• KPMG US joined other Big Four firms in pulling back on DEI initiatives, per an internal memo seen by BI.
• Its US arm is ending a strategy intended to recruit and retain staff from underrepresented backgrounds.
• Paul Knopp, chair and CEO of KPMG US, told staff it remained "unwavering" in its commitment to inclusivity.

KPMG US has ended a DEI talent strategy that was set up amid the 2020 Black Lives Matter protests, becoming the latest Big Four professional services firm to roll back diversity initiatives since Donald Trump's reelection.

"The legal landscape surrounding diversity, equity, and inclusion efforts has been shifting, via executive orders and in the courts," Paul Knopp, chair and CEO of KPMG US, told US partners and employees in a memo sent on February 14 and seen by Business Insider.

Knopp said that KPMG US would bring its "Accelerate 2025" program to a close and reevaluate "associated programming and talent initiatives."

A person familiar with the matter said the firm would end its use of forward-looking metric-based aspirations based on protected categories such as race or gender.

KPMG has also removed annual DEI transparency reports that tracked progress on diversity from its website. A person familiar with the matter said the firm was making sure that the website accurately reflected current policies and programs.

The changes were first reported by The Financial Times.

Knopp told the US workforce that the firm remained "unwavering in our commitment to fairness and inclusivity."

Launched in 2020, KPMG's Accelerate 2025 strategy aimed to boost diversity in recruitment and retention. The aim was to help the firm reach a target of having 50% of managing partners and managing directors from underrepresented backgrounds by 2025.

KPMG's financial year, and the point at which it measures earnings and progress data, ends on September 30.

Knopp presented the strategy in a LinkedIn post published on Juneteenth in 2020, saying that Accelerate 2025 would help ensure "the firm and the firm's leaders look a lot more like America."

"We also commit to publishing relevant information so that our people and the public can hold our feet to the fire," he said.

A report that remains available on KPMG's website states that in September 2023, 45.3% of US partners and managing directors came from under-represented groups such as women, racial minorities, and LGBTQ+ individuals.

In January 2024, Knopp told Quartz that "24% of our partners are women. Only a little more than 2% are Black. We're not at the same level of representation in the country for Black and Latino/Latina Americans — we're not even close."

KPMG declined to comment.

KPMG joins a growing list of major companies, many of whom expanded diversity initiatives following the Black Lives Matter protests in 2020, that are now rolling back on DEI in line with changes introduced by the Trump administration.

On his first day in office, the president signed an executive order to end diversity programs across the federal government and ordered all federal DEI staffers to be placed on leave while their departments were disbanded.

Trump's Attorney General, Pam Bondi, instructed the Department of Justice to "investigate, eliminate, and penalize" any "illegal" DEI programs at private sector companies and universities that receive federal funds.

"We will continue to uphold the highest ethical standards and fully comply with all applicable laws and regulations, including adherence to the executive orders affecting us as a federal contractor," Knopp said in the memo.

KPMG receives $406 million annually through its contracts with federal agencies, over half of which are with the Department of Defense.

A KPMG US employee, who did not want to be named as they were not permitted to speak to the media, said that Knopp's memo "hasn't really been a point of frustration."

"They've done a really good job of hosting Q&As and trying to reassure people who think this is going to not be inclusive anymore," the person said.

Fellow Big Four competitor Deloitte has also scrapped DEI programs, telling staff in an internal memo that the changes were made "to remain fully compliant with federal laws."

Do you work at KPMG or another consulting firm? Contact this reporter in confidence at [email protected] or on Signal at Polly_Thompson.89

• Many big companies are pulling workers back to the office 5 days a week.
• The Big Four — EY, Deloitte, PwC, and KPMG — are sticking with hybrid work policies.
• Here's where the Big Four stand on hybrid work in 2025.

The world's four largest consulting and accounting firms collectively employ 1.5 million staff and take up prime commercial real estate in hundreds of major cities worldwide.

But all four firms are bucking the trend toward stricter return-to-office (RTO) policies being followed by other corporate powerhouses.

Companies including JPMorgan, Dell, AT&T, and Amazon have reversed their stance on remote work and called employees back to the office five days a week.

Federal workers have also been called to return to their offices full-time after President Donald Trump signed an executive order mandating RTO on his first day in the White House.

Business Insider spoke to the Big Four about where they stand on hybrid work in 2025.

KPMG

KPMG operates a hybrid working model, with employees splitting time between the office, client sites, and home. The firm has permitted some hybrid work since before the pandemic.

The exact number of days teams come to the office is at the discretion of each member firm within the KPMG network.

"This approach centers on trusting our people to responsibly manage their working patterns to deliver the best results for clients, as well as their teams," Nhlamu Dlomu, KPMG's international global head of people, told Business Insider.

Some 81% of participants in KPMG's 2024 Global People Survey agreed with the statement, "I can work where I am most effective to meet client, business, and team needs."

KPMG says it continually assesses working practices to find the right balance between flexibility and building strong in-person relationships at work. It says it aims to hold regular team-building and social activities to support a healthy work environment.

"There's no doubt that one size does not fit all when it comes to ways of working — different organizations will have different approaches," said Dlomu.

"But, it's important for organizations to reflect on what they have gained from remote and hybrid work and what they may risk by introducing blanket mandates."

EY

EY's hybrid work policy encourages staff to work in the office two to three days a week, with the flexibility to work from home for the remaining days.

There is no single global policy on how often employees should come to the office. The number of days is at the discretion of member firms in each region.

"Globally our principle is that people work where and when they are most effective, with individual office policies set by member firms," an EY spokesperson told BI.

In January 2024, reports emerged that senior employees at the UK branch of EY were monitoring how often staff attended its offices by tracking turnstile access data. Reports at the time suggested that at least 50% of staff on some teams were flouting the two-day-a-week rule.

EY's spokesperson told BI it recognized the importance of flexibility in enabling productivity, collaboration and meeting client needs. EY believed it is important to develop "a network of workplaces, including offices, home working, coworking and meeting client preferences and policies," they said.

They added that EY continuously assesses workforce preferences to evolve its approach and create the best work experience.

PwC

PwC's policy allows hybrid employees to spend roughly 50% of their time in-person at either a client site, PwC office, or other in-person location, depending on their team and client.

The firm's UK arm has cracked down on hybrid working in recent months, however.

In January 2025, PwC tightened up its hybrid work approach in the UK by mandating staff work in the office or with clients at least 3 days a week, or 60% of their time. Previously, the UK workforce was expected in the office at least two days a week.

The firm told its 26,000 UK employees that it will also begin monitoring how often employees work from home, The Financial Times reported.

"Face-to-face working is hugely important to a people business like ours, and the new policy tips the balance of our working week into being located alongside clients and colleagues," said Laura Hinton, managing partner at PwC UK.

"At the same time, we continue to offer flexibility through hybrid working," she said.

PwC's policy in the US remains unchanged.

Deloitte

The golden rule at Deloitte is that "people are trusted to decide how they work," the firm states on its website.

Deloitte, which is the largest of the Big Four by both employees and revenue, has allowed some hybrid work since 2014. The firm made its hybrid-working policy official following lockdowns during the pandemic.

Deloitte does not mandate a set number of days in the office. Instead, the consultancy lets employees judge when to spend time between client sites, the office, and home.

When teams or clients require their presence, employees are encouraged to make every effort to be present in person.

Deloitte believes hybrid work is a tool for boosting employee experience and satisfaction, BI understands. The firm thinks employers who recognize the desire for flexibility and choice are more likely to attract, retain, and motivate the best talent.

Do you work at KPMG, PwC, Deloitte, or EY? Contact this reporter in confidence at [email protected] or on Signal at Polly_Thompson.89 with any tips. You can remain anonymous.

• Deloitte US has made a series of changes to its DEI practices, according to internal memos seen by BI.
• The moves include telling staff working on government contracts to remove pronouns from email signatures.
• Deloitte's UK chief told staff that the firm remained "committed" to diversity goals in the UK.

Deloitte has told some staff to remove pronouns from their email signatures.

The move by the world's largest professional services firm comes amid a pullback on its diversity programs in the US that is not being followed by the UK division.

"We will sunset our workforce and business aspirational diversity goals, our Diversity, Equity, and Inclusion (DEI) Transparency report, and our DEI programming," Doug Beaudoin, Deloitte's chief people officer, told employees in an email sent on Monday and seen by Business Insider.

He wrote that the changes followed "a detailed review of all pertinent government directives to ensure we comply with their requirements, both as a private enterprise and as a government contractor." That review was in line with "others in the marketplace."

