Accounting Executive Compensation Has Reset. Most Firms Haven’t.
This is the third blog post in our four-part series on the structural forces reshaping executive hiring at accounting firms. In the previous post, we looked at how the CPA pipeline has collapsed faster than firms have adjusted. The compensation reset is the direct consequence.
The accounting executive talent pool is not just smaller than it was three years ago. It is significantly more expensive, and most firms haven’t updated their benchmarks to match.
Friedman Williams runs executive searches across both law firms and accounting firms, and we see the same compensation reset on both sides — but the accounting market has been more volatile, in part because PE-backed platforms (the consolidation dynamic we covered in the first post) now have access to capital structures that traditional partnerships do not. They are using it.
The base data: equity partner compensation at IPA Top 100 firms (excluding the Big Four) reached $839,687 in 2023, up from $620,936 in 2019 — a 35 percent increase in four years. Partner compensation rose 29.2 percent between 2020 and 2023; staff compensation rose 15.7 percent over the same period. Recent studies project finance and accounting salaries rising 2.1 percent on average, with public accounting roles up 3.7 percent and specialized roles up 5.8 percent. Eighty-seven percent of finance and accounting leaders now offer premium pay for candidates with specialized skills.
The legal market has moved in the same direction with different math. AmLaw 50 COO compensation now routinely exceeds $1.5 million, with firms increasingly benchmarking C-suite pay against equity and non-equity partner midpoints. Senior staff compensation surged more than 6 percent in 2025 alone, per Thomson Reuters. Compensation is the single largest expense category at law firms of every size, consuming roughly 30 to 40 percent of revenue before overhead and profit are considered — it is the financial foundation the entire business model rests on. The accounting comp curve looks different in absolute numbers but identical in shape. The implication for executive hiring is the same in either profession: a search that doesn’t acknowledge what the market is actually paying loses the candidate before the conversation starts.
The numbers translate into a specific operational reality. The candidate a firm wants to engage is now reading offers from PE-backed competitors who can structure compensation around equity rollover, retention bonuses, and value-creation incentives that a traditional partnership cannot easily match. The opening conversation is happening at numbers that would have closed a search five years ago.
Firms running searches against 2022 budgets are losing candidates before they ever meet them. In some cases, the candidate’s existing comp is already above the firm’s posted range. In others, the firm has the money but doesn’t know it has to lead with it. Either way, the result is the same: the search drifts, the firm settles for an available candidate instead of the right one, and twelve months later it is hiring again.
The pivot. Benchmark to 2026 market reality, not 2022 budgets. Searches that don’t acknowledge the math don’t get past the first call. Firms that want to hire well need to be honest with themselves about what the market is paying — and they need to be honest with their search partner about what they are actually willing to spend. The search where the budget is the last thing the firm wants to talk about is the search that quietly becomes the search where the candidate disengages without explanation.
The firms that win the executive hires they want in 2026 are the firms that lead with credible numbers, structure offers that reflect specialized value, and treat compensation as a strategic decision, not a budget exercise.
The three trends we’ve covered in this series — PE consolidation, the CPA pipeline collapse, and the compensation reset — share one consequence: the cost of a bad executive hire has gotten structurally higher. To close out the series, we’ve recorded a short video on the failure mode we see most consistently in these searches, and the one diligence question every firm needs to ask before extending an offer.
