SALDOMASOCHISTENE

Over the past ten years, the Norwegian partners in accountancy giant PwC have distributed a profit of over NOK 4 billion. No wonder they argue.

Text LINE DUGSTAD Photo LINDA NÆSFELDT, LUCA KLEVE-RUUD & DANIEL SANNUM LAUTEN

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- Something happens to people who start earning eight to ten million kronor a year. And it happens most to those who contribute the least. It's so nice, that. Jørgen Kjørsvik (65) has started packing his bags. Christmas decorations are not taken forward, this year the holiday will be celebrated far from home. In half a day, he will move to the United States to help build a smaller oil services company. But first, he has agreed to tell. About the eight years he led the audit house PwC in Norway. About the greatest period of growth in the history of the company. Since he quit, a top executive has been sacked, partners have disappeared out the doors and talents are gone. What is going on?

“A lot boiled down to personal friendship and playing strategically in terms of one's own position,” says Nils Eriksen, former tax lawyer at PwC. “It's really a rather unpatriotic way of doing business,” says Tore Hoem, who until last year headed PwC's law office in Central Norway.The combination of auditing and consulting is a gold mine for PwC. The margins are sky-high, and the partners are taking out millions. The anonymous auditors have become part of the Norwegian payroll saddle.It was different before. Toppled by Enron. “PwC didn't make money in 2000,” says Jørgen Kjørsvik.It was two fundamentally different cultures that met when the international firms Price Waterhou-SE and Coopers & Lybrand merged. Earnings were miserable. At the turn of the millennium, Kjørsvik became PwC's first Norwegian chief executive. The accountant from Molde, who had been with Coopers & Lybrand since the 70s, was going to stack it all on his bones.A year later, PwC and Arthur Andersen took the knife about who was the biggest. In Dagens Næringsliv, both companies presented statistics to document that they were the first choice among the companies on the Oslo Stock Exchange. PwC had the most clients, Arthur Andersen audited the companies with the highest market value.That was going to join the quarrel.

A few weeks later, shredders began churning in US energy company Enron's office space in Houston, Texas. Documents were destroyed, by order of employees of Arthur Andersen. Enron had been Wall Street's favorite, one of America's largest companies and at most valued at $80 mil-liarder dollars. But investors were starting to get uneasy. The accounting at Enron was funny, the transactions strange and the explanations given were difficult to understand. In the fall of 2001, Enron collapsed. With help from advisers at Arthur Andersen, financial reports were manipulated, debts pulled off balance sheets and lousy results hidden. The International House of Auditors was stripped of public auditor approvals in the United States and went into dissolve.Extraservice. Audit houses' dual role as both duty auditor and adviser had long been the industry's sore spot. The Enron scandal gave new nourishment to the discussion about auditor independence. In Norway, auditors were subjected to crushing criticism after fraud revelations in Finance Credit and the bankruptcy of Sponsor Service. The question was whether consulting made the financial bonds of clients so strong that it threatened the auditor's ability to audit the financial statements objectively. Could it be trusted that the auditor did not audit financial statements where the bottom line was the result of the auditing firm's own advice?

In Norway, companies with a turnover of more than NOK 5 million are required by law to have their accounts audited. The auditor is the trustee of the State, the owners and the employees who shall independently and objectively verify that the financial statements are reliable, that laws and regulations have been complied with and that the assets are properly managed. At the same time, the big international auditing firms are betting heavily on consulting services. Few know business and risk as well as an accountant. And if he is already inside, it is possible to provide additional services. Tax planning, business tasks, valuation, risk analysis, reorganization, corporate governance, strategy advice and audit. In 2002, the big four audit houses Deloitte, KPMG, Ernst & Young and PwC earned far more from selling advice to existing audit clients than from advising other clients, a supervisory report by the FSA concluded.