"Everyone is welcome at Deloitte," Beaudoin emphasized in bold text in the email.

The memo comes a week after Deloitte asked workers in its Government & Public Services division, which serves the public sector, to remove pronouns from their email signatures.

In a February 5 memo seen by BI, staff in that division were told to update their email signature template "to align with emerging government client practices and requirements."

"Please note that the template is limited to name, role information, and business contact information. Any other personal information, including quotes, taglines or pronouns, should not be included," the directive said.

Government & Public Services workers have a "longstanding commitment to compliance with US government requirements," the memo said.

The memo about the email signatures was first reported by The Financial Times.

While the changes to DEI programs apply to Deloitte's 173,000 US employees, its UK operation remained "committed" to diversity goals and would continue to report annually on its progress on inclusion.

The comments were made in a memo sent on Tuesday by Richard Houston, senior partner and chief executive of Deloitte UK, and seen by BI. Houston said he was sending the memo in response to media coverage of the US DEI changes.

"Events in the external landscape do not change our commitment to building an inclusive culture and helping all our people to reach their full potential," he wrote.

Addressing Deloitte US's changes on DEI, Houston told the UK workforce that leaders had "been clear that this reflects the need to remain fully compliant with federal laws."

On his first day in office, President Donald Trump signed an executive order to end diversity programs across the federal government and ordered all federal DEI staffers to be placed on leave while their departments are disbanded.

Last week, Trump's Attorney General, Pam Bondi, instructed the Department of Justice to "investigate, eliminate, and penalize" any "illegal" DEI programs at private sector companies and universities that receive federal funds.

Deloitte receives $3.2 billion annually through its contracts with federal agencies, including the Departments of Defense and Health and Human Services.

A Deloitte employee in the GPS division, who did not want to be named as they were not permitted to speak to the media, told BI the email signature request was made to "minimize potential risk exposure" and "maintain goodwill" with the White House.

"Deloitte is taking the 'better to be safe, than sorry' approach here," the person said.

Deloitte has already clashed with the MAGA movement after one of its employees was revealed to have leaked messages sent by now-Vice President JD Vance in 2020 that were highly critical of Trump to The Washington Post.

In September 2024, Donald Trump Jr. posted the name of the Deloitte executive accused of leaking messages on X.

"Deloitte also gets $2B in govt contracts. Maybe it's time for the GOP to end Deloitte's taxpayer funded gravy train?" the president's son said.

The Big Four firm joins a growing list of companies, including Meta, Walmart, and Target, that have rolled back their DEI policies in recent months.

Last week, fellow consulting giant Accenture told staff it was revising its DEI policies. The consultancy chose similar phrasing to Deloitte, telling staff in an internal memo that it was "sunsetting" existing goals and programs.

Deloitte did not immediately respond to a request for comment from Business Insider.

Do you work at Deloitte? Contact this reporter in confidence at [email protected] or on Signal at Polly_Thompson.89 to share your thoughts on these changes. You can remain anonymous.

• The Chinese branch of PwC has cut down its partner class by over 60 in recent months.
• The decrease in partners follows PwC's record fine and a six-month suspension of operations in China.
• The firm's business fell in the Asia-Pacific region last year, with particularly slow growth in China.

Over 60 partners have stepped down from their roles at PwC's China division as the firm handles the aftermath of its involvement in the Evergrande Scandal.

The number of partners at the mainland Chinese arm of PwC has recently fallen by 66, according to filings from December and January with the Unified Supervision Platform of the Chinese CPA Profession, a regulatory platform.

Four new partners were registered in December, the filings also show.

"Over the past several months, PwC China has been reshaping its business to continue our focus on delivering the best quality services for our clients," a PwC China spokesperson told Business Insider.

"As we have gone through this process some partners have retired from the firm," the spokesperson said.

The Financial Times first reported on the partners standing down.

The decrease in partner numbers comes as PwC deals with the fallout of its involvement in the Evergrande scandal. In September, the firm was found to have helped conceal fraud at the now-collapsed Chinese property developer Evergrande by issuing false audits.

"PwC has seriously eroded the basis of law and good faith, and damaged investors' interest," the commission investigating PwC's involvement said.

Evergrande, which collapsed in January 2024, was accused of inflating its revenues by $78 billion in 2019 and 2020 — one of the largest fraud cases in history.

The Chinese government fined PwC around $62 million and removed its license to operate in the country for six months. 11 employees were fired or left the company, and state-owned enterprises have since dropped PwC as their auditor.

Mohamed Kande, PwC's global chairman, said the findings of the Evergrande audit were in "stark contrast" to the high-quality work PwC produces and were not representative of what the firm stands for.

The Big Four accounting firm has been battling to retain business in the region following the scandal. In October, PwC reported a 12.7% decline in net income for the Asia-Pacific region for the financial year ending in June.

The firm said demand was particularly slow in China, where revenue fell.

• Citigroup's CEO, Jane Fraser, has emphasized hybrid work, saying she views it as a recruitment tool.
• Employees can keep working two days a week remotely, she told executives.
• Other Wall Street titans, like JPMorgan and Goldman Sachs, have enforced strict RTO mandates.

Since pandemic restrictions lifted, Wall Street's biggest names have been leading the charge to get employees back to their desks. But Citigroup is standing firm behind its hybrid work policy.

The bank will continue to allow most employees to work from home two days a week, the US bank's chief executive Jane Fraser told executives during a quarterly call in mid-January, the Financial Times reported.

The majority of Citi employees are required to be in the office three days a week and can work remotely for two days. Bank branch employees and most traders are required to be in the office five days a week.

On the call, Fraser reportedly said that offering hybrid work gives Citi an advantage over its competitors and could be a recruitment tool to draw in employees, the FT first reported and Business Insider has confirmed.

Fraser has previously characterized working from home as a privilege, not a right. At the 2023 World Economic Forum in Davos, Switzerland, she said the bank was calling workers with productivity issues back to their desks.

Even as Fraser doubles down on hybrid work at Citi, the bank is spending big on new office space.

Citi is spending £1 billion ($1.2 billion) to renovate its London office into a "workplace for the future." The Citi Tower in Canary Wharf is due to open in 2026.

Citi's approach is less strict than most of its Wall Street competitors.

Goldman Sachs was one of the first banks to re-introduce five days a week in the office. CEO David Solomon called remote work an "aberration" in 2021.

By 2022, JPMorgan had roughly 50% of employees back in the office five days a week. This January, it announced that it was ending hybrid work and bringing all workers back to the office starting in March.

"We know that some of you prefer a hybrid schedule and respectfully understand that not everyone will agree with this decision," the bank said in a memo, adding, "We think it is the best way to run the company."

A company spokesman said that roughly 70% of the bank's employees were already back in the office five days a week.

The bank's RTO push comes as JPMorgan prepares to open a newly refurbished global headquarters at 270 Park Avenue by the end of 2025. With space to house up to 14,000 employees, the building will set "new standards for employee wellness and hospitality," according to a press release.

• Dell is calling its global workforce back to the office full time, per a memo obtained by BI.
• In September, the company told its sales teams to be in the office five days a week.
• "Nothing is faster than the speed of human interaction," CEO Michael Dell told staff in the email.

Dell is calling an end to hybrid and remote work.

In an email sent on Friday morning, CEO Michael Dell said that from March the company would expect all employees living within an hour of offices to be at their desks five days a week.

"Starting March 3, all hybrid and remote team members who live near a Dell office will work in the office five days a week. We are retiring the hybrid policy effective that day," the CEO, who has a net worth of $117 billion, told staff.

According to the email, which BI exclusively obtained, employees who live far from a Dell office will be allowed to continue working remotely.

"What we're finding is that for all the technology in the world, nothing is faster than the speed of human interaction," Michael Dell told staff. "A thirty-second conversation can replace an email back-and-forth that goes on for hours or even days."

The CEO acknowledged that staff would have questions.

"Please hold those for now," he said. "We're still working through details, and additional information will be available soon."

BI understands that leaders at Dell will be able to ask for exemptions for their team members.

Most offices have capacity for all workers to return in March, but in the few cases where space was limited, Dell will provide guidance in the coming month, BI understands.

"We continually evolve our business so we're set up to deliver the best innovation, value and service to our customers and partners. That includes more in-person connections to drive market leadership," a Dell spokesperson told BI.

Dell has already implemented a five-day return-to-work policy for some parts of its business.

In September, the company sent a memo to its entire global sales team informing them they would be required to work in the office full time.

Manufacturing teams, engineers in the labs, onsite team members, and leaders had also already been asked to be in the office five days a week.

