This week on the podcast Matt sits down with Barbara Marchini-Ellis, Partner at EY. They begin the episode with Barbara discussing her journey through the accounting field, from her diverse background in Silicon Valley to leading EY’s work with Walmart in Northwest Arkansas. Barbara then walks through how the accounting industry has changed during her 35 years of experience, touching on the importance of business ethics and integrity. The conversation concludes with Matt asking Barbara what has kept her at EY for the entirety of her career and Barbara’s work with the Endeavor Board in Northwest Arkansas. 

I'd say the progression I've seen is a

lot of times it was entrepreneurs coming here to

work with the big retailers and CPGs and trucking companies and

now it's more companies wanting to headquarter and form their

home here in Northwest Arkansas.

Excellence, professionalism, innovation and

collegiality. These are the values the Sam M. Walton College

of Business explores in education, business, and the

lives of people we meet every day, I'm Matt Waller, Dean of

the Walton College and welcome to the Be Epic Podcast. I have

with me today, Barbara Marchini-Ellis, who's a Partner

at EY. And she has been there for 35 years. Most of her career

was in San Francisco and Silicon Valley. And now she's been in

Rogers since 2018. Thank you so much for joining me today,

Barbara.

Thank you for inviting me.

And thank you for your involvement with our board

and our accounting department. I appreciate that. So Barbara, you

have a lot of experience with EY obviously. And now you're a

partner. How long ago did you become partner?

I've been a partner for actually

close to 25 years. So the majority of my career with EY

has been in the role of partner.

And you have a lot of experience with global type

multinational clients. And you have lots of experience, I

think, probably in part to your being in Silicon Valley with the

technology industry and internet advertising, IT services,

software and others. And now you're in Northwest Arkansas,

dealing with retail and omnichannel retail. How was that

transition for you from a from a work type perspective?

Yeah, you know, it's been a really

interesting journey. I mean, you know, obviously, when we think

about Silicon Valley, we think about tech, and I often tell new

recruits that a lot of the companies who are our core

clients now didn't exist when I graduated from college, right,

you think of the Oracles and the Googles. And, and many of those

companies, they didn't exist back in the 80s, when, you know,

when I started in the profession, so actually, when I

started with EY, I did start in consumer products, I worked with

companies like Del Monte Foods, I worked with some wineries. And

then I had kind of some multidisciplinary, you know,

financial service conglomerates that were clients, so I'd always

kind of gotten experience working with bigger companies.

And then as the demographic of the Bay Area, and Silicon Valley

changed, I started working more in tech. So everything from

technology hardware, like a Hewlett Packard, and then you

know, higher end networking equipment and and, you know,

eventually into internet advertising with companies like

Google and Facebook, and so built a pretty, you know,

diverse background. And, and so the opportunity came up to lead

our work with Walmart, and with really the changing profile of

the company there and all their varied interests, sort of that

history that I had had of, you know, everything from consumer

products to tech was was was very, very interesting. So

that's what brought me to Rogers, four or five years ago.

You you've been in accounting, your career during

your career and accounting has changed accounting firms have

changed. What are some of the big changes you've seen over

your career?

Yeah, you know, you mentioned the

firms have changed when I started, there were eight, eight

major multinational firms.

I still want to say the big eight.

Yeah. So do I some days. You know, now

we're, we're at four multinational firms. I think

that clearly, when I started in the industry, we were not a

regulated industry. Currently, we are a regulated industry.

And, you know, I think, for everyone who's been through that

journey, that that does make some changes. I mean, our

general our, our oversight by a regulator certainly has, you

know, increased quality of the of the industry in the

profession and that's, that's always a good thing. You know, I

think clients have become more sophisticated. I mean, when you

think about when I started auditing, you had ERP systems,

but nothing like what you have today, right? And and, you know,

we I always tell people I could never be a staff accountant

today because, you know, we wrote everything out by hand

clients would hand us binders of information to evidence

transactions. And now, you know, we audit in a much, much

different way. And it's not only how we memorialize what we do

being, you know, electronic versus manual, but it's also

just the way that we approach the way we audit, we, you know,

we take data sets out of ERPs. And, and look at how data is

moving through systems, and then also look at, you know, evidence

of real information to get comfort, right, that what's

moving through these systems is, is based in reality and real

transactions our clients are entering into, but it's a much

different, a much different way of auditing than when I started.

And then the profession in general, you know, has also

moved from opining just on financial statements to also

opining on internal control. And so that's certainly brought

another big change to the profession since, you know,

since I started 30 plus years ago,

So, you know, there's all of these industries

are changing, you know, if you look at retail, for example,

retail is changing dramatically, especially with omni channel,

people are able to go in the store order in the store, get

pickup, get delivery, get delivery in home, delivery

through drones, just so many different, retails become very

complicated. For the the retailers, the number of

suppliers, they have to have has gone up dramatically, especially

for dot com type stuff. And all of that is really driven by

technology on the one hand and, and competition on the other.