New rules, new opportunities. Following the Enron revelations, Congress passed the Sarbanes-Oxley Act in 2002, described as the world's strictest corporate reporting rules. The regulations prohibited the auditor from selling a variety of consulting services to its own audit clients in the United States. It quickly became the industry standard worldwide.Audit houses had to choose. Where would the bump be inserted, on advice or audit? The solution was to build the consultancy business as a completely separate business area, with heavy investment in companies where the firm did not already audit the financial statements. The big four went into competition with international sizes such as MCK-Insey and Boston Consulting Group. The Enron case destroyed the auditor's reputation, but ironically, the accounting scandal, and its murky wake, opened new doors. Arthur Andersen was dissolved, but the tightening of regulations led to an avalanche of assignments from listed companies. It was going to be a goldmine for the accountancy firms left standing.

'The awareness of risk has been changed forever, 'Mark Goodburn, international senior manager of consultancy at KPMG, told Businessweek. Investigations, legal assistance and anti-money laundering activities were consultancies in great growth. New and stringent reporting principles for listed companies created a craving for consultants who could implement the new system. And surely who was better suited than the rule-riders at the comptroller, who already knew the business inside out?

Risk management, control and organizational development. The words were chiselled out as the core areas for auditors and consultants at PwC. It became a profitable strategy: The consultants told clients what routines they should reinforce, suggested solutions and helped introduce new systems. And once the systems were in place, the consultants procured people who could maintain the same systems and reinforce the organization. The combination audit and consulting was the way to go. The Norwegian PwC offices grew. Within a few years, the firm recruited several hundred new employees. -- It worked. The demand for the expertise we had was great,” says Kjørsvik. “The proof of the pudding is the eating.

Dividend party. PwC and Kjørsvik were in the sights. The Norwegian stock exchange giants Statoil and Telenor, as global corporations, had to comply with the US rules. PwC got the job. Employees were flown in from all over the country. To Oslo on Sunday evening, home again on Wednesday.— If we were to deliver, everyone had to be with us. Bergen, Stavanger, Tromso. This is how we connected the office network and created growth in all regions,” says Kjørsvik. For three years, close to 40 advisers worked exclusively with Statoil. The money flowed in. PwC hijacked new and large audit clients. In 2004, the newly merged major bank DnB Nor chose PwC as external auditor. Norske Skog, Hafslund and Sparebank 1 Group became part of PwC's portfolio. Turnover passed 1.1 billion in 2005. In one year, the profit increased by almost 50 percent, from NOK 210 million to NOK 300 million. The money went straight to the partners at PwC. The firm is organized as a partnership and works like a pyramid: The many at the bottom make money that ends up with a few at the top. Motivation is held up by the dream of future partner status. As a partner you earn millions, as a new employee you get around 500,000 kroner before you rise through the ranks. The PwC pyramid has five steps before the partner title. There is no independent government. As the partners both lead and own the firm, so too are the partners who sit on the company's supreme body. And it is the general meeting - that is, all the partners - that decides which of them will have the role of CEO. The director will therefore, in one moment make decisions as the boss of all, while in the next moment he is subject to the same colleagues on the board. The partnership in Norwegian PwC for a long time consisted of around 40 people. In the firm, these were called international partners. To motivate the juniors, a new partner level was established. About 90 selected, so-called national partners, were promoted. With partner title on its business card, the firm gained a new layer at the top, with the status and position to recruit clients. There was only one catch to the ownership: The new partners did not have voting rights, as the international partners did. The shares they received were b-shares -- similar to the practice of giving children stakes, with no real influence, in a family-owned company.

As PwC's top manager, Kjørsvik's ambitions were long-term: he wanted to invest in his talents and develop the next generation of PwC. He picked talents from business schools and universities, mostly about 70 young economists and accountants he thought it was worth investing in. “I drew up a lot of young people, they quickly got into the system and got potenza, says Kjørsvik.— Perhaps more than those who had been sitting there for years had wanted.

