In South Africa, we suffer from the opposite problem: chartered accountants are fetishized in the business world, far more than MBAs even.
They dominate the leadership of big business and the CA(SA) designation, especially for a black African is a golden ticket to opportunity and a huge salary. Our youngest and brightest minds aspire to be accountants, rather than engineers. It may not be a coincidence that South African business is sometimes accused of having a lack of flair and imagination.
I started off at Wits University (Johannesburg, South Africa) aiming for a BCom Accounting, the path towards being a Chartered Accountant. It definitely was the path towards gold.
(And access to cutting edge technology, I remember a friend of mine showing me his new portable computer - in 1993ish, two black padded canvas bags, one containing an all-in-one Mac, the other a portable printer. It was the first time I saw a Mac.)
I was quickly disillusioned by the field, from high school days Accounting was something that appealed to my asperger-like tendencies - a mathematical model of a business, a true answer to the health of the business.
But in a university level it rapidly devolved into picking apart legal statute to find ways of tax avoidance. A game to hide as many debits into pseudo-equities like "Goodwill". That appalled me. I know tax avoidance is legal, but it conflicts with what I believe to be fair and acceptable. That only worsened when I started job interviewing with accounting firms, including Arthur Andersen.
When I see debacles like WorldCom and Enron, I'm not really surprised. And now, tax avoidance schemes like the Double Irish, and the Dutch Sandwich, I'm thankful I am not in that profession.
> But in a university level it rapidly devolved into picking apart legal statute to find ways of tax avoidance. A game to hide as many debits into pseudo-equities like "Goodwill". That appalled me. I know tax avoidance is legal, but it conflicts with what I believe to be fair and acceptable. That only worsened when I started job interviewing with accounting firms, including Arthur Andersen.
Why don't you use your skill to develop a taxation system for which you can formally prove that you can't do such sketchy tricks for tax avoidance? A kind of dual (in the sense of mathematical optimization) to accounting: If accounting is (among other things - of course) about finding dirty tricks in the taxation system for tax avoiding, co-accounting shall be about developing taxation systems where it shall be (formally provable) impossible to apply dirty tricks for tax avoidance.
That's an interesting idea, but it could be a bit of a stretch. Dutch Boers, later called Afrikaners tended to aspire to be farmers, rather than merchants. In the last 65 years or so, Afrikaners did move into the big business world, but that was a nationalistic reaction to the economic dominance of English-speaking whites.
If I had to hazard a guess, I'd say that the rise of the CA as CEO has to do with the complex conglomerates that were created during the apartheid era. Companies had limited expansion opportunities, so they'd use their capital in unrelated businesses. South African Breweries, for example owned a large supermarket chain. The focus on the bottom line in these complex conglomerates rather than a specific business was presumably a great fit for bean counters. And even though the era of great unfocused conglomerates has ended as expansion opportunities opened up when apartheid ended, CAs were deeply entrenched in the corporate world, and the phenomenon of CAs on top has continued.
As a counter argument out of all the C__ officers the accountant is most likely to actually understand the business. It's not uncommon for companies to focus on effectively irrelevant part's of their business.
>the accountant is most likely to actually understand the business
This is where conflicts arise... the accountant is most likely to know which parts of the business are currently generating profit but, depending on the business, may not be very adept at understanding why certain parts are more profitable or the longer-term position of the company within its markets.
You wouldn't want an accountant to be CEO of the typical software start-up, for example.
(I actually partly qualified as an ACA many moons ago before abandoning it...)
Chartered accountants are also much respected in the UK. It is a very common route to senior management, similar to legal qualifications or an MBA in the US.
While I am certainly biased (CA) I can point out that a number of MBA graduates I have dealt with certainly weren't on the same level(In Business terms) as the CA's I have. Of course there are exceptions to any rule but I would argue that seeing as becoming a CA in South Africa is very difficult (7 years all in) it means something to actually have achieved it. Achieving the "same" qualification in many other commonwealth countries takes between 4 to 5 years.
You make a valid point though in terms of our business standing but I would argue that it is not entirely without merit. I attended a road show by UCT's Graduate School of Business once. I asked them their figures in terms of earning potential after graduating with an MBA and quickly realised that it wasn't any higher than that which I could earn as a CA. In many cases it was lower.
Saying that it is no coincidence that South African Business have a lack of flair is subjective to say the least. I would also like to point out that the JSE has out-performed it's international peers in dollar terms over the last few decades. This was certainly affected to some degree by these boring and unimaginative bean counters you so easily deride.
I know a lot of CAs (as well as people who failed at Honours and/or board exams), and they are very bright, and for the most part fairly interesting personally (and always sure to split the bill accurately). But for a bad matric accounting teacher, who put me off the field, I would probably have opted to study financial accounting as well, with a view to becoming a CA. Also there is no denying that South African corporate governance is very good, in large part due to CAs.
However, you may be confusing correlation with causation.[^] South African CAs are good at business because they are intelligent -as you point out they need to complete 7 years of grueling accounting theory and practice-not necessarily because they have the CA(SA) credential. They'd probably do just as well academically if they studied mathematics, computer science, biology, statistics or engineering. It's no coincidence that kids who are good at school mathematics are told to become chartered accountants in SA, since maths ability is a marker for intelligence. My main worry about accountants having a strong lobby, and accounting becoming the main route to megabucks in SA is that it devalues other professions and draws the brightest minds away from other fields - as you yourself point out ,a person with an undergraduate degree and an MBA is likely to make less money than a CA. Incidentally, I Googled this article that makes a similar argument: http://johanfourie.wordpress.com/2013/05/25/why-and-what-to-...
[^] Anecdotally, BCom statistics is viewed as one of the tougher courses at university by those who take it, but easy compared to the statistics done by science and engineering students (just yanking your chain here).
There's a gem of a quote in that article:
"If Einstein was born in South Africa, he would probably have studied accounting. I’m not sure that he – or South Africa and the world at large – would have benefited much from such an arrangement."
I agree with your sentiment. As a profession it does attract the brightest in this country and not necessarily for the better. I was merely trying to point out that the trust placed in CA's in South Africa is not entirely misplaced. Some would argue that the rigorous education a CA receives in South Africa is at least on par with that of an MBA though possibly more narrow before the more recent changes.
In my opinion, arguing that the standing of CA's in South Africa devalues other professions is very much the same as the age old argument of business in general drawing the brightest minds away from academic subjects. People motivated by money will often choose the route more likely to result in more money. At this point it very quickly devolves into an argument about the current form of capitalism in this country (and the world) and how it incentivises the wrong things - an argument I'm definitely not qualified to have. Thankfully not everyone is motivated by money and there are still people out there willing to do what they love or are good at.
They dominate the leadership of big business and the CA(SA) designation, especially for a black African is a golden ticket to opportunity and a huge salary. Our youngest and brightest minds aspire to be accountants, rather than engineers. It may not be a coincidence that South African business is sometimes accused of having a lack of flair and imagination.