Parents at Dell told BI that the September five-day mandate had left them scrambling to find childcare arrangements, while other sales staff said there was a shortage of parking spots and desks — a common logistical challenge for companies implementing RTO.

Vivek Mohindra, Dell's senior vice president of corporate strategy, told BI in December that the company had seen "huge benefits" from bringing the sales team back to the office and that the energy on the sales floor had been "very different" since the policy was introduced.

The company, which sells PCs and enterprise technology such as servers, asked its more than 100,000-strong workforce to classify as either remote or hybrid in February 2024.

Last year, BI obtained internal data showing that close to 50% of Dell's full-time workers in the US initially chose to stay remote, while a third of international staff remained remote. Their reasoning included living far from the office, working in teams spread over different states and countries, and working remotely before the pandemic.

When Dell introduced its initial return to office policy in 2024, it said that workers opting to stay remote would not be considered for promotion, or be able to change roles.

Dell joins a growing list of companies, including Amazon, AT&T, and JPMorgan, that have reversed their stance on remote work and now expect employees to be in the office full-time.

Federal workers have also been called to return to their offices full time after President Donald Trump signed an executive order mandating an RTO on his first day in office last week.

Read the full memo below:

Team,

We are building a new Dell Technologies for a new future. The pace of innovation has never been faster, and for us to lead, the speed of our business must continue to accelerate. What we're finding is that for all the technology in the world, nothing is faster than the speed of human interaction. A thirty second conversation can replace an email back-and-forth that goes on for hours or even days.

We've already asked our sales teams, manufacturing teams, engineers in the labs, onsite team members and leaders to be in the office five days a week, and we have seen these areas come alive with new speed, energy, and passion. Now, we want to see that same sense of urgency and drive everywhere.

Starting March 3, all hybrid and remote team members who live near a Dell office will work in the office five days a week. We are retiring the hybrid policy effective that day. We remain committed to flexibility within your workday, and you should continue to work with your manager to meet your needs. But for the most part, you should plan to work in the office five days a week.

If you opted-in for remote work and live near a Dell office, we expect you to join us in the office. If you are remote and live a long distance from a Dell office, you'll stay remote. If you are field, you will continue to spend five days a week with customers and partners or in a Dell Technologies office.

We know you may have questions about what this means for your specific situation. Please hold those for now. We're still working through details, and additional information will be available soon. But I personally wanted to share this news sooner rather than later, so you have time to process and plan.

We continually evolve our business to deliver the best value and service to our customers and partners. I'm excited for us to have more in-person connections to drive speed, market leadership, and an even stronger culture.

I look forward to seeing many more of you in the office. Welcome back!

Michael 

Are you a Dell employee with insight to share? Contact these reporters via email at [email protected] and [email protected], or via Signal at Polly_Thompson.89 and jyotimann.11. Reach out via a nonwork device.

• Partners at KPMG UK were paid an average of just over $1 million.
• The record payday came despite revenues rising by just 1%.
• Partner payouts at the other Big Four firms have been hit by waning demand for their services.

KPMG UK's most senior staff collected record pay packets despite slowing revenue growth.

UK partners received an average of £816,000 (about $1 million) for the year to September 30, the firm said in its annual report released Wednesday.

The 9% rise in partner pay comes as KPMG UK's revenues increased by just 1% to almost £3 billion. That compared with 9% and 16% increases in the two previous years.

The firm's tax and legal division grew 9%, and its audit line was up 5%. That growth was offset by a 4% decline in revenues at its advisory business.

KPMG attributed the contraction to the "backdrop of depressed UK and global deals markets."

Major consulting firms are grappling with waning client demand as they adapt to market changes caused by the pandemic and a tough macroeconomic environment.

"This is a good performance in challenging market conditions," said Jon Holt, group chief executive and UK senior partner, in a statement.

The bonus pot for all employees rose by 20% and about 10% of the workforce were promoted, he said.

KPMG UK had focused on managing costs, Holt said. The firm's pre-tax profit rose by 11% to £404 million, reversing a 20% dip the previous year.

KPMG UK and KPMG Switzerland merged on October 1, creating a new $4.4 billion business that is the second largest in KPMG's global network. It has about 17,000 partners and staff.

Slowing revenue growth at the other Big Four professional services firms — EY, Deloitte, and PwC — has hit the pay of their most senior employees. Partners who hold equity stakes in the Big Four firms traditionally receive a share of annual profits.

At EY and PwC, UK partner payouts declined by 5%, while Deloitte UK say a 4.5% drop in pay.

UK partners at KPMG are now the third best-paid among the Big Four, ahead of EY. Its UK partners received an average of $938,000 in the last financial year.

At PwC, partners received an average of $1.07 million, while at Deloitte, the largest Big Four firm by employees and revenue, average partner payouts were $1.2 million in 2024.

Do you work at KPMG or another Big Four firm? How has your pay or bonus changed in the past year? Contact this reporter in confidence at [email protected] or on Signal at Polly_Thompson.89

• An EY report has underlined that DEI strategies can help boost workforce innovation and improve productivity.
• The report provides recommendations for businesses on how to best implement DEI initiatives.
• It comes a week after President Trump cut federal DEI programs and pushed the private sector to follow.

A new report from the Big Four professional services firm EY has underlined the importance of diversity, equity, and inclusion (DEI) strategies in improving productivity and workforce innovation.

The report, titled "DE&I interventions that deliver," considers the impact of inclusive policies in the context of the "economic slowdown and uncertainty" that have characterized the past few years.

Developed in partnership with leading diversity campaigns and DEI specialists in the UK, it recommends the top approaches for improving DEI in the workplace.

The recommendations include taking a data-driven approach to workforce analysis, targeted recruitment strategies to attract diverse candidates, and providing flexibility on when and how roles are performed.

EY's report comes a week after President Donald Trump rolled back DEI programs for federal government workers during his first week in office. In his executive order, the president encouraged private-sector companies to do the same.

The president wants federal agencies to identify "the most egregious and discriminatory DEI practitioners" across public companies and nonprofits for possible civil investigations.

Target, Meta, Walmart, and other major US companies have been altering or cutting their DEI programs, in line with Trump's messaging.

Others like Costco and JPMorgan are standing by DEI and have publicly defended their diversity initiatives. 61% of Americans support DEI practices, according to a Washington Post-Ipsos poll last April.

"Diversity, equity and inclusion are not just ethical values — they are critical drivers of innovation, productivity, and economic growth," said Anna Anthony, EY's UK & Ireland Regional Managing Partner.

Creating inclusive workplace cultures and amplifying the voices of underrepresented groups creates a business environment "where creativity flourishes, individuals thrive, and everyone benefits," Anthony said.

She said that the findings aimed to provide insight to UK companies, as well as to EY itself.

"The fact that there are questions being asked about the value of diversity and inclusion programmes is a sign, not that we should do less, but that we should do more — and do better," said Sir Trevor Phillips, Chair of Change the Race Ratio, one of the groups that contributed to EY's report.

• GenZ and its expectations for the workplace were a talking point at the World Economic Forum in Davos.
• Excessive screen time has dulled their creativity and attention span, experts say.
• Some business leaders say it's important to meet employees where they are.

Five generations are working side-by-side in offices for the first time, but the youngest cohort is bringing new expectations and boundaries to the workplace that break with traditional conventions employers are used to.

"There's very widespread dissatisfaction and concern about young employees," Jonathan Haidt, a professor at NYU's Stern School of Business and author of "The Anxious Generation," told Business Insider at the World Economic Forum in Switzerland last week.

Countless hours of staring at screens have damaged young Gen Z employees' ability to function well in the workplace, he said.

Many young people are almost constantly using social media, Haidt told BI, which often means they "never have a moment to reflect, they don't have time to mull things over, they don't have time to be creative."

Social media has diminished their ability to pay attention and blocked opportunities for growth, he said. "Those people are largely taking themselves out of the game. They're they're much less likely to ever amount to anything. They're less likely to develop social skills, less likely to marry."

Attention deficit

Haidt's book "The Anxious Generation" explores how social media and smartphones have transformed younger generations. Its publication in March 2024 sparked fresh concerns and conversations about the mental health crisis affecting young people.

Haidt told BI that he now thinks he understated the scope of the problem.

"It's not just mental health," he said. "The decimation of human attention around the world might even be a bigger cost to humanity than the mental health and mental illness epidemic."

The NYU business professor previously explained on an episode of "The Tim Ferriss Show" that young people's attention scarcity is proving an issue as they enter professional life. They're not developing well in the workplace, and managers are finding it hard to work with them, he said.

