An Interview with Yap Seng Chong
Yap Seng Chong at his home office in Malaysia
Photo: Yap Seng Chong
Please tell us about the HR characteristics of your organisation.
Ernst & Young (EY) Malaysia has 12 offices, and our audit clients account for 30% of the market capitalisation in Malaysia. We have a total workforce of around 4,500 employees nationwide. While this is quite a sizable workforce for a leadership team of more than 100 partners to manage, we are still a very small operation compared to EY’s global workforce of 312,000 people in 150 countries.
As everyone knows, auditors work long hours and always have tight deadlines to meet. Given such a demanding working environment, we have a high employee turnover rate which was more than 30% in FY21. On average, our non-managerial employees stay with us for 2.2 years, whereas our managerial employees typically have a tenure of 10 years or more.
Given our high staff turnover, we hire all year round for both experienced professionals and entry-level employees. However, we do have a major recruitment drive every year to recruit fresh university graduates. We also hire interns to work for us during their school holidays, with the hope of converting the good ones to permanent employees after they have graduated.
Is the Great Resignation happening in Asia?
A trend that saw millions of people resign their jobs in the US and then Europe in 2021, is currently a matter of concern across the Asia-Pacific, with reports of talent shortages in Malaysia, Thailand, Indonesia and the Philippines. Photo: RealisticFilm / iStock
What attributes did you look for while hiring new employees?
Given the demanding and complex nature of our work, we look for candidates who are technically competent, meticulous, inquisitive, resilient and versatile. They must also be good team players since we often work in teams. Being able to support each other effectively could make the stressful work environment a lot more tolerable.
Since we spend much time working directly with our clients, some of whom can be quite difficult at times, we require our colleagues to have good people skills. They need to be open-minded, objective, observant, perceptive, diplomatic and have a good sense of humility.
However, integrity is the quality we cannot emphasise more in our line of business. We expect our colleagues to be highly ethical and able to make the right judgement calls in ambiguous situations. Many of us had seen how the once-largest professional auditing firm Arthur Anderson LLP was brought down by the Enron case.
Does EY recruit on university campuses? Do you recruit overseas graduates? How do you compare local Malaysian graduates with overseas graduates?
Yes, we recruit graduates from both local and overseas campuses. For overseas recruitment, we participate in job fairs in cities with many Malaysian students, for example, London and Melbourne, targeting young Malaysians who might return home to work for us. As long as they have the right traits to be good auditors, we welcome them regardless of where they are educated.
Generally speaking, overseas graduates have a better command of English and they can therefore communicate better. They often have a broader outlook as well, having lived abroad. However, we do have some very eloquent and capable employees from the top local universities, too.
You had spent more than 30 years with EY. How have the HR needs of EY changed over the last 30 years?
30 years is a long time and many things have changed since I joined EY as a fresh graduate. Most significantly, our clients have grown in size and their business transactions have become a lot more complex. As a result, we need a larger team to serve each of these clients.
The rise of the millennial workforce
It is forecasted that by 2025, as much as 75% of the global workforce will be millennials, bringing a whole new set of demands and expectations on the modern workplace and its culture. Providing a collaborative and inclusive work environment will be more important than ever. Source: EY Careers on Facebook
We had approximately 300 auditors when I joined the practice in 1986 and we now have a headcount of more than 1,600. Because of the volume of our work, our employees have also become more specialised, either in the industries they serve, or in the nature of the audit work they do. As you can imagine, we need a very strong and proficient HR department to manage a professional workforce of this size, especially when we have such a high staff turnover. On top of that, we have to constantly compete with other firms for the talents we need to sustain our business. Needless to say, we also have a very robust and comprehensive HR process to manage our recruitment, retention and people development, which has evolved over the years.
In short, HR is a constant challenge to us, but I guess it is also one of our competitive advantages.
How about the employees? How do you compare yourself to the new recruits of EY today?
Well, Malaysia has been developing fast in the past decades, and every generation grew up in quite a different social environment. So it’s probably unfair to compare generations of employees directly, but I can share some personal observations about our young colleagues today.
