Date posted: 12/07/2020 10 min read

Know the numbers: Stephen Harrison AO FCA

Stephen Harrison AO FCA started as an academic and statistician but ended up in charge of the Global Accounting Alliance.

In Brief

  • Stephen Harrison AO FCA become one of the most influential people in local and international accounting.
  • At the ICAA, he boosted engagement with government to find a balance between regulation and self-regulation.
  • One of Harrison’s greatest accomplishments was helping drive globalisation of the accounting profession.

Stephen Harrison FCA was warned against becoming an accountant. As a bright young scholar, he was slated by his school’s career counsellor to become a doctor. But he couldn’t bear the thought of cutting someone open, so chose to study economics, accounting and economic statistics at the University of Sydney.

He could have done honours in all three subjects and spoke with the head of accounting, Professor Ray Chambers, about whether to choose accounting. “Harrison, don’t even think about it,” Chambers fired back. “That ended my accounting aspirations,” he says.

It was decades before he re-engaged with the profession and went on to become one of the most influential people in local and international accounting.

An unlikely candidate

After eschewing accounting, Harrison took honours in economic statistics. On graduating, he was offered a full-time teaching job at the university. From 1967 to 1991 he had stints as the university’s statistician, deputy principal and bursar.

By the 1990s, he believed he had few options left at the university and faced a decision. “Would I stay on and get a great pension, or would I leave, sacrifice the pension and do something I hoped would be different and fulfilling for the remainder of my working life?”

By chance, friends had put his name forward to become chief executive of what was planned to be the new accounting body in Australia with the merger of CPA Australia and the Institute of Chartered Accountants in Australia (ICAA). Following a selection process, he was chosen. But the merger vote failed and there was no job.

A day later, ICAA President Nick Burton-Taylor rang Harrison to say the Institute’s executive director was resigning. Would he like the job? “I said yes and that’s how I became involved with the accounting profession, despite all of Ray Chambers’ suggestions.”

Stephen Harrison AO FCAPicture: Stephen Harrison AO FCA. Image credit: Richard Pender-Brookes.

For the love of the profession

When he joined the ICAA, Harrison was impressed by the energy and effort accountants were prepared to give to the Institute and their profession.

He says professions are established on two principles: they will act in the public interest and they are self-regulating. “The true professions are those that set up their own code of conduct and have the appropriate disciplinary powers attached to enforce it.”

As executive director and later chief executive officer of the Institute, Harrison had significant achievements. He boosted engagement with government to help find a balance between regulation and self-regulation.

The profession also began providing data to policymakers, including Treasury, which significantly improved their understanding of economic activity.

“The Institute was also responsible for providing to the government significant research and support for the introduction of the GST in Australia,” says Harrison.

With litigation threatening the viability of accounting firms, Harrison was part of the team that, in 2004, succeeded in having auditors’ liability capped in every Australian state, except Tasmania initially. He regrets not securing proportionate liability alongside capping.

“Logically – but the lawyers don’t see it this way – proportionate liability is more important. I don’t see why, for example, when a company collapses and the lawyers decide they’re going to sue someone, they can sue them for the whole of the liability attached and not distribute that liability proportionately among the contributors. I’m disappointed we didn’t get that done.”

A global mindset

Perhaps Harrison’s greatest accomplishments are on the international stage, by helping to drive globalisation of the accounting profession. “I became committed to looking at the accounting world through a global lens and trying to further those areas where I could have a role and some influence,” he says.

Harrison attended his first meeting of the International Federation of Accountants in November 1991, but he saw the need to create a smaller grouping of the more influential institutes from larger economies.

In 1994, with support from the ICAEW, Harrison created the Chartered Accountants Group of Chief Executives (CAGE), bringing together seven of the world’s leading chartered accounting institutes. In 2005, it “progressively transformed” into the Global Accounting Alliance (GAA), now encompassing 10 accounting bodies in significant capital markets. He says CAGE and GAA are among his proudest achievements.

In 2006, a year after Harrison retired from the ICAA, he was asked to become GAA’s part-time CEO, a position he held until his retirement this year.

Harrison can now reflect on his career and the outlook for the profession. He believes accounting is in a process of constant improvement, as well as “facing challenges we thought we’d solved, but which need to be solved again in slightly different ways”.

These challenges include, he argues, making the setting of the profession’s international ethical and auditing standards more independent.

Keep career options open

“Auditors are taught to be sceptical,” Harrison says. “To be sceptical, you’ve got to understand what’s going on. I’m not sure that today, in this world of rapidly moving and powerful technology, too many people can put their hand up and say, ‘Oh yes, I see the big picture. I understand that.’ And there’s a real risk attached to that. For me, this is a critical component of the skill set of a chartered accountant and opens up many career options.”

To succeed in today’s environment, accountants must not only be technologically proficient, but versatile when considering their future pathways.

“Whatever training you take on, whether it be tertiary or vocational, you need to make your pathways as flexible as possible,” he says.

“Universities need to be constantly changing the way in which they bring their degrees together and what they’re trying to equip graduates with.”

Accounting remains a great career, he adds, as it is core to so many activities, including consulting, advising, financial reporting, assurance and setting up a business.

“People who continue to think of accounting as a boring technical subject lose many opportunities. It is an introduction to so many different areas.

“A piece of advice students should remember when making their education and career decisions: accounting provides many options and a set of core skills.”

Unstoppable commitment

Throughout his career, Harrison has had a deep commitment to his role. His cardiologist once dramatically announced that Harrison’s “heart was stopping” and he was escorted to the emergency ward to be fitted up with tubes and leads.

Harrison told the hospital staff he had a GAA teleconference. “No way,” they said. But he got his way, and later he was sitting in the hospital waiting room on the call.

“I progressively became committed to looking at the accounting world through a global lens and trying to further those areas where I could have a role and some influence.”

That dedication was rewarded in 2000 when he was made an Officer of the Order of Australia (AO) “for service to the accountancy profession, nationally and internationally, to administration of educational institutions, and to the community”. Shortly before he retired from the ICAA in 2005, he was also made an honorary fellow of the Institute.

“I never expected to be doing what I did,” he says. “My overwhelming feeling is what fabulous people I’ve met, and what contributions people continue to make in a profession that’s so critical.”