for the firm, setting out “bold ambitions to create new value for EY clients, people and stakeholders.”

And in a memo to staff, first reported by the Financial Times, she “recommitted to working together as one organisation and that her new leadership team planned to simplify how EY operated.

Truncale’s new strategy, dubbed “All in,” will harness the multi-disciplinary expertise of the firm’s 400,000-strong global workforce.

This holistic approach represents a departure from the narrower, more siloed focus that had characterized EY’s operations under Di Sibio’s leadership.

One of Truncale’s key priorities in the coming months will be to slim down EY’s central bureaucracy. This move is likely to be welcomed by many within the firm, who had grown frustrated with the layers of red tape and decision-making bottlenecks that had emerged.

By streamlining the organisation, Truncale hopes to empower EY’s regional and local leaders, allowing them greater autonomy and flexibility to respond to the unique needs of their markets. This decentralised approach could help the firm become more agile and responsive in an ever-changing business landscape.

Addressing the Talent Pipeline

Another key challenge facing Truncale is the issue of EY’s talent pipeline. Like a large share of accounting firms, demand from clients has seen the skill sets now require of accountants shift markedly.

Along with other firms in the Big Four, EY has made job cuts to try and manage waning demand for certain services while continues to invest heavily in L&D. Accountancy Age understands Truncale will continue to promote internal talent nurturing alongside the firms’ broader goal of creating new value for its people.

Rebuilding Trust and Credibility

Perhaps Truncale’s most daunting task will be to rebuild trust and credibility within the EY ecosystem – both internally and externally. The Everest debacle had shaken confidence in the firm’s leadership, and Truncale will need to work tirelessly to regain the trust of clients, regulators, and her own workforce.

This will likely involve a concerted effort to improve transparency and communication, as well as a renewed focus on delivering high-quality services and solutions that address the evolving needs of EY’s diverse stakeholders. Truncale will need to demonstrate that she is a steady, trustworthy steward who can guide the firm through this period of transition and uncertainty.

Navigating Regulatory Scrutiny

As Truncale settles into her new role, she will also need to navigate the complex web of regulatory scrutiny that has long surrounded the Big Four accounting firms, including EY. The industry has faced heightened scrutiny in recent years, with concerns raised about audit quality, conflicts of interest, and the potential risks posed by the firms’ diversified service offerings.

Truncale will need to ensure that EY remains compliant with all relevant regulations and industry standards, while also advocating for a regulatory environment that supports the firm’s ability to innovate and adapt to changing market demands. This will require a delicate balancing act, as Truncale seeks to position EY as a trusted, reliable partner to both clients and regulators.

Embracing Digital Transformation

One of the key pillars of Truncale’s “All in” strategy is a renewed focus on digital transformation. The accounting and professional services industry has been undergoing a profound technological shift, with the increased adoption of AI, data analytics, and other digital tools transforming the way firms operate and deliver value to their clients.

Truncale will need to ensure that EY is at the forefront of this digital revolution, investing in the necessary infrastructure, talent, and capabilities to remain competitive in an increasingly tech-driven landscape. This may involve strategic acquisitions, partnerships with leading tech firms, and a concerted effort to upskill the firm’s workforce to meet the demands of the digital age.

Fostering a Culture of Innovation

Alongside the digital transformation agenda, Truncale will also need to cultivate a culture of innovation within EY. The firm’s ability to anticipate and respond to the evolving needs of its clients will be critical to its long-term success, and this will require a nimble, entrepreneurial mindset that permeates the organisation.

Truncale will need to empower EY’s people to think creatively, take calculated risks, and challenge the status quo. This may involve implementing new incentive structures, collaborative work environments, and knowledge-sharing initiatives that encourage the cross-pollination of ideas and the development of innovative solutions.

Strengthening Global Collaboration

As a global firm, EY has long grappled with the challenge of aligning its various regional and local operations. Truncale’s “All in” strategy emphasises the importance of harnessing the firm’s collective expertise and resources to create value for clients, and this will require a concerted effort to foster greater collaboration and integration across EY’s worldwide network.

This may involve initiatives to break down silos, facilitate knowledge-sharing, and streamline decision-making processes. Truncale will need to demonstrate her ability to navigate the complex geopolitical and cultural dynamics that shape EY’s global operations, ensuring that the firm can leverage its worldwide presence to deliver a seamless, consistent experience for clients.

Redefining the EY Brand

As Truncale takes the helm, she will also need to redefine the EY brand, both internally and externally. The Everest debacle had undoubtedly taken a toll on the firm’s reputation, and Truncale will need to work to restore EY’s standing as a trusted, forward-thinking leader in the professional services industry.

This may involve a concerted effort to communicate the firm’s new strategic vision, highlighted by the “All in” mantra, and to showcase the innovative solutions and services that EY can deliver to its clients.

Truncale will also need to ensure that the firm’s values, culture, and people are aligned with this new brand identity, creating a cohesive and compelling narrative that resonates with both internal and external stakeholders.

Navigating Geopolitical Tensions

Finally, Truncale will need to navigate the complex geopolitical landscape that has increasingly shaped the operating environment for global professional services firms like EY. Tensions between the US and China, the ongoing fallout from Brexit, and the lingering effects of the COVID-19 pandemic have all created significant challenges for firms seeking to operate seamlessly across borders.

Truncale will need to demonstrate her ability to anticipate and respond to these geopolitical shifts, ensuring that EY can continue to serve its clients effectively while also managing the regulatory, financial, and operational risks that come with operating in a volatile global environment. This will require a keen understanding of the political, economic, and cultural factors that influence the firm’s various markets, as well as a willingness to adapt and pivot as the landscape continues to evolve.

Conclusion

As Janet Truncale assumes the reins at EY, she faces a daunting set of challenges – from rebuilding trust and credibility, to navigating regulatory scrutiny, to fostering a culture of innovation and global collaboration. Yet, with her extensive experience and a clear strategic vision, Truncale is well-positioned to make her mark on the firm and chart a new course for its future.

The road ahead may be fraught with obstacles, but Truncale’s “All in” approach, which emphasises the collective expertise and resources of EY’s global workforce, could prove to be the key to unlocking the firm’s full potential.

By streamlining the bureaucracy, nurturing talent, and embracing digital transformation, Truncale aims to position EY as a nimble, forward-thinking leader in the professional services industry – one that is poised to thrive in an ever-changing business landscape.

Ultimately, the success of Truncale’s tenure will hinge on her ability to navigate the complex web of internal and external forces that have long shaped EY’s trajectory. But with a clear vision, a steadfast commitment to excellence, and a willingness to adapt and innovate, she may just be the leader the firm needs to emerge from the shadows of Everest and forge a bold, new path forward.

This article has been amended. The original version incorrectly attributed quotes to Janet Truncale and misinterpreted information from a source.