But how do you see accounting and auditing changing over the

next decade or so?

You know, think there's going to be

a continuation of what of what we've currently seen, in terms

of, you know, moving more into a digital way of auditing and, and

looking more at reliance upon systems, trends in the data and

looking at full data sets. Versus a lot of times, you know,

traditional auditing was focused more on testing through

sampling, right. So you have millions and billions of dollars

of revenue, and you pick samples of hundreds of transactions that

are deemed to be statistically valid samples. And you draw

conclusions that way. Now, right, we take entirety of

datasets, and can look for the anomalies, and test to make sure

that we understand the process about how all of these

transactions make it into the system. So it's, it's a very

different, different way of doing that. And I think we're

really just at the forefront of that as a profession in terms of

deploying those types of procedures, and where, you know,

how it can fundamentally change our audits. And it's, you know,

it's an exciting thing for our people, because it gives them

the bigger picture more quickly, in terms of how, how companies

operate, and, and how we can, you know, draw conclusions,

really, with, hopefully higher levels of assurance and higher

levels of certainty than we're able to, you know, today, the

way our audits are designed.

You know, one thing that we started. So when I

became Dean eight years ago, I went around and talked to a lot

of our alumni. I would say 100 most successful alumni all over

the world, and asked them a couple of questions in different

ways. One was, what could we do as a college that would make you

more proud to be an alum? And what do I not know that if I

knew would help me manage better and lead better as Dean. I said

it in different ways, but those were the two things I was trying

to get at. And one thing wasn't necessarily number one, but it

was up there and it was frequent. And, you know, some of

these alumni went through our undergrad program somewhat

through our masters, one of our master's programs, some went

through both. But something that came up a lot was business

ethics. And they basically said, you know, we think you could do

more on business ethics. You know, with academic institutions

changing curriculum is very complicated. It's done through

the faculty. It's not top down, and it can't be. It just doesn't

work that way. But faculty are aware of what they're doing and

what their their specific areas are. And they naturally update

things. I met the Chief Ethics Officer of Walmart, she had been

Chief Ethics Officer for like 20 years at Walmart, Cindy

Moehring, you may know her I don't know. So when she retired,

she came on board, and began, she founded and started leading

the Business Integrity Leadership Initiative. But when

she did it, she found out that only about 15% of our students

were getting any substantive education in business ethics.

And so she, she really, she did a good job of working with

faculty to change the curriculum. And now 100% get it.

But one of the things that we've done is we have a lot of guests

come and speak to our college and meet with us. And we created

badges, achievement badges for learning certain things in

business ethics. So recently, we had the whistleblower for

Theranos, Erika Cheung came in, and she spoke to us but she also

like, our leadership team had lunch with her and we had

different, she had several meetings with us over the time

she was here. This doesn't have anything to do with accounting,

per se, but but then we also had the whistleblower for Enron come

in, as well. And, of course, we're off. I mean, these are big

time scandals you know that I, I mentioned, but there's lots of

them that occur. But I remember when I was talking to when we

were talking to the whistleblower for Enron, you

know, she said, she didn't think she was uncovering something

real big. It was more, she was thinking, there's a problem

here. And it needs to be addressed. And of course,

eventually, she was asked to talk to the CEO about it. And

she thought that's kind of strange. But, but in many cases,

these people that blow the whistle are accountants, not

always like Erika Cheung was a scientist. But many times they

don't know they've uncovered something so big. And they're

always surprised that how many people have gone along with

everything up to that point.th

Yeah. Yeah.

Do you have any advice for us as a college,

around things that you think are worth looking into, you know,

from a business integrity, ethics perspective, and

furthering?

You know, I think, to your point,

business ethics is sort of the foundation of everything, you

know, when when we look at working with companies and

accepting clients, one of the first things we do is, is

background checks, both on the company and on the key

executives of the company, and, and selecting clients that we

believe are ethical and trustworthy and forthright and

motivated to do the right thing. Are is sort of the foundation

of, you know, how, how we we built a practice and decide who,

you know, who we want to be associated with. But to your

point, you know, a lot of people as as these things come to

light, a lot of times it is a history, right? It's a history,

it's a culture, it's been there, and those types of things can

change on the margin very slightly to where it just

becomes, you know, feels normal. Right, and that, that becomes

challenging. And so, you know, I think a lot of it is making sure

that in every, in each and every one of us, whether you're on the

service provider side or the client side, right, you you just

have that strength and moral fortitude to keep your you know,

your moral compass where it where it needs to be and to ask

questions, and when something just doesn't, doesn't feel

right, or you don't understand it. I think, you know, a lot of

it from you know, and the public accounting profession isn't

isn't immune to those matters, either. Right? We've had our own

challenges and from time to time, their behaviors in the

organization, including EY that, you know, are other than what we

aspire to, and you have to deal with those and recognize those

and a lot of it becomes a big culture shift, right? There's,

there's consequences for individuals, but then, you know,

you have to kind of step back and say, Is this part of our

culture and what do we want and need our culture to be? So I

think a lot of it is is just each and every individual, like

I said, really having the strength and the conviction that

if it doesn't seem right, or it doesn't feel right, you know,

you need, you can't audit, you know, you shouldn't

automatically assume there's something malicious going on.