Look to Norway. The sober moldenser Kjørs-vik rarely hit the big drum — housing in inner Oslo east and a tired Opel in the communal garage. — If we were celebrating? The No. I didn't celebrate that much. I didn't see much champagne, I went home early from the Christmas table. It was mostly work and short vacations, says Kjørsvik.80-hour workweeks were not uncommon: “I worked for a partner in Sacramento, California once, his conception of vacation was to work half days without a tie. During the holidays, he came to work at ten o'clock without a tie and went home at two o'clock. It was a holiday for him. When the two weeks had passed, he returned at seven in the morning wearing a tie and stayed there all day. Then the vacation was over. I thought, “I'm never going to be like that.” But that's how I became,” says Kjørsvik.

When international PwC chief Samuel DiPiazza visited Norway, it wasn't just partners who were invited. Kjørsvik invited several of the younger members of the company to his living room at Økern in Oslo to meet the top manager. There they sat, 13 men and women cramped at a table, having a home-cooked dinner with the regent of one of the world's largest companies.Pwc's growth in Norway was formidable. Revenues approached NOK 1.4 billion in 2006 for the consulting, auditing and law business overall. The firm passed competitor Ernst & Young and became the country's largest. When the first high-rise building in Barcode in Bjørvika came on the market, management struck. Around 600 Oslo employees were to move to the port area of Oslo, with panoramic views to the new opera house. Among the lawyers at PwC, operating margins were nearly 40 per cent, the accounts show. Of every million legal advisers brought in to the firm, close to NOK 400,000 ended up with the partners. “Look to Norway,” top manager Samuel DiPiazza said at international partner gatherings. PwC executives from several countries looked to Norway to learn. Partners in New York wondered: How could the Norwegian company, with its 2000 kroner an hour in fees, beat them financially when they themselves charged five times as much? Kjørsvik has the answer: “We did not lose our people. One of the biggest challenges for audit environments is to retain expertise and employees. According to Kjørsvik, breakthroughs among employees were down to five or six pro-late. At the big companies, the share is between 10 and 15 percent today, according to figures DN has collected. “When you have a big drawdown, you have to spend a lot of expensive effort to replace the people you lose. You're supposed to re-educate them, you're crippling the organization. Our people did not disappear, because we found alternative career paths within PwC. They were auditors, worked as advisers, returned to auditing,” says Kjørsvik.— The combination allowed people to develop and stay with us.Not everyone was equally satisfied.

Sacrificed for Orkla. — It was tragic stuff. Lettuce farmer and investor Einar M. Hanasand from Ran-Daberg outside Stavanger thought he was going to get help from PwC. Hanasand had paid NOK 1 million to lawyers at PwC when he needed to find a new lawyer. In 2006, he filed a lawsuit against the firm to get his fees repaid. The conflict started when, in the early 2000s, Hanasand sued Orkla Finans after losses on investe-rings the brokerage had advised on. But the farmer's charges fell into bad ground, according to court papers from Oslo District Court. Industrial giant Orkla was a potentially big customer. At PwC, forces were working for the firm to drop Hanasand as a client, according to the judgment. “They wanted to get rid of me because they had a bigger and more important customer on the other end. That's how simple it was. But I have put this behind me now,” Hanasand says today.The PwC lawyer who had worked for the lettuce farmer did not like the attitudes of his own employer, according to the court documents. He quit the company. Hanasand found new counsel outside PwC and won against Orkla in court. The verdict was appealed, and the parties reached a settlement. Rita Granlund, who heads the area of audit at PwC, says that at present they cannot comment on this litigation.

But PwC was also going to lose a much bigger customer. In spring 2008, it became known that DnB Nor, the country's largest commercial bank, scrapped PwC and responsible partner Geir Julsvoll as external auditor in favour of Ernst & Young. The disappearance of such a prestigious customer was a scratch in the paintwork. Internally, several people expressed their dissatisfaction that Julsvoll had not been able to hold on to the big bank, which was an important reference customer. One of those who sighed was newcomer Knut Grotli, with a background in the financial industry. A few years earlier, he had started as a partner at PwC.