Martin Sorrell echoed Haidt's comments about Gen Z's attention span on a Davos panel chaired by BI's Spriha Srivastava titled "Mass Events, Massive Gains?"

The founder of WPP, one of the world's largest advertising agencies, said events must evolve to appeal to Gen Z consumers who won't tune in for an entire football game or golf tournament.

Sorrell said that "getting them to watch things is totally different because they watch highlights," adding that "they're multitasking even when they're watching highlights."

At Davos, business leaders were focused on how to adapt to the changing culture Gen Z is bringing to offices.

Haidt's biggest piece of advice for employers and managers is to explain the concept of anti-fragility to their Gen Z employees.

Anti-fragility is the idea that "we grow from adversity and effort," Haidt told BI. That means giving employees direct feedback and challenges so they can learn, develop, and address their shortcomings.

Talk and listen

Haidt added that Gen Z is not in denial and are aware of the problem.

"Talk to your new employees and listen to their concerns, and then make it clear that you want them to succeed and you're going to help them succeed," he said.

Ravin Jesuthasan, a prominent future-of-work researcher and author of "The Skills-Powered Organization," told BI that while Gen Z's attention span has shrunk, individuals are not less creative.

"Maybe the traditional things we relied on for creativity are not there, but I think that this next generation have different ways of engendering their creativity," he said, pointing to GenAI as an example.

Their alternative mindset and worldview can also have benefits for intergenerational teams in the workplace, Jesusthasan said.

Whether or not companies are ready to adapt, GenZ's influence on the world of work is only growing.

Gen Z will make up 30% of the workforce by 2030, EY's global chair and CEO Janet Truncale told a Davos panel titled "Gen Z changes the map."

At EY, the pace of generational transformation is even greater, with Gen Z accounting for about 70% of the workforce by 2030, she said.

To adapt to the changing workforce, it's crucial to recognize that Gen Z is "holistically different" in how it learns and communicates.

Truncale said that doesn't mean Zeds are less effective. "I see the same level of work output and ideas and innovation that are coming from that generation as mine. We've got to meet our employees where they are."

She said that means meeting their needs with flexibility, intergenerational collaboration, and an ongoing dialogue about what workers require.

EY recently launched a new employee value proposition with a strong focus on wellness, and the firm has also started running training sessions through social media and podcasts.

"You're going to start to see more and more CEOs talking about strategy and the vision of their companies through videos while they're running or exercising," Truncale said.

There are traditional conventions and company values that are important to pass down to younger employees, she added. "But there's just as much that we can be taking from the younger generations. We shouldn't be living a life of comparison."

• FOBO was the new buzzword floating around Davos this year.
• The term represents employees' fears of being made obsolete by AI advances.
• Reverse mentoring and targeted upskilling can help employees stay relevant, business leaders told BI.

Rapid AI advances present an alluring opportunity for businesses to boost productivity and efficiency.

But while CEOs battle their FOMO and race to adopt the new technology, their employees are experiencing a different side of the AI revolution — FOBO, the fear of becoming obsolete.

It refers to workers' fears that the speed of artificial-intelligence development is outpacing the reskilling of employees, leaving them redundant in the workplace.

Recent Gallup polling indicates FOBO is on the rise. In a survey of US workers, 22% of respondents said they were worried their jobs would become obsolete because of technology, up from 15% in 2021.

FOBO is a buzzword that kept popping up last week around this year's World Economic Forum in Davos, Switzerland.

In a panel titled "Closing the Jobs Gap," Singapore's president, Tharman Shanmugaratnam, said a global jobs crisis was looming and called for governments and employers to continually invest in workers to increase the chances that AI complements their skills instead of rendering them obsolete.

Business leaders should be just as interested in doubling down on upskilling initiatives as they are in purchasing the latest AI tools, Ravin Jesuthasan, a renowned future-of-work expert and author of "The Skills-Powered Organization," told Business Insider.

There's a return-on-investment incentive to ensure their workers don't get left behind, he said.

"Just giving people access to ChatGPT won't get you a return," Jesuthasan said. Adoption rates tend to be low when workers are just handed a tool, he said.

First, companies should make all training mandatory and set aside time for learning during the workday to encourage engagement, Jesuthasan said. But they should also be strategic in how they train the workforce, he added.

Where you really get the ROI, Jesuthasan said, is by identifying exactly what work is going to be substituted by AI. Employers can then take workers who have been freed up, assess what new skills they need, and retrain and deploy them with those skills to drive growth, he said.

Rafee Tarafdar, the chief technology officer of Infosys, an Indian tech giant, also said that his company was seeing great success with its in-house learning platform.

Infosys has updated the system with generative-AI courses and created an incentive program that rewards employees when they complete modules. Employees are spending an average of 30 minutes a day learning on the platform, Tarafdar said.

The platform's on-the-go nature was a big draw, he said: "If an employee wants to learn anytime, anywhere, on any device, they should have access to it."

Like Jesuthasan, Tarafdar said differentiating employees based on how they'd use AI was key to upskilling them effectively.

"We recognize that some of them will be consumers of AI, which means they will use the AI tools in order to become more productive and efficient, and some of them will be creators of AI," he said. "And then somewhere in between, we'll have builders, those whose skills will change."

He added that as companies developed courses in such a focused way, each employee would learn how to drive value for their specific job.

Reverse mentoring

FOBO could be a particular problem among more senior workers, Jesuthasan said. They might delegate tasks to a secretary or team rather than AI, he said, and may not have received any significant technical training for 20 years.

An approach Jesuthasan said would likely be effective in bridging the age gap is "reverse mentoring," where more mature workers partner up with younger folks who may be more adept with modern technology.

But it's not just digital skills, Jesuthasan said. Younger generations also have transversal skills and a different worldview that will become more useful in the AI future, he said.

"They're more adept because they've grown up in a much more volatile world," Jesuthasan said. "They've not had the luxury of saying, 'I'll be an engineer for life.'"

Ultimately, though, people have to motivate themselves to avoid becoming redundant, the future-of-work expert said.

"Every one of us has to really force ourselves to be curious," he said. "The company can provide resources. The company can provide the space for reskilling and upskilling, but the individual really has to bring the impetus for change."

• The Chinese equivalent of TikTok is less harmful to young users than TikTok, Jonathan Haidt said.
• The author of "The Anxious Generation" spoke to Business Insider at the World Economic Forum in Davos.
• He compared letting TikTok operate in the US to letting the Soviet Union own US media during the Cold War.

The Chinese equivalent of TikTok is less harmful to young people than TikTok, a leading social-media expert said.

"TikTok is severely damaging children in the Western world, whereas the version in China is very different and is much more pro-social and is not damaging their generation," said Jonathan Haidt, a professor at NYU Stern School of Business and the author of "The Anxious Generation."

He made the comments in an interview with Business Insider at the World Economic Forum in Davos on Tuesday.

TikTok does not operate in China, where consumers can use the Douyin app. Douyin is subject to different regulations, including the Chinese Communist Party's censorship rules.

TikTok and Douyin are both owned by ByteDance but operate independently, with TikTok's CEO based in Singapore.

Douyin's users are generally older than TikTok's and it has introduced measures to curb online addiction. Douyin has a "youth mode," which limits users under 14 to just 40 minutes a day and locks them out between 10 p.m. and 6 a.m. daily.

A less restrictive version of youth mode limits the content that users between 14 and 18 can view through the search function.

Douyin has said it pushes "enriching" content related to general knowledge and educational material to users in youth mode, BI previously reported.

The changes were introduced in 2021 when the Chinese government was imposing a series of measures to limit the time children spent online.

In the US, TikTok has said it has "robust safeguards" and removes suspected underage users. "We have voluntarily launched safety features such as default screentime limits, family pairing, and privacy by default for minors under 16," a TikTok spokesperson previously told BI. The app defaults to limiting users who are under 18 to 60 minutes a day.

Attorneys general from 14 US states are suing TikTok for exploiting and harming children's mental health. Documents from the ongoing investigation revealed that officials at TikTok knew the algorithm was highly addictive and could harm children's mental health.

A TikTok spokesperson said: "This lawsuit ignores the number of proactive measures that TikTok has voluntarily implemented to support community safety and well-being. Instead, the complaint cherry-picks misleading quotes and outdated documents and presents them out of context, which distorts our commitment to the safety of our community."

Haidt's book explores the effects of social media and smartphones. He argues that apps like TikTok affect young people's attention spans, which in turn blocks opportunities for growth and creativity.

"We know that TikTok has a damaging impact on the development of young people" and China "is able to influence what happens on TikTok," he said. "So I think TikTok is a major national security threat for the United States and other Western countries."

