Making Professional Mergers Successful

1. Making Professional Mergers Successful One Profession’s Experience Presentation to the College of AB Professional Foresters June 19, 2014 John Carpenter MBA, FCGA, ICD.D CEO Alberta Accountants Unification Agency

2. Presentation Overview Why did Canada’s three accounting designations decide to merge? The process Challenges Things we’ve learned Defining success

3. Merger Process Extensive discussions and failures, in Canada and elsewhere, over many years In May 2011, Canada’s CAs and CMAs announced their intention to unify under the CPA (Chartered Professional Accountant) banner. Nationally CGAs joined the unification process later But professions are provincially regulated and in Alberta, CGAs lead their national body into the merger – welcome to Canada!

4. Why Merge? • Eliminates marketplace confusion over differences between the designations. • Strengthens international influence of profession and the people who rely on us (clients) • Helps recruit to the profession. • Reduces inefficiencies in governance and administration. • Scale • Strengthens ability to serve members. • Member relevance

5. The Process Keys to a successful process: • Work from a common set of merger principles • Consult and communicate with members • Lead members – you must ask BUT they are looking for you to tell • Respect the importance of history/legacies • Be decisive – don’t be deterred by naysayers • The status quo will resist

6. The Process What the accounting profession did: • Extensive member communications and town halls • Responded quickly, aggressively & positively to misinformation • Used member polling to identify issues, and assigned qualified teams to resolve those issues. • Set up leadership groups that incorporated all parties. • Identified “champions” within the membership

7. The Process What the accounting profession did: • Stayed focused on our stakeholders – including the public interest • Ensured standards of education and competency would be maintained. • Exploited and shared best practices • We can do better than the current standards • Kept government informed. • Negotiated protocols and agreements that codify each party’s commitments.

8. The Process Alberta Accountants Unification Agency has taken shape! • Transitional body designed to become CPA Alberta • Prepare for the responsibility we are seeking • Be ready when they hand you the keys • Vital in rebranding, establishing new organization, liaising with government and with national counterparts.

9. The Process Unification Agency Achievements to date: • 2014/15 strategic plan, budget and business plan in place • Transitional management structure in place • Merged work: • Business development/recruiting • Education • Regulatory (Practice review, discipline) • Communications, marketing, public relations, government relations • IT • CPA Life: services to members, events • Corporate Services • Premises planning

10. The Process Other achievements to date: • Post-secondary institutions on-board and delivering CPA pre-requisites • New national CPA education program (PEP) introduced in Alberta in fall 2013 • “PREP” bridging program introduced for degree-holders who don’t have CPA prerequisites • Legislative timeline in place for 2014

11. Challenges The road to success is dotted with many tempting parking spaces. Will Rogers

12. Challenges • Not everyone arrives at the same point at the same time. • All changes involve some loss, and a merger is a major change. • Opponents will attempt to create obstacles. • You can get buried in the paperworkand process BUT good paper makes good partners. Invest seriously up front • Staff cultures are real and entrenched • Employment threats or risks (real or perceived) will create challenges • And volunteers will worry about their fate too

13. Things We’ve Learned Move on consolidation quickly. Get ahead of barriers and naysayers Build and maintain trust at staff, member, governance levels Members can “get there” first and lose patience Honour what is being lost (old designation, old affiliations, etc.). It’s about the future! Build a leadership team built on talent, not old arrangements. Commit to listening to your opponents, but not giving in to them. Move quickly on disinformation – vacuums will be filled by someone Keep an open mind, and be flexible in recognizing changing landscape.

14. Things We’ve Learned • Know your stakeholders and keep them engaged. • Members • Government of Alberta • Employers of your members • Industry sectors • Post-secondary sector • Counterparts in other provinces • Other regulated professions • Who really cares besides you – confront the brutal facts • It’s NOT the best of the merging bodies – it’s the best period! • Stay alert to hidden takeovers while in transition

15. Things We’ve Learned You need to communicate regularly and openly with members. Keep your eyes on the prize; don’t be tempted by those parking spots along the way to your destination. Develop a thick skin. Stay focused on what’s important to achieving success, and do your best to ignore the noise. Find and follow the true believers Delineate the governance, staff and working roles early and well Transition to new roles and structures in a clear orderly way When you stop promoting legacy brands you must promote the new one

16. Defining Success The accounting profession will achieve success in unification if the final goals are met: • GOA passes and proclaims legislation. • Member support stays high. • Members find relevance • New CPA designation is embraced by stakeholders. • Employer and client needs are met. • Recruitment into profession stays high. • New unified regulatory and member services body meets mandate while achieving efficiencies.