Thanks, but no thanks. Kjørsvik had kept the partnership under wraps for eight years, more than doubled its turnover and created a money-making machine. 2008 was the best profit year in PwC's history. With sky-high operating margins, close to NOK 570 million was distributed among the then 118 partners. Now Kjørsvik was approaching retirement age. The heir had to be crowned. The partners thought the leadership change was in the box when the majority agreed on a candidate and offered Erik Sønsterud the job. He had been a partner for several years and held executive positions at PwC. But Sønsterud declined. And resigned. Back stood colleagues as question marks. Sønsterud was one of the company's most profitable partners. He had helped make the service area of risk management and control a success. He was offered the top job. Now he went to the family-owned automotive group Møllergruppen, to the position of Chief Financial Officer. Among other things, the election resulted in a halving of revenues, from around NOK 6 million in the last year as an audit partner to 2.6 million the following year. Several wondered if there was anything at PwC he wouldn't stand by. According to Sønsterud, it was a life choice. He had worked and traveled a lot, now he wanted to calm something down. “When I first said no, I wanted to stand at the election. Either take the job and invest in PwC, or walk out, says Sønsterud.The Enron scandal had also put a dent in the revi-sors. Sønsterud saw tendencies he feared would lead the industry in the wrong direction. “The whole industry became very keen to cover its own back. It became more important to take care that you did not make mistakes than to make a good audit. Did you wonder if, as head of PwC, it might be difficult to keep the troops together? “Yes, it's a partnership, and I knew there were strong people with strong personalities. The challenge of a partnership is that those you lead are also the owners. You have the owners both above and below you. Yeah, I thought about that. I had sat six years as a partner and knew what a challenge it was. That was not the main reason why I declined, but it was instrumental,” says Sønsterud.

3 in 13. New names came on the table when Sønsterud said no. The partners Håvard S. Abrahamsen and Knut Grotli were selected as candidates. Grotli had pasts from Arthur Andersen and from Carnegie's corporate department. He had even worked in Ekokrim. He headed PwC's Oslo office and the largest auditing group on the house. In December 2008, Grotli was announced as the new CEO. The new top manager was among the younger partners. He spoke warmly of collaboration across the service areas and regions of PwC. As the firm grew, its offices had been divided into regions. Each with its own bottom line. The model was supposed to create local ownership and incentives. How much each partner pulled in became largely dependent on the profitability of the region. The more partners in each region, the more partners to share the profits with. The question was how much of the surplus the regions should keep. And who was going to pay for the investments? The regions had retained much of the profits, while Oslo had taken the biggest costs.From Bergen, PwC had built up Norway's largest private investigation department. The department was a gold mine for the partners in Western Norway. The problem was only that most of the scrutineers had an office and residence in the capital. Grotli made changes. He also formally moved the investigation department to Oslo, with a new Oslo manager and a branch office in Bergen. Proceeds from the inquiry were no longer reserved for the partners in the west. The decision was perceived as unreasonable by some. Under Grotli, consulting in the areas of risk, corporate governance, internal control and management support — Risk Advisory Services — was established as its own business area. People were picked from all over the organization. Responsibilities given to the new department had previously been spread over several. Partners lost earnings when tasks were taken over by others. In the world markets, the financial crisis raged. But for PwC, the arrow still pointed upwards. Under Grotli's leadership, revenues topped NOK 2 billion for the first time in 2009. In tailwinds, the firm was to stretch even further. The target was three billion in revenue in 2013. Or as it said on a button on Grotli's lapel: “3 in 13.”