A US appeals court last year found that the US government had offered no evidence to show China was manipulating content on TikTok in the US, but there was evidence that China has compelled TikTok to manipulate content elsewhere.

TikTok is facing an uncertain future in the US. A divest-or-ban law passed by the Senate in April mandated that TikTok had to stop operating in the US on January 19 unless it was sold by ByteDance. The Senate voted 79 to 18 in favor of the bill.

Some lawmakers have called for the intelligence briefings related to the case to be declassified so the government can "better inform the American people about the significant risks the social media platform's Chinese ownership poses to our national security." Other senators have said the "ban lacks evidence."

The platform briefly went dark for US users on Saturday but resumed on Sunday after Donald Trump said he would sign an executive order delaying the ban.

After his inauguration on Monday, Trump paused the ban for 75 days. The company said it will work with the president on a "long-term solution that keeps TikTok in the United States."

Haidt compared allowing TikTok to continue operating in the US to allowing the Soviet Union to run The New York Times and other leading media sources during the Cold War.

"The Soviet Union invested a lot of money in trying to change American public opinion and trying to divide us and trying to make us hate each other. From the 1950s through the end of the Soviet Union, they had a culture change program, and of course, China has one," he said.

"It is just inconceivable to me that the Soviet government could have owned The New York Times and The Wall Street Journal and PBS."

• Francesca Lagerberg is CEO of Baker Tilly, one of the world's 10 biggest accounting firms.
• In an interview with BI, Lagerberg explained why her firm has managed to buck the downward trend in the sector.
• Lagerberg doesn't want to turn Baker Tilly into a lesser version of a Big Four firm, she told BI.

The Big Four professional services firms lead the accounting and advisory market globally. They have a combined 1.5 million employees, generate billions in annual revenue, and their easily recognizable names draw in scores of eager young graduates annually.

But for all their status, the Big Four have seen a marked drop in growth rate over recent years, and their consultants have been leaving.

Bucking that downward trend in the market is Baker Tilly, a midsize network of around 140 member firms.

Its offering of tax, advisory, and legal services generated global revenue of over $5 billion for the year ending December 2023, an 11% increase from the previous year and a record high for the firm. It's now one of the top 10 accounting firms in the world.

For Baker Tilly, though, the goal isn't growing to the point where the Big Four becomes the Big Five, its CEO Francesca Lagerberg told Business Insider.

"Am I ambitious? Yeah, very," she told BI. "But am I ambitious to be a lesser version of something else?"

"The Big Four Super Tank is an amazing organization, very successful and really good at what they do. We just operate in an environment where midsize firms excite us."

Lagerberg said Baker Tilly's success is due to its great proposition, strong member firms within the network, and the moves those firms have made into bigger markets.

"It's a very good time for us. We've been able to offer what the market needed. We've been in markets where growth has continued and the kind of work that we specialize in seems to have a bit more of an ongoing level."

"In the mid-tier, where we are strongest, firms are looking for that kind of input and advice. So we've been able to offer the services they want, and there hasn't been that drop-off."

Smaller-scale growth has also meant the firm didn't follow the overstaffing fallout that has afflicted bigger names.

On paper, all accounting firms like Baker Tilly appear to offer the same services, but Lagerberg, who's spent her career in professional services, says it's the culture that helps differentiate the firm. It's not just about the services you provide, but offering them in a way that clients would like to have them delivered, she said.

"It is fundamentally about the values and behaviors that we have. We have a very strong people-first approach, and we genuinely mean it," she said.

There are no strict work hours at Baker Tilly that other firms are renowned for. Instead, the company offers its employees unlimited holidays and flexible working. It's an organization whose staff actually get on with each other and that attracts like-minded clients, Lagerberg said.

Being people that others like to do business with is a "much-misunderstood part of how the world goes around," she added.

The private equity wave

The mid-tier sector of professional services firms hasn't avoided the slowdown hitting the Big Four.

Together with economic pressures and high interest rates, the strain is helping drive a new wave of private capital investment in mid-tier accounting firms.

Firms have typically paid out profits to equity partners, who also get a vote on how the firms are run. External cash injections are divesting the control historically promised to partners and shaking up the culture at firms.

In the US and UK, firms like Grant Thornton, Cooper Parry, and EisnerAmper have gone down the private equity route. In 2024, Baker Tilly US did the same, selling a majority stake to private investment groups Hellman & Friedman and Valeas. It was the second-largest deal to be done in the sector.

PE has lots of advantages, but it isn't a golden bullet, Lagerberg told BI. One benefit is that it's providing an influx of capital that's necessary for firms as they evolve with technology and data.

"We used to be a really cap-light business. Now, we're a cap-heavy environment, so it's not surprising that PE is seeing growth," the Baker Tilly CEO said.

It's also bringing about a huge change in the culture that not all partners are happy about.

"A lot of partners they've operated in an environment that's been very similar all their careers, and suddenly in comes an external stakeholder," Lagerberg said. But they also bring a new rigor to firms.

"PE houses are very good at running organizations in an efficient way. I think you'll see an even stronger emphasis on the financials and looking for a return."

The reality for any business is that you can't be future-proof, Lagerberg said. In this era of instability, this is part of the reason companies keep turning to Baker Tilly.

"You will not make all the right decisions because no one quite knows where something is going to go. But you can be future fit. How can you get yourself to a position where you're going to ride out most of it? Some things are going to be amazing opportunities. Are you ready to take them?"

Do you work at a consulting or accounting firm? Contact this reporter in confidence at [email protected] to talk about your experience and the industry.

• Europe's economy has a competitiveness and innovation problem.
• The new Trump administration and Chinese pressure will only squeeze the economic bloc harder.
• These five things could help Europe drive innovation, according to EY's Europe boss, Julie Teigland.

Most EY employees spend their days analyzing individual businesses or conducting audits for clients. But at the upper ends of the EY machine, its leaders are part of the global conversation — consultants to governments and industry groups.

Julie Teigland, the firm's managing partner for Europe, the Middle East, India, and Africa, told Business Insider that in Europe, the big business challenge is a lack of competitiveness and innovation.

This picture only looks set to become more complex as Europe is squeezed between the new Trump administration's expected tariff policy and Chinese retaliation.

In 2025, US GDP growth is expected to be significantly higher than that of Europe. The IMF forecasts 1% growth in the euro area in 2025, compared to 2.7% in the US.

"You don't want the US going twice as fast as Europe. That creates a downward spiral," Teigland told BI.

Teigland said she is trying to drive conversation around what Europe can do to change this.

"We have a million examples of go-getters, but if we don't give them the ecosystem they need, they won't be successful," Teigland told Business Insider.

She believes there are five things Europe can do in the short term to drive innovation and be more competitive.

1. Clearer implementation of regulation

"Over last years the number of regulations and the length of the regulations has more than doubled," Teigland said.

Every member country's market is different, but any time new legislation comes in, it can be implemented in 27 different ways, she said. To stop duplication and inefficiencies, the EU needs to create more alignment on implementation before signing laws, she said.

2. Create a capital markets union

A capital markets union (CMU) would create a single market for capital in the European Union, breaking down barriers that block cross-border investments and allowing nations to share risk.

"We need Europeans to invest in European companies," Teigland told BI. Creating a CMU would "unlock billions" to create more of an innovation ecosystem. She wants to see the EU unbundle fees and allow pension funds to invest in equities with its biggest markets, like Germany.

"Why would you not make that transparent and lower the cost? Why do European mutual funds have to be significantly more expensive than American ones."

3. Support European champions by changing the laws on anti-competition

"We haven't been able to create any European champions in any industry, especially not in tech. Why? Because we don't allow them to combine across borders," said Teigland.

Teigland said the way to foster "champions" — companies that help Europe compete with other economic powers — is to find more balance between regulation that drives protectionism and ones that drive innovation.

The laws on anti-competition need to be changed, particularly for larger companies in late-stage financing, she said.

"Think of all the things that have been knocked out, all the deals that have been brought to the table that Europe has said no way, we're protecting the individual consumers in the individual countries."

4. Stick together against Trump and China

"Both the Chinese and America's strategy has been to pick the Europeans off one by one," Teigland said. But they have to work together to prevent this, she added.

"I think they just have to say, Donald, you're dealing with all of us. We're not going to take a deal for Germany and a deal for Spain."

The EU can use Big Tech litigation as a bargaining chip and offer to scale back its review of companies like Meta, Apple, and Google. They can also use the promise of more defense spending and purchasing US energy.

5. Create a clear investment strategy — especially for defense and industrial spending

Lastly, Teigland thinks Europe needs a clearer investment strategy — "aligning on what we want at the beginning, instead of at the end."

