As professional services firms evolve, are they doing enough to preserve what makes partnership worth aspiring to?
Richard Houston’s reported 45% increase in remuneration to £7.1 million at Deloitte certainly made for an eye-catching headline in the Financial Times.
But another recent article caught my attention.
EY’s average UK equity partner pay has reached a record £870,000, an increase of nearly 11%, despite revenue growth of just 2.1%. Meanwhile, the firm has reduced its equity partnership to its lowest level in five years.
At Deloitte, changes to the partnership structure have included reducing initial equity allocations for newly promoted Partners.
Individually, these decisions may make commercial sense. But taken together, they raise an interesting question.
If the financial rewards of partnership are increasing, while the route to meaningful equity becomes more selective, what happens to the ambition of those coming through behind today’s leaders?
The changing appeal of partnership
For generations, partnership has represented far more than financial reward.
Ownership. Influence. Autonomy. The opportunity to build something meaningful and have a genuine stake in the future of a business.
But professional services firms are changing.
They’re becoming larger, more international, more commercially driven and, arguably, more corporate in how they’re led.
As decision-making becomes increasingly centralised and partnership structures evolve, are the benefits that traditionally made partnership so attractive changing too?
For ambitious Directors and aspiring Partners, reaching partnership involves years of commitment, building client relationships, developing teams and demonstrating commercial value.
If the route to equity becomes less transparent, or the opportunity to influence the business becomes more limited, it’s reasonable that some individuals may begin to question what they’re working towards.
That doesn’t necessarily reflect a lack of ambition.
Perhaps ambition is simply evolving.
The question may no longer be just “How do I make Partner?” but “What kind of Partner do I want to be?”
What does this mean for succession planning?
This is where I think the conversation becomes particularly important.
The long-term success of any partnership depends on the strength of the leaders coming through behind its current Partners.
But identifying capable successors is only part of the challenge.
Firms also need to understand what motivates those individuals. Is it financial reward? Recognition? Greater autonomy? The opportunity to build a practice or influence the direction of the business?
For some, partnership within a major international firm will remain the ultimate ambition.
For others, the opportunity to join a smaller or mid-tier practice, where they may have more direct influence, greater independence or a clearer route to ownership, could become increasingly attractive.
And that presents both a challenge and an opportunity for firms competing to attract and retain senior talent.
Succession planning isn’t simply about developing people who are capable of becoming Partners. It’s about creating an environment in which they genuinely want to.
Preserving what makes partnership worth aspiring to
Of course, professional services firms need to evolve. Strong leadership, commercial discipline and profitable growth benefit the wider business.
But as firms modernise, they need to remain conscious of what has historically made partnership such a compelling ambition.
A genuine stake in the business. The freedom to shape its future. Recognition for the value created.
Because ultimately, the long-term success of any partnership depends not only on today’s leaders, but on the ambition of those who aspire to follow them.
Are professional services firms doing enough to preserve what makes partnership worth aspiring to?