“Who We Are”: Mid-Tier Public Accounting Firms’ Identity and Stakeholder Engagement

Abstract

Using interviews with 37 partners, we study how mid-tier public accounting firms define “who they are,” as expressed through their stakeholder relationships and strategic positioning in the field. We find that these firms prioritize cultivating close, lasting relationships with employees and clients. This is reflected in intentional practices of interpersonal mentoring; hands-on talent development; empowering leadership, entrepreneurialism, and autonomy; career flexibility; and tailored client service. Beyond their strong relationship-focused identity, partners describe collectivistic decision-making and coordination toward firm-wide goals. However, the “melting pot” of homegrown professionals and hires from other firms can create organizational identity disorientation, particularly as firms grow. Maintaining “who they are” amid structural changes (e.g., mergers, growth, and private equity investment) is an especially timely concern. We show how mid-tier firms blend relational and collectivistic practices to engage with internal and external stakeholders, and our findings can help these firms identify stakeholder-oriented strengths worth preserving versus adapting. JEL Classifications: L2; M14; M41; M42.