She highlighted the defense and industrial spending plans, noting that even though Trump is expected to increase pressure on the defense industry, there had not been a mapping for industrial policy.

Citing a recent conversation with a NATO General, Teigland highlighted issues with communications technology in tanks. The person shooting the mortars has "to open the lid, use their Apple phone to dial, to call the guy to give him the coordinates because nothing links with each other across Europe," she said.

Teigland told BI that the EU needs a map of who is producing what and how it combines so that it can determine where to invest.

Europe's outlook

It's going to take money to create the ecosystem for success, and combining forces is no small thing for the bureaucracy-heavy EU bloc. But Teigland said she's positive about the direction of change.

Industry groups are aligned about the need to boost competitiveness and trim down regulatory burdens, and senior EU politicians Teigland speaks to are "really listening," she said.

Recent moves by Ursula Von der Leyen, the president of the European Commission, are one of the biggest signs things that Europe is getting serious about boosting economic growth.

After winning a new mandate in 2024 to lead the European Commission for another five years, Von der Leyen has said she wants to launch a "simplification revolution" and cut regulatory "red tape" by 25% in the first half of 2025.

Teigland said the aligned structure of Von der Leyen's team also signals a changing wind. "In one way, she's concentrated her power, but it's also huge that each minister has an overlapping area."

It's a microcosm of how Teigland thinks the entire bloc should be acting: "She recognizes the interconnectedness of the topics and the need to consolidate and do a few things well together. That gives me hope."

• The US law market is largely off-bounds to Big Four firms due to ethical rules on legal independence.
• KPMG is close to changing that by securing a unique license in Arizona to practice law.
• Traditional law firms shouldn't feel threatened by the move, a legal expert told Business Insider.

KPMG is one step closer to becoming the first Big Four firm to set up a legal division in the US.

On Tuesday, an Arizona judicial committee unanimously recommended that the state Supreme Court approve KPMG US's application for a unique state license that would allow it to practice law.

If approved, the firm will establish KPMG Law US as an alternative business structure (ABS). The Arizona Supreme Court told BI it would weigh the decision on January 28.

Arizona began its ABS program in 2021, scrapping a rule that prevents non-legal ownership of law firms.

The rule was set by the American Bar Association and only allows licensed lawyers to own or invest in law firms in an effort to prevent conflicting interests.

It has held back the Big Four professional services firms — KPMG, Deloitte, EY, and PwC — from establishing legal divisions in the US as they have done in other key markets.

Practicing law in the US "is something that no Big Four network firm can currently do," Christian Athanasoulas, a partner in KPMG's Tax Division and US head of Tax services, told BI.

The firm does provide business advice to legal clients in the US, he explained, but does "not interpret and apply legal standards to legal questions."

Athanasoulas said advances in technology and the growing demand for alternative legal services made it the right time to establish KPMG Law US, and they were "excited by the opportunity" that Arizona's regulatory reform presented.

"Pending approval, this innovation would differentiate KPMG Law US both in the legal and the consulting markets," he said.

The firm aims to focus primarily on large-scale, process-driven work, such as volume contracting, remediation exercises, and M&A-driven harmonization of contracts.

KPMG will position itself as complementing the services of traditional law firms rather than competing with them. It won't work on complex commercial transactions, trademark disputes, and other areas that are "core capabilities of traditional law firms," Athanasoulas told BI.

What they do have over competitors is the ability to harness KPMG's holistic, global suite of services.

"We see opportunities in the market to provide these required tasks, at scale, with better controls and more standardized outcomes than some existing market participants currently provide," Athanasoulas said.

Their work would not be limited to Arizona but could extend nationally, depending on individual state rules.

KPMG is already a major player in the global legal landscape, providing legal services in more than 80 jurisdictions. In the last financial year, the tax & legal division was KPMG's fastest-growing function, expanding by almost 10%.

The Big Four and the US legal landscape

The pending approval of KPMG Law US's ABS status raises questions about whether the other leading firms will follow suit and whether that will change the nature of the US legal market.

The Arizona Supreme Court said it introduced the ABS program to "transform the public's access to legal services," according to a 2020 press release.

"If the rules stand in the way of making those services available, the rules should change," the Court said.

Over 100 firms have since been approved to practice law under the program. Advocates for the Arizona ABS program say it deepens competition, lowers prices, and facilitates easier access to justice.

Utah is running a similar pilot program, and there are exceptions in Washington, D.C., that allow non-lawyers to hold minority stakes in a law firm. But other states have not yet followed suit.

"The most frequently stated concerns are that non-lawyer ownership or investment will create conflicts or low-quality work because of profit motivations," Brad Blickstein, CEO of Blickstein Group, a legal industry consultancy, told BI.

KPMG said any new firm would be governed by the same high ethical standards that apply to other law firms, and there would be no crossover between legal services clients and audit clients.

Legal experts have been predicting that the Big Four will move into the US law market for several years, Blickstein said. While they may take some work over time, traditional law firms shouldn't feel threatened, he added.

"KPMG is somewhat limited in what it can do as an Arizona law firm, and even in markets like the UK where they have free rein, the Big Four has not put too many law firms out of business.

"I continue to believe that the Big Four will eventually have a meaningful - but not existential - impact on US law firms and legal departments," Blickstein said. "This is a step in that direction, but only a step."

• Staff at WPP are pushing back against the company's new 4-day RTO mandate.
• A public petition calling for the firm to revoke its policy has gained thousands of signatures.
• Shares in the company have fallen by 8% since the policy was announced.

A public petition criticizing advertising giant WPP over its recently announced four-day per-week return-to-office mandate has garnered thousands of signatures.

In an internal memo sent last week, WPP's CEO Mark Read told the company's workforce of more than 100,000 employees that they would be expected to spend an average of four days a week in the office from April.

"I believe that we do our best work when we are together in person," Read wrote in the memo. Since the policy was announced, WPP shares have fallen by 8%.

In response, a group calling itself "Concerned WPP Employees" has created a petition on Change.org calling for the company to revoke the policy.

"WPP's decision seems to be a step backwards in supporting employee wellbeing and work-life balance, citing anecdotal data that either does not exist or has been misrepresented," the petition states.

It argues that "rigid work regimes" like the WPP mandate can have "extensive" mental and social impacts on employees.

The petition calls on Read and WPP leadership to "reconsider this mandate and adopt a policy that respects and prioritises the well-being and preferences of its employees."

The petition's creators told BI that their goal was to "clearly demonstrate how deeply unpopular this mandate from our CEO, Mark Read, is across the global WPP network."

Avenues to take action internally were limited and associated with substantial risk, they said.

"Whilst no official response has so far been provided, we are aware that the sheer volume of signatories so far received has created substantial internal debate across our C-suite leadership population," the petition creators said.

The petition had received over 7,500 signatures in the four days since it was created.

It is not clear how many signatories are WPP employees, as Change.org is a public forum that allows signatures from people outside the organization.

"We can (and will) validate signatories if necessary should our leadership team take the unfortunate decision to challenge the reliability of thousands of employee voices," the petition's creators told BI.

One WPP employee, speaking with BI on condition of anonymity because they were not authorized to speak publicly on company policy, said that there had been "palpable dismay" inside the company at the way the policy has been handled.

'We're in the communications business but this could have been done so much better, a lot of people here think," the employee said. "You pick your moments to do something like this. And with a shaky economy and nervous clients, now is not the time to alienate staff."

When asked about the petition, a WPP spokesperson said the company knew the four-day mandate would not be popular with everyone, but said that WPP believed it was "the right policy for the long-term interests of the company as a whole."

"We will take the time to implement it in a collaborative and pragmatic way with our teams," the spokesperson said.

The company previously told BI that it was not implementing the policy until April to give it time to address office capacity and other concerns.

RTO policies haven't gone without challenges. As major companies have turned away from flexible working, many have been criticized by some staff.

After Deutsche Bank mandated staff come in for three days a week, the company faced a wave of backlash from staff who complained about the lack of office space and bottlenecks.

At the German software giant SAP, thousands of staff signed an internal letter saying that they felt "betrayed" by the company's "radical" RTO policy. There have been no reports that the letter altered the company's policy.

Legal routes against RTO mandates are fairly limited. Unless there's a protected reason under established law, such as a medical circumstance, employees have no recourse to take legal action against RTO mandates, Ron Zambrano, the employment litigation chair at the California law firm West Coast Trial Lawyers, previously told BI.

Workers often have little choice but to accept the RTO push or look for a different company, prompting some employment experts to warn that the wave of return-to-office directives could fuel attrition.