But you just have to raise your hand and ask questions. You

know.

So Barbara, you have elected to be in the

Yeah, it's a great question. Given

our, what we do in our profession, and having sort of

profession, your entire career. And you've been with EY for 35

annual cycles, that that, that that that come to a close each

year, there's a natural opportunity for reflection. And

in asking yourself, how have I grown this year? Is this a

career I want to continue to invest in? And I'll have to say

that, you know, in public accounting, and with Ernst and

Young specifically, I've felt that each year I've grown, I've

pushed myself, you know, beyond my comfort zone, and I'm doing

things that I would not have thought possible even a year or

two, prior, you know, and that continues, frankly, continues

today, you know, 35 years into my career. So it's, it's really

been the growth opportunities that come with the profession,

the ability to, and that comes to being able to see different

companies being able to talk to different different people at

different companies and in your younger years, right? It's,

you're you're working with, with control younger folks within

within your clients. But then as you progress, right, you're

years. So, two questions. What is it that's kept you in the

starting to work with more senior executives. So over the

profession this long? And two, what is it that's kept you with

years learning perspectives from from the CFOs, and CEOs, at at

the clients I've worked with has just been very, very valuable.

And I think what's also been rewarding is when you kind of

pivot from, hey, you're the auditor to, when you walk into

the office of an executive later in your career, and they're

really looking to you for counsel and advice, right, you

become a trusted adviser to them. That is hugely, hugely

firm so long?

rewarding. As I've entered into the the later stages of my

career, it's also been taking that out into the public. So

I've had the opportunity recently to to join some boards,

you know, board here in Northwest Arkansas that I'm on

is in, you know, the Endeavor board. So working with early

stage entrepreneurs. And again, that ability to kind of give

back to early stage entrepreneurs, based on the

experiences gained with a variety of companies has been

huge. So for me, it's really been just continuous growth. And

I see that, you know, continuing through the remaining years, of

my my career as well.

Well, you know, serving on Endeavors board,

helping entrepreneurs, you're a perfect fit for that, because of

your experience in Silicon Valley, I would think. Endeavor,

here in Northwest Arkansas, it's a global organization. But there

is an office here, for those listening that don't know about

it. They really look for what they call high impact

entrepreneurs, people who are dreaming big, they want to scale

faster. They've got good leaders in place. And they but endeavor

is, is doing really well here. And I think, you know, globally,

they've they've had a huge impact. They've had lots of

early stage founders that wound up with unicorns, inside and

outside of the US. So how long have you been working with Endeavor?

I've been on the board now three

years. And working with Canem and the rest of the board there.

It's been a great experience.

Do you think your your connections and just

experience in Silicon Valley, do you see things that we're

missing here a bit that we need in Northwest Arkansas? Or are

you able to kind of fill in the gaps for some of these early

stage companies?

You know, I think it's been

interesting for me to watch over the last three, four years, how

the the maturity profile of the companies that we work with in

endeavor has changed, you know, initially, you know, maybe the

business models weren't as broad the level of tractions that

companies had were not as extensive But over time, I think

because of much of the mentoring that a lot of the

entrepreneurial support groups to Northwest Arkansas have

attracted here a lot of the mentoring they've been able to

provide. It's been huge, right? Whether it's executives like

Marc Lore, who maybe would have never thought about Northwest

Arkansas, right, had it had it not been for Jet being acquired

by Walmart, or, you know, various other resources being

attracted to the middle of the country. There's greater

awareness of Northwest Arkansas, and all and more resources

coming here to provide that mentoring and support that I

think continue to help mature the entrepreneurial ecosystem. I

mean, I think the other the other angle to it is that the

capital needs to follow. You know, we we we have, you know,

some of our our venture capital folks that have visited here in

Northwest Arkansas and some of the conferences and so forth

over the last few years. And I think whether it's corporate VC

funds, contributing more or attracting other sources of

funding to the middle of the country, that's we're seeing

more of it than we did when I first came here in 2018. But I

think that's, that's sort of the next step. You know, I'd say the

progression I've seen is a lot of times as entrepreneurs coming

here to work with the big retailers and CPGs and trucking

companies, and now it's more companies wanting to headquarter

and form their home here in Northwest Arkansas. So I think,

you know, bringing in that support, mentoring and

financial, is really going to be the foundation of, of growing

the entrepreneurial community here.

Well, Barbara, I'm glad you're here in Northwest

Arkansas, and all you're doing and thank you for hiring our

students and for engaging with our college really appreciate

that. It was pleasure visiting with you and thank you so much.

Yep, thank you.

On behalf of the Sam M. Walton College of

Business, I want to thank everyone for spending time with

us for another engaging conversation. You can subscribe

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