First of all, young people today are more sophisticated socially and financially. Instead of single-mindedly trying to ‘make money’ and become rich, as we tended to focus on in our younger days, they are driven by making decisions that lead to financial stability. I think this is a reflection of society becoming more affluent, and they no longer have to worry about feeding themselves and having a roof over their heads. Instead, they tend to pay attention to things like work-life balance and giving back to the community. Because of such social awareness and health awareness, they are less hesitant to leave a job when they think they cannot achieve the balance they seek, sometimes without having a new job secured.
Secondly, our young employees today are certainly more at home with technology. They were born around the time or even after products like cell phones, the internet and personal computers were introduced into the market. Most of them cannot even imagine a world without email, mobile phones and Google, which is the world we grew up in. They are the so-called digital natives, and they are quick in learning how to use digital tools to help them in their daily work.
Lastly, they are certainly better multitaskers than we are. I think this is because they were brought up in a richer and more complex environment in which a wide variety of things were constantly stimulating their senses. They have learned to juggle multiple tasks and multiple responsibilities better than we do. Compared to them, we sometimes find today’s world too hectic and we have to try harder to shield ourselves from all kinds of distractions.
Yap Seng Chong visiting the Natural History Museum when he worked as a young auditor in London during the early 90s. Photo: Yap Seng Chong
I understand that you served regional clients and worked with EY offices in different countries. Are there differences among EY employees in these offices from country to country?
Not really. I didn’t see significant differences among our employees from different countries in the region. This is probably because accounting practices and auditing standards are quite uniform across different jurisdictions in today’s globalised business environment.
In our HR practice, we have pretty uniform hiring criteria and preferences in different country offices. Because of that, we have accountants and auditors who are highly versatile and adaptable at all levels. They follow very similar processes and share the same values. Most of them are good at handling multinational clients and collaborating with colleagues from other countries. In fact, this is how we commit to delivering seamless and consistent audit services to our international clients.
What attributes did you look for when you tried to identify employees for promotion into leadership roles?
We expect our managers and partners to work with multiple clients and lead multiple teams. So, besides good technical skills, they are expected to have good project management and time management skills in order to lead well in a very demanding work environment. Knowing how to prioritise and being resourceful are also very important qualities to possess when there are always important deadlines to meet.
We also expect our leaders to have good people skills. They must command the respect of our clients and those who work with them by being proficient and impartial, but understanding and open-minded at the same time. Humility and empathy are therefore two important traits we look for when we try to identify our future leaders. They must also exercise good self-discipline so that they can set an example for those who work with them.
Lastly, but most importantly, we look for integrity. In fact, integrity is what defines our line of business and what we commit to. Our leaders must be able to exercise good judgement in order to make responsible decisions and recommendations based on their professional knowledge. They must also have the courage to defend their professional decisions and recommendations when they are challenged.
To prepare its workforce and business for the future of work, EY has introduced a series of global talent programmes, including LEAD, a framework that connects people’s career, development and performance. It features a digital personal dashboard that provides an intuitive way for EY people to view their feedback from teams, and track their progress in real-time, placing the focus on individual’s career journey and aspirations. Source: ey.com
Is employee retention a major challenge in EY? Please tell us about your retention strategy. What do you think is the most effective way to cultivate loyalty with your employees?
Employee retention is indeed a constant challenge for us and there is always a war for talent out there. The weakening of the Ringgit is making it worse because our employees have some universal skills that are in high demand in the neighbouring countries.
The most basic strategy for employee retention is of course making sure they are fairly compensated. This has to come with a highly transparent performance evaluation and compensation system that ensures the perceived value of and contribution by the employees are aligned between the company and the employees themselves. To most professionals, a fair employer is probably more important than a generous employer.
Employees also need to feel that they have some degree of control over their work. In other words, they need room for decision-making instead of just following orders. When they make decisions, they have a sense of ownership and are more likely to have a positive attitude even when the work gets tough. On the contrary, if they are just passive followers, they are more likely to develop negative emotions that spread among the team and erode loyalty.
A sense of pride is also important. For this, we have our strong brand to leverage, and we regularly invest in publicising our talent brand to remind our employees that we are a prestigious employer where good people choose to work. To use a Chinese metaphor, we pride ourselves as the Shaolin Temple of professional services where the chosen ones learn to become the best in the field. We augment that by offering referral bonuses to encourage our employees to bring their friends into our workforce. When you bring in a friend, you endorse your employer and you’re less likely to leave.
