Unfortunately, it got the wrong kind of innovation. The Big Four have:
Facilitated the concentration of corporate power. When a KPMG report found that 83% of corporate mergers produced no benefits, and half actually made the companies involved poorer - though not of course the deal-makers in the Big Four - managers tried, and failed, to suppress it.
Built up cosy relationships with their audit clients - and that got in the way of proper public scrutiny. Aided aggressive tax minimisation for the biggest companies in the world, via legal tax havens and other tricks. They have thus been undermining the ability of democratic governments to get things done. The UK government alone estimates it loses up to $25 billion a year in this kind of tax avoidance.
Earned about £22 million from the UK aid budget (1999-2000) for consultancy and advice (that figure applied when they were the Big Five, including Arthur Andersen).
Contributed $13 million to political funds in the US election year of 2000, including $700,000 to George W. Bush.
Number of accountants in the UK
1904 6,000
1957 38,000
1999 109,000
Five Brothers:
The rise and nemesis of the big bean counters
Andrew Simms
New Economics Foundation, 2002
ISBN 1889407456