Losing talent is a risk some companies are willing to take to get workers back to the office, Ravin Jesuthasan, a future of work expert and author of "The Skills-Powered Organization," previously told BI.

These companies have calculated that they have the legroom to implement stricter policies and perhaps lose some core talent but essentially be fine, Jesuthasan said.

"Some organizations might say, you know what? We've got a really deep pipeline of talent. There's lots of people who want to come work here, and so this is our culture and this is how we're going to sustain our culture," he said.

• Andersen Consulting was once one of the top names in professional services.
• The firm rebranded to Accenture in 2000, and its parent company went bust following the Enron scandal.
• Now Andersen Consulting is making a comeback, The Financial Times reported.

One of the leading consulting brands of the 1990s, whose parent company was brought down in the Enron scandal, is making a comeback.

Andersen Consulting, which was one of the "Big Eight" consulting firms, will relaunch next month, unnamed sources told The Financial Times.

The firm's comeback has been orchestrated by Andersen, a tax business founded in 2002 by former employees from Arthur Andersen, the once-prestigious accounting firm and the parent company of Andersen Consulting. It acquired rights to the Arthur Andersen name in 2014 and renamed itself Andersen in 2019.

Andersen has mostly focused on tax and legal work but has been steadily building a consulting division under the guidance of George Shaheen, a former CEO of Andersen Consulting in its heyday. Shaheen joined the group as a special advisor in 2022, according to his LinkedIn profile.

In the past six months, the company has added 20 member firms focused on consulting from the US and other countries, several of which have connections to the old Andersen Consulting and Arthur Andersen, the FT reported.

"Six months ago, we began building Andersen Consulting, and already we have 108 offices in 66 countries with nearly 3000 employees," Mark Vorsatz, Andersen's CEO, said in a statement sent to Business Insider.

"We're seeing incredibly fast growth. Our goal in three years is to reach a billion dollars in revenue, which I think is very realistic."

"Our global firm has a massive competitive advantage and this scale creates a unique consulting experience that is unrivaled in the crowded consulting space," he added.

The resurrection of Andersen Consulting marks a major comeback for what was once a leading name in professional services.

"Andersen Consulting was the Coca-Cola of professional services," Vorsatz told the FT. "If you are over 40 in business, you know Andersen Consulting."

The original Andersen Consulting split from its parent company, Arthur Andersen, in 2000 and rebranded as Accenture.

One year later, the Andersen name was tarnished when Arthur Andersen became embroiled in the Enron scandal. Executives at Enron, one of the largest energy providers in the US, were found to have hidden billions of dollars in debt by manipulating financial models and lying to investors.

Enron filed for bankruptcy, and thousands of employees lost their jobs and retirement savings.

Arthur Andersen, Enron's auditor, was found guilty of obstruction of justice for shredding its client's auditing documents as the government started its investigation.

The fallout led to Arthur Andersen's collapse in 2002, reducing the "Big Five" global accounting firms to four. It is one of the most dramatic corporate collapses in US history — one year earlier, the firm had reported roughly $9 billion in global revenue.

The rebooted version of Andersen Consulting would not try to compete with Accenture as an outsourcing services provider, Vorsatz told the FT.

• The Panama Canal Authority chief said giving preferential treatment to one country's ships would lead to "chaos."
• Ricaurte Vásquez Morales told The Wall Street Journal: "Rules are rules — and there are no exceptions."
• Trump has accused the canal authority of charging "exorbitant" fees to US ships.

Giving US ships preferential rates to navigate the Panama Canal would "lead to chaos," the head of the canal authority said.

"Rules are rules — and there are no exceptions," Ricaurte Vásquez Morales told The Wall Street Journal on Wednesday.

"We cannot discriminate for the Chinese, or the Americans, or anyone else. This will violate the neutrality treaty, international law and it will lead to chaos."

In a news conference at Mar-a-Lago on Tuesday, President-elect Donald Trump demanded that US vessels be given preferential treatment.

He also accused the authority of overcharging US ships and of separately seeking funding from the US to repair the waterway. Vásquez Morales denied both those claims, telling the Journal that the authority funds maintenance from the fees it charges and that Panama hadn't requested funding from the US for improvements.

Ships are charged between $300,000 and $1 million depending on their size and type to pass through the canal.

Those charges "apply to all ships from around the world and there are no exceptions," Vásquez Morales told the Journal.

Trump has repeatedly floated the idea of retaking control of the canal, calling the fees "exorbitant" and a "rip-off."

"The fees being charged by Panama are ridiculous, especially knowing the extraordinary generosity that has been bestowed to Panama by the US," he said on Truth Social in December.

At Tuesday's news conference, Trump also downplayed Panama's control of the canal and refused to rule out using military force to retake control of the trade route, expanding on a threat he made last month.

"China's basically taken it over. China's at both ends of the Panama Canal. China's running the Panama Canal," the president-elect said.

Vásquez Morales told the Journal: "China has no involvement whatsoever in our operations."

In response to Trump's comments, Panamanian Foreign Minister Javier Martínez-Acha said on Tuesday that only Panamanians operated the canal, adding: "Our canal's sovereignty is not negotiable and is part of our history of struggle and an irreversible conquest."

Trump has also refused to rule out using military force to take control of Greenland, which he said the US needed for "national security purposes."

The 51-mile Panama Canal was officially opened in 1914, creating a new trade route between the Atlantic and Pacific oceans.

The US transferred control to the state-owned Panama Canal Authority in 1999 in accordance with the Torrijos-Carter Treaties, initiated in 1977 by the Carter administration.

Under the treaty, the US has the right to defend the canal from any change to its neutrality.

• The advertising giant WPP is telling workers to come to the office four days a week from April.
• Business Insider obtained the internal memo sent to the company's 114,000 employees.
• "I believe that we do our best work when we are together in person," CEO Mark Read said in the memo.

The advertising giant WPP has told its workforce of more than 100,000 employees to return to the office at least four days a week.

"From the beginning of April this year, the expectation across WPP will be that most of us spend an average of four days a week in the office," WPP CEO Mark Read wrote in a memo sent to staff on Tuesday and seen by Business Insider.

The Financial Times first reported the move.

The policy is set to go into effect in April to give staff time to make adjustments and to "address capacity requirements" in offices, he wrote.

The CEO said in-office attendance was associated with "stronger employee engagement, improved client survey scores and better financial performance."

"I believe that we do our best work when we are together in person," he wrote. "It's easier to learn from each other, it's a better way to mentor colleagues starting out in the industry, and it helps us win pitches as a truly integrated team."

Under the new policy, WPP will allow staff one flexible working day a week and consider individual circumstances through a formal approval process, a person familiar with the matter told BI.

One WPP employee, speaking with BI on condition of anonymity because they were not authorized to speak publicly on company policy, said they still had questions about the return-to-office plan's practicalities. They said that in some offices, there were already issues with securing enough desk space or meeting rooms, for example.

AT&T this week began implementing a staggered five-day RTO mandate, and workers told BI that limited available desks and elevators at some offices complicated their return.

Amazon encountered office-capacity issues last year, which, as BI previously reported, delayed its full return-to-office plan for some employees.

Another WPP insider said they felt the move would be positive for younger staff and help them network and learn from colleagues, while allowing flexibility for those who required it.

WPP's announcement follows that of its fellow advertising giant Publicis Groupe, which last year told employees to return to the office at least three days a week. The company later fired hundreds of employees for noncompliance with the mandate, Ad Age reported in October.

Bruce Daisley, a workplace-culture consultant and former Twitter vice president, said WPP's return-to-office policy would be an employee-morale gamble because advertising jobs already aren't as lucrative and aspirational as they once were.

"Working in an advertising agency used to be gloriously paid, now those who work in the field squint into spreadsheets all day earning salaries that are often substantially lower than the clients and media owners they deal with," Daisley wrote in his Make Work Better newsletter.

Read the full memo CEO Mark Read sent to WPP employees:

To everyone at WPP

I hope you had a restful holiday season and the chance to recharge over the break.

As I wrote to you in December, 2025 is going to be a year of opportunity for WPP — a year when we can win through a relentless focus on our clients.

With that in mind, I wanted to share our priorities for the next 12 months, as well as a change we are going to make in the way we work.

Clients, creativity and our work

WPP's mission is to deliver creative transformation for the world's leading brands. This means not only producing exceptional work in every discipline of modern marketing, but helping clients transform how they operate for a very different world. This is ever more true of our largest and most important clients, who come to us for the quality of what we do, the breadth of our skills, and our ability to prepare them for the future.