Power of attorney. It was October 2010. Knut Grotli had just stood in front of several hundred employees in the main hall at Oslo Plaza and launched the accountancy giant's new, global profile. The new, fan-shaped logo was supposed to signal a clearer and value-oriented audit house. On his way to a board meeting he was taken aside by partner Geir Julsvoll, the man who a few years earlier had received criticism for losing DnB Nor. Julsvoll had become chairman of PwC. Now he had something important to announce: the party leadership no longer had confidence in the CEO. In the days before the board meeting, a group of partners had been working on obtaining proxies. Partners were called up. Several were persuaded. It ended with a majority. Grotli was sacked as a direct-dare. One of the active to get rid of him, was the chairman himself.It did not help to be popular among the younger partners, when they did not have the right to vote. The decision had already been taken by the partners by force. Grotli never entered the board meeting. He turned and left the glasshouse in Bjørvika. Håvard S. Abrahamsen, who had lost the battle for the leadership position a few years earlier, had agreed in the days before the board meeting to put himself at his disposal if Grotli dropped out. He took over with immediate effect. Grotli mused: “I do not experience this process as orderly,” he told Aftenposten's online edition the following day. “A process I experience that is not in line with PwC's values,” he continued, threatening legal action. Then it went quiet. Grotli agreed with PwC on a final deal, taking a one-year job break, training and climbing Mount Everest, before stepping in as partner and deputy managing director at rival audit house BDO. Today Grotli tells DN that he will not comment on his time at PwC, beyond that it was “educational” and contributed to useful “experiences”: “The importance of building an environment of clear leadership, willingness to invest in development, open processes, loyalty to decisions, clear and defined goals - and a real desire to do each other good - are key elements here.

Partner Håvard S. Abrahamsen took over as PwC CEO the same day Grotli disappeared. He was also a candidate the time Grotli got the job. He still leads the company today. Knut Grotli had made himself unpopular.— The board with the support of the partnership wanted a new CEO who brought the partners together. More than that I can't say. It's an internal matter,” says Rita Granlund, partner and audit leader. “The process was as it has been with other CEOs. The board will talk to the partners and see what the mood is like,” Granlund says. “There are not too many other ways this could have been done. Grotli's dismissal provoked reactions: “Knut Grotli and his circle reacted, and then it came out in the press that it was an unethical course of action. That, of course, created reactions. But we don't agree. The position of director is a position of trust, a partner who represents all the partners and must have the support of the partners,” says Granlund. Chairman and partner Geir Julsvoll says that the Board is responsible for ensuring that the most suitable partner has the chief job. “Our processes for selecting the CEO are not open election campaigns,” he writes in an email to DN.

Partners disappear. When the status was made up in June 2012, 17 partners had disappeared out of the firm in the past year. At the same time last year, only Grotli was gone, according to the firm's annual transparency reports. In the past year, eight PwC partners have thanked for it. Some have disappeared because of age. Younger partners have quit in favor of competitors and other companies. Talents have left the firm. DN has spoken to a dozen employees and partners who have quit PwC. Many do not want to come forward and speak out about their former employer. Several tell about conflicts related to the distribution of money, responsibilities and promotion. Others say that these types of conflicts are not uncommon, but will always be found to a greater or lesser extent in large, partner-controlled firms. Øyvind Forberg Sletten would rather go to KPMG. He came in as a partner at PwC when his accountancy firm at Jessheim was acquired. He never quite found himself at ease. As a partner, he became more of a salesman than an accountant: “It became a rush to get enough assignments, and the right assignments. It was a competition to work the most overtime possible. In my eyes it costs more and you wear people out. Ole Andreas Kahrs has joined the consulting firm AT Kearney. He won't say why he quit: “The only thing I can say is that I wish PwC the best of luck. Of the talent pool that was hand-picked by Kjørsvik, few remain on the payroll. For Thor Kristian Korsvold, a managerial job at Reitangruppen was more exciting than continuing a partner career at PwC: “I was given an opportunity to test my abilities as an operational performance manager, which had been a latent desire for a long time. It is a very different reality from being a professionally rooted accountant or adviser.In recent years, the law business of PwC has also been sharply shaved. Several reputable tax lawyers have left the firm. Partner Hanne S. Holen had worked 26 years at PwC when she, and three others, went to the law office of Arntzen de Besche last summer. There, Holen quickly rose through the ranks. Now she leads the law community as the firm's managing partner. After Holen quit, the management of PwC's law firm was replaced. “I think this is a good solution for PwC and facilitates the way forward,” Holen says. She adds that she still has high thoughts about PwC as a firm.

