As noted in the March post, the CA, CGA and CMA professional associations have proposed to merge their associations to one designation, the “CPA” (Chartered Professional Accountant). The merger is complicated, since not only do negotiations need to happen in each province and territory, some provincial associations are not participating in the merger talks. In Manitoba and New Brunswick, the CGAs are not participating, and in Alberta, the CAs pulled out of discussions in early 2012.
The Manitoba situation took on a new dimension in the wake of an Institute of Chartered Accountants of Manitoba (ICAM) member advisory vote which saw 60% of members in favour of merging, and 40% against. While that is a clear majority, as usual, the numbers hide some important facts.
First, the main reason that 40% of CAs gave for opposing the merger is that they feel that it will weaken the “brand”. On one hand, many CAs feel that merging with other designations will dilute the CA’s reputation as the marquis accounting designation in Canada, and on the other, merging and then renaming from CA to CPA does not weaken the CA brand, it makes it disappear altogether.
Second, early on the Manitoba government signaled its intent to cooperate with any changes based on the recommendation of the three accounting bodies in the province. With 40% of the CAs opposing, and CGA Manitoba not participating at all, over 50% of Manitoban accountants do not support the merger.
To its credit, ICAM has been listening, and on May 2nd, convened a focus group to discuss the issue of maintaining “the brand” and how to address those concerns to win over the 40% who voted no. The discussion was respectful, insightful and thorough. A straw poll at the start (and the end) of the 13 focus group members showed 7 in favour, and 6 against. Two hours of discussion later when the vote was retaken, the straw poll results remained unchanged.
The nay-sayers in the group identified two main concerns: the process, and the business case for merging.
In terms of the process, the main issue was that the communication to the members, though clear and generous, was seen as one-sided (ICAM has clearly stated its support for the merger and communicated accordingly). Through the process there was no critical discussion, debate, listing of pros and cons, or analysis of the risks of merging presented, which was one of the reasons cited for the Alberta CA departure from the process. The one-sided nature of the discussion offended many members and flew in the face of a CA’s reputation for fair and balanced consideration of information. Members do not want to feel railroaded.
Secondly, and more significant in the minds of the participants, the business case for merging does not appear to be well supported (CGA Manitoba cites this as one of their reasons for not participating in the merger discussions). ICAM lists four or five reasons for why a merger is important (see their web presentation), of which the nay-sayers said were specious, and to which there are many questions and responses that do not appear to have been addressed. It is ironic that the most insightful questions and articulate discussion of the risks come from CGA Manitoba, who at this point is not participating in the merger discussion. Read the March blog entry of their CEO (and scroll back in that blog for earlier posts).
The theme of the May 2 focus group was how to protect the brand through the merger process. The nay-sayers in the focus group took exception to that approach, since it first made the assumption that the merger was going to happen, and second, they wondered how you protect a brand when the merger would in fact would make that brand disappear – what would be left to protect?
In fairness to ICAM, this is a difficult process with a lot of moving parts. The communication has been frequent, professionally done and information packed. In a damaging turn of events, it appears that ICAM sought advice on how to campaign in favour of the merger, as the consultant’s purported maketing report to ICAM leaked out, further heightening the sense that the fix was in from the start.
The process is likely to be a long one, and could result in damaging the reputation of ICAM with its members and the reputation of accountants with the public. As noted in the March post, the merger will succeed or fail in Ontario. ICAM might have done better to take a more neutral road and let Ontario have its way.
Read the next update to this story here!