While industry mergers and jostling for status may distract our competitors, focus will be paramount for us in 2025. We have the opportunity to stand out by being more obsessed than ever with serving our clients. In every single decision we make, we should ask ourselves "how will this help us do even better work for our clients?" Those companies who embrace this philosophy will be those who emerge on top.

Technology, data and AI

Demand from clients for creative ideas, effective media plans, brilliant PR campaigns and outstanding design remains constant, but the way in which we deliver our work is changing faster than I have ever seen. That's why technology, data and AI are at the heart of our plans for the future, and why adoption of our AI-driven marketing operating system WPP Open has grown so quickly. Keeping up that momentum is another key objective for 2025.

WPP Open helped us win a number of 2024's biggest reviews and we are going to increase our investment in Open this year to build on the success it has brought us. It will be central to how we bring an integrated, AI-enabled offer to market, with the goal of producing better results for clients and winning more than our fair share of pitches in the year ahead.

A culture of winning, together

Finally, we are going to focus on the culture of our company. For all our technological sophistication, we remain a people business. Across everything we do, our success still relies on the fundamentals of human connection, creativity and relationships. Teams of talented individuals, working towards common goals, are what drives growth for our clients and our agencies.

I believe that we do our best work when we are together in person. It's easier to learn from each other, it's a better way to mentor colleagues starting out in the industry, and it helps us win pitches as a truly integrated team. The data from across WPP agencies shows that higher levels of office attendance are associated with stronger employee engagement, improved client survey scores and better financial performance. More of our clients are moving in this direction and expecting it of the teams who work with them.

For all these reasons, spending more time together is important to all of us, and we are making a change to help that happen. From the beginning of April this year, the expectation across WPP will be that most of us spend an average of four days a week in the office.

This doesn't mean we're going back to old ways of doing things. During the pandemic we all learned the value of greater flexibility in our working lives and of being trusted to balance work and personal commitments. We need to keep that spirit of flexibility and trust, and will approach this transition with pragmatism and an understanding of people's different circumstances. There will be a clear process to request additional flexibility — including for those with caring responsibilities, health issues and other considerations. Some roles that have always been fully or largely remote will continue as they are.

We know that for some colleagues this new policy will require adjustments to their routines and arrangements, which is why it will not come into effect until April — giving people time to make any changes they need to. There is also work to do between now and April to ensure we make the best use of our workspaces. Our WPP campuses offer superb working environments in beautifully designed buildings with leading environmental credentials. But it will take detailed planning in the coming months to address capacity requirements and other related areas, and I'd like to thank the teams who are already hard at work figuring that out.

Your leaders are working closely with the WPP People and Real Estate teams, and will follow up with next steps for your part of the business. It's important that we take a consistent approach across our agencies, who will communicate the requirements to you in detail. In the meantime, visit insideWPP for FAQs, details of the policy, and an AI-powered chat agent to help answer your questions.

A collaborative, winning culture is what makes WPP and our agencies a great place to work, and it's the key to our future growth and success. I firmly believe this change we are making will protect and enhance that culture, for the benefit of everyone.

As always, if you want to get in touch, email me.

Mark

• The Society for Human Resource Management, known as SHRM, is the world's largest HR association.
• These are the themes that SHRM anticipates will most impact businesses and HR professionals in 2025.
• Job retention, the skills gap, and how to manage polarizing workplaces are top of the agenda.

2025 holds plenty of challenges for employers and HR professionals. Labor shortages are making hiring a nightmare; they're anticipating new regulations and tariffs under the Trump administration, and they have to skill up workforces for AI if they don't want to get left behind.

The Society for Human Resource Management is there to help them.

SHRM is a member-driven organization that researches the biggest issues and innovations impacting today's workplaces and helps give business leaders and HR professionals the tools they need to build a "more civil and productive workplace."

The US-based group has nearly 340,000 members in 180 countries.

SHRM released an outlook of the areas it will be focusing on to best help HR professionals in 2025. These are some of the themes they say will shape the future of work next year.

The ongoing labor shortage

The job market is strong, but the reality for job seekers and employers alike is more complex.

On the employer side, job openings are outpacing active job seekers. That has left businesses struggling to fill openings. Many employers are also "labor hoarding" in an attempt to manage quit rates and prevent labor shortages many experienced after the pandemic.

1.7 million Americans are missing from the workforce compared to February 2020, according to the US Chamber of Commerce.

Supporting businesses as they navigate talent acquisition and retention is a key focus for 2025, SHRM said in its yearly overview.

One of the organization's suggestions for employers was to look at untapped talent pools, such as veterans, workers with disabilities, military spouses, and caregivers. Addressing barriers like outdated policies and insufficient flexibility could help maximize workplace recruitment and retention, SHRM said.

Political changes

The new administration could bring about new regulatory shifts, creating a wave of uncertainty for employers.

SHRM anticipates that businesses will need assistance adapting to new rules and policies and understanding their workforce impact.

2025 could also see a rise in polarized workplaces in connection to "conservative trends in federal courts and agencies," SHRM said in its outlook. Changes could impact workplace diversity initiatives, and the ripple effects of proposed tariffs could hit talent management and compensation strategies.

The organization also highlighted that its civility research unit found nearly 223 million "acts of incivility" per day following the 2024 election.

Common examples of incivility in the workplace include "intentionally interrupting or speaking over others, people being rude or inconsiderate, and gossiping or spreading rumors," according to SHRM.

The group said it would be focusing on equipping chief human resources officers (CHROs) with the tools and knowledge they need to foster resilient and inclusive workplaces.

The skills gap

AI holds huge potential for organizations, but to truly capitalize on the technology, investments must also extend to the workforce.

Currently, workers lack key skills like digital literacy and technical competence to collaborate with AI, creating a need for targeted upskilling and reskilling programs, SHRM said.

The impact of AI on the workforce will be more dramatic than previous technology shifts, SHRM President Johnny C. Taylor Jr. told Business Insider in August.

"We are not being as transparent as we should be with human beings workers about how significantly AI is going to change how we work and what work we do," said Taylor.

SHRM's outlook said that one in eight jobs has already been displaced by AI, and it added that addressing worker concerns about job security will also be a focus this year.

• Nearly 160 accounting execs and partners were asked about why firms were making more auditing errors.
• The auditors were split on whether a better work-life balance could reduce the number of errors.
• But they have to consider whether remote work could help attract Gen Zers amid an accountant shortage.

US accounting firms are split on how to deal with the shift to remote work, a report published by the Public Company Accounting Oversight Board, a government-backed audit-oversight board, has found.

The report, published last month, was part of the PCAOB's investigation into why auditing errors had surged following the pandemic and whether internal culture contributed. Though deficiency rates slowed in 2023, they've consistently risen since 2020. Accounting errors can lead to embarrassing and costly legal challenges and damage business integrity.

The report was based on inspections of quality-control systems and anonymous interviews with 156 executives and partners at six major firms: Deloitte, EY, KPMG, PwC, BDO, and Grant Thornton.

Sixty-four percent of respondents said that improving work-life balance for firm personnel improved audit quality.

However, roughly one-third of senior executives and partners from the six major firms surveyed said that contemporary remote- and hybrid-work culture had negatively affected auditing firms' quality control.

They said a loss of in-person interactions was making assimilation into the firm's culture more difficult, with newer recruits less attuned to the cultural importance of audit control.

Development opportunities were another concern, with some respondents saying firms were losing the "apprenticeship culture" they've traditionally favored.

"The delayed development of firm personnel affected productivity and made it difficult for some to meet deadlines and expectations," some respondents said.

At one of the audit firms, managers and partners were stepping down a level to do audit work traditionally performed by more junior personnel. This led to reduced scrutiny of the audit work, respondents said.

The Gen Z problem

Tied up with the questions about work-life balance and audit quality is another big issue facing accounting firms: how to attract Gen Z talent.

Respondents from all six firms said that "resource challenges" in terms of hiring were a factor in the increasing audit deficiencies or an overall concern for their companies.

In recent years, auditing firms have struggled to attract younger workers, who expect a better work-life balance.

"The younger generation have differing views on careers than their older counterparts, with many viewing their work more as a job, rather than a career, and are therefore more likely to leave the profession if presented with more attractive opportunities," the PCAOB said.

The American Institute of Certified Public Accountants says about 65,000 students in the US completed bachelor's or master's degrees in accounting in the 2021-22 school year, 18% fewer than a decade earlier. Of those who study accounting, only a portion become certified public accountants. About 30,000 people took the CPA exam in 2022, compared with nearly 50,000 people in 2010.

The fear of personnel leaving was one reason that return-to-office policies weren't being pushed at firms, some respondents said.