Håvard Abrahamsen, CEO of PwC, says that changing the head of PwC's legal services was natural and sensible: “It's no secret that the law firm has a new leader. We wanted one leader for both the national group and for the law firm in Oslo. It was a natural and sensible process,” he says. In the investigations department, several experienced scrutineers have quit in the last two years. This summer, the department in Oslo was without a leading partner when Jan Erik Gran Olsen disappeared. He is now in the process of shoring up the investigations department at KPMG, while two of his closest associates have gone to rival BDO. Olsen told DN he doesn't want to comment on his own departure. Partner Helge Kvamme, who had national responsibility for research at PwC, also quit this summer. Kvamme has begun with an inquiry at the law firm Selmer.

Friendship and Strategy. “The rise in consulting services has had a devastating effect on the culture of large auditing firms,” says Professor Dana R. Hermanson in the article “How consulting services could kill private-sector auditing.” Hermanson is a professor at the American Kennesaw State University and has written several books on the auditing industry. He believes the mix of auditing and consulting has created a high level of conflict in audit houses. Because consulting services are often far better paid than auditing, quarrels arise over compensation and the distribution of dividends. “The internal banter can drain the firm of energy,” he continues. The question is whether precisely that was about to happen at PwC.— It is a tough environment in the big companies, it is a business that requires standing up. Then it is also easy to disagree,” says Tore Hoem, who headed PwC's law office in Central Norway until autumn 2012. Now he has the same role at BDO. He was himself at the bottom partner level of PwC, so-called national partner like some 90 others. Unlike the currently 49 international partners in PwC Norway, the national partners do not have voting rights.— It is really a rather unpatriotic way of doing business. Those who stand on the most and are actively working are usually the national partners. Then others have come up to a higher level and earn disproportionately much for the job they do. That, of course, creates dissatisfaction,” says Hoem, pointing to the large income disparity between partners at PwC. A review of the tax lists in recent years shows a range in partners' equation incomes from £14 million to a couple of million kronor annually. Nils Eriksen had been a partner at Arthur Andersen, at the international law firm Baker & McKenzie and worked as a tax adviser at the OECD, before joining PwC. He believes part of the problem at PwC was the lack of career plans. Eriksen quit and became a partner in the law firm Grette.— There were no objective criteria for what it would take to be promoted at various levels, and the proceedings were deficient. It was also difficult to address issues without this entailing a risk of adverse consequences. A lot of good people chose to quit. Eriksen believes conflicts of interest easily arise because PwC is doing so well. “There will quickly be a crash between what is in the firm's best interest in the long term and some partners' short-term desire for high withdrawals. If the overall corporate interest is to be the guideline, measurement indicators for partners must make it clear.

More than NOK 4 billion has been distributed to PwC's Norwegian partners since 2003. The number of employees has doubled from around 800 to 1650, while the number of partners with voting rights has been between 40 and 50 people over the same period. At most, revenues at PwC rose between 15 and 20 per cent. Now the curve has flattened out. Last year, growth was just under two per cent, according to the 2012 accounts. The current year growth is around six percent, according to the company's management.— The financial crisis of 2008, of course, played a role, and the removal of the audit obligation for small companies. We sold a firm in Alta and Harstad, and two key partners have quit our law business,” says Rita Granlund, partner and head of audit at PwC.