We also invest in our employees’ well-being and professional growth to try to extend their tenure with us. For example, we allow flexible working hours and remote working arrangements as long as good work is delivered and deadlines are met. Our employees are also given time off and support for professional development. In addition to on-the-job coaching, each of our audit professionals spends at least 40 hours each year on professional education to keep abreast of new technology, emerging issues and changes in professional standards.
Did the COVID-19 pandemic affect your HR policies and practices? How and why?
The last two to three years were certainly a very taxing period for our HR department. As we navigated the remote working challenge, keeping our employees engaged was very crucial. While we set up and sustained virtual teams to continue with our work, we also had to provide additional counselling to make sure our people stayed engaged and connected.
Fortunately for us, we activated our global crisis management plan even before the World Health Organization declared COVID-19 as a pandemic. That provided us with a set of uniform response protocols for the coordination of travel, meetings and events. It also helped us to manage infection cases in our offices and to protect our workforce through contact tracing, safe workspace practices and other safety measures.
In the longer term, the pandemic has certainly given us the opportunity to re-examine our HR practices and respond to the greater awareness among our employees about work-life balance. There is definitely a need to put in place some new policies to sustain a more agile and resilient workforce while continuing to attract and retain the talents we need. Higher flexibility in working hours and remote working are two areas we are experimenting with.
Many jobs are being disrupted or even replaced by automation tools supported by artificial intelligence, big data, robotics and other forms of technology. Are professional services provided by EY being disrupted too?
We serve a wide variety of clients across many sectors. In the past decades, almost every industry had to continuously adapt to the new social and business environments brought about by technological advancements, especially progress in internet technology and mobile technology. In order to serve the needs of our clients, we need to adapt, too. The COVID-19 pandemic has also pushed us to adopt new technological tools to sustain our work and to keep our employees safe. However, technology is more of an enhancement to our work than a disruption, at least for the time being.
EY Canvas, EY Helix and EY Atlas are the three foundations of EY digital audit: EY Canvas is their online audit platform; EY Helix is their data analytics platform, and EY Atlas is their cloud-based knowledge platform that delivers the latest accounting and auditing content. Source: ey.com
Generally speaking, technology has impacted us in the following ways:
First of all, we use digital technology to streamline our audit workflow and documentation. That helps to make us more efficient and gives us better control of our processes. Our global digital audit platform also helps to standardise our methodology and provides better data security. All these translate into higher quality audit work for our clients.
Secondly, technology helps us to communicate better among ourselves and with our clients. Instructions, requests and feedback can be instantly communicated and properly routed through the client portal on our digital platform. A primary audit team can also direct execution and receive timely updates from audit teams in multiple locations.
Thirdly, a suite of data analyser tools on our technology platform helps us to organise and analyse audit-relevant data, assess risks and produce audit conclusions. With the help of such tools, we can handle a larger amount of data in a shorter time, and produce more robust analytical output.
Going forward, we expect to integrate other more sophisticated technology into our audit processes. We foresee a higher degree of automation, and the use of AI in risk assessment, for example.
As a very experienced recruiting manager, what advice do you have for new graduates hoping to build a career in a prestigious professional firm like EY?
Draw up a realistic plan for your career, set ambitious but achievable goals, and keep your focus so that you can build technical depth over time. At the same time, learn to be flexible, resourceful and open-minded so that you can develop the ability to adapt to the fast-changing environment.
YAP SENG CHONG
Yap Seng Chong graduated with a Bachelor’s Degree in Accounting from University Malaya in 1986. Yap had his entire career with Ernst & Young (EY), which spanned 35 years, two of which were with the London office, providing various types of assurance and business advisory services across a diversified clientele portfolio. He had previously held positions in EY as Head of Assurance Practice, Professional Practice Director and ASEAN Regional and Country Independence Leader prior to his retirement in 2021.
He was a member of the Interpretation Committee of the Malaysian Accounting Standards Board. He had also served in various capacities, including Chairman of the Disciplinary Committee and Chairman of the Audit and Risk Committee, when he was a Council member of the Malaysian Institute of Accountants.