Regrets. At home at Økern, former top manager Jørgen Kjørsvik sits with memories of his time at PwC. It's been several years since he stopped by the audit house, and he won't comment on what's going on there now. But he's still paying attention. On the young accountants he recruited. Which he thought was going to take over at PwC.— Unfortunately, many of the partner talents who were trained and teased quit to become partners. It's a shame. PwC could have been incredibly strong today, had they been able to hold on to them,” says Kjørsvik. He is proud of the company he helped develop. And says he has great confidence in the quality of the junior partners and employees today who sit with great responsibility and will steer PwC into the future. But he can't help but wonder what's about to happen, why so many have quit since he even thanked himself in 2009. He knows nothing but what he himself witned.— When partners think, “How much can I contribute to develop our company before I give myself as a partner?” , then everything is going in the right direction. However, everything changes when you think “How much can I get out of this system before I quit?”. How did you stay calm in the ranks? “Leading an organization with partners is like herding a pack of cats,” it said. Leadership must be built on a mixture of humility and tenacity. You can't lead by giving directives, you have to crawl on your knees and beg to be allowed to lead. But you need to know the direction and how to get the people to pull the glass together.One thing Kjørsvik regrets that he never did anything about: the arrangement of two levels among the partners. His plan was to remove the scheme and get one partner tier. So far he never got. -- You get an upper stratum that sits with the votes and a large undergrowth of partners who don't have the right to vote. You get constellations of power, some won't let others in because then they get diluted their influence. It can be a danger to organizational development and the possibility of retaining good talent.

Proud of the company. In the corridor at PwC in Bjørvika, employees stand in line. A week before Christmas, the gift giving is underway. At stands, employees can pick up a new Iphone, latest model. The choice is between cover in gold, black or silver. From the company everyone gets an alpaca rug knitted by women on an aid project in Peru.— We are very proud of PwC, says CEO Håvard S. Abrahamsen.— “If we had not had discussions, we would not have been able to run this company so well. It's high under the roof, and that's what brings us further.In the top-floor boardroom, amid leftover pastry and cuts, he and head of audit Rita Granlund present blueprints of global employee surveys at PwC. Norway is doing very well, better than most other countries. Among those who have quit, nearly 80 percent say they may consider working at PwC in the future. “The figures show that the overwhelming majority are not quitting,” Abrahamsen says. They believe that the number of partners who have quit is unproblematic and emphasize that more have quit because they have reached retirement age. “Over the last four years, there is a 2 percent turnover at partner level excluding pension and sale of office. You'll probably find as many reasons as the number of partners who have quit,” Abrahamsen says. “And of course we would have liked to have kept the young, bright talents.

Abrahamsen does not recognize himself in the descriptions given by former employees and partners of the company.— It will be at their expense. We are keen to bring out the whole here. Many people are proud to work at PwC. “There's also a point here that some of the people you've talked to are now working at competing companies,” he says. “We don't have 140 partners who agree on everything. But if it had been as conflicted as some people claim, how would we have managed to do so well? asks revision manager Granlund. The management of PwC believes that even they have known and objective criteria for promotion. “We have robust and well-established procedures. Becoming a partner at PwC is a demanding process. It's about, among other things, what you can deliver to customers, what you can contribute internally, whether you motivate employees and what you contribute professionally,” says Granlund. The two-tier partnership arrangement, which former CEO Jørgen Kjørsvik regrets not removing, is necessary in a small country like Norway, believes Håvard S. Abrahamsen.— The need is there. Norway is a special country with many small customers in the regions, and then we need more mission responsible partners. Nor would PwC globally accept all of these being promoted to international partners.

Does the system create constellations of power? “Without thorough processes around the evaluation of remuneration and promotions, there is always a risk of abuse of power. But not when we have processes as robust as we have,” Granlund says. Abrahamsen disagrees that the top partner layer of the firm gets too large a share of profits. When some earn more than others, it is because of differences in performance, responsibility and internal roles, he believes: “It is not right that the international partners work less than others. Abrahamsen does not recognize that some of the partners in PwC have become more concerned with their own earnings than with the interests of the firm. — I strongly reject that. I think all the partners want to work for PwC's best interests. I think they do, and I expect them to. ●line.dugstad@dn.no