Ireland may indulge soundbite-friendly economists and business advisers but we don’t do celebrity accountants. If we did, incoming PricewaterhouseCoopers senior partner – credited as “grand architect” of the double Irish and scion of one of the State’s pre-eminent political dynasties – would likely be top of the queue.
But it could have been otherwise.
Feargal O'Rourke (50) was born into a staunch Fianna Fáil family in Athlone, Co Westmeath. His mother, Mary, served three terms as a government minister; his uncle, Brian, held a number of cabinet positions, most notably as tánaiste to Charles Haughey's taoiseach; and his cousins Brian and Conor served in the last government.
Unsurprisingly, then, politics was often on his mind growing up. He chaired the college branch of Fianna Fáil while at UCD and joined the national executive when he left. But politics was not his only influence.
His father, Enda, who died in 2001, left school at 16 and worked in a cash and carry before becoming the first Catholic sales rep for Jacob’s Biscuits. He was subsequently a managing director of a small oil company.
“He placed great store in professional qualifications,” says O’Rourke, remembering that he was told: “Qualify as a chartered accountant and the world is your oyster.”
So he did, training with PwC (or PW as it was known then) after a master’s at UCD. For a while it seemed as if he would make some inroads into his accountancy career in the capital, before returning home.
“I had great intentions of going back to Athlone,” he says.
Politics, at the time, was still on the agenda. So what went wrong?
“Or what went right!” he says, laughing.
Political direction
It came to a head in his mid-20s when he was asked by some Fianna Fáil activists in Dublin to consider going forward for nomination in the following general election.
“I almost certainly wouldn’t have been elected and would just have been a ‘sweeper’ candidate if I had got on the ticket, but it would have put my career on to a political direction,” he says. He was fortunate to have a good mentor at PwC at the time, who helped him make the decision.
“He said to me: ‘There’s a fair chance you can end up running the country, or end up running here, but you can’t do both.’
O’Rourke opted to stick with accounting, and quickly raced up the career ladder. In 1996 he became one of PwC’s youngest partners, becoming a part-owner of the Irish firm at the age of 31.
“I’ve no regrets,” he says firmly, adding that he hasn’t wavered in this view.
When his brother Aengus was running in the Longford-Westmeath byelection last year, he went down for the convention to support him. “I was standing at the back, and my mum said is there not a part of me that would like to be up there? ‘No’ was my answer!”
Nonetheless, with politics in his blood, he’s not immune to the call of the ballot box. Having spent almost three decades with PwC, he recalled the advice of his former mentor when the position of senior partner with the firm opened up.
“Every time I’ve done something, I’ve said, ‘What is the best I could be – what could I do higher or better?’” he says, quoting Napoleon’s maxim “There is a field marshal’s baton in every soldier’s knapsack.”
So with Ronan Murphy stepping down from his second term as senior partner of PwC this July, O'Rourke threw his hat into the ring.
It was the first time in more than 19 years the firm had a contested election – Murphy and his predecessor Donal O’Connor had been appointed uncontested. This time, three partners went for the role.
The election is run on a one-man, one- vote basis, and each candidate had to produce a manifesto as well as canvass each of the partners. His political background stood him in good stead for the process.
“My mum and I are both early risers, so most mornings I’d be coming into the office and the phone would go, and it would be my mum giving me some human- nature advice and asking how is it going,” he says. “One thing politics did teach me is that if someone looked me in the eye and said, ‘You’ll make a good senior partner,’ they probably wouldn’t vote for me.”
In the end, O’Rourke won with a decisive vote. He says the result was not acrimonious.
“I’ve had absolutely nothing but huge support from the other two,” he adds.
Ambition
O’Rourke will assume the role of senior partner on July 1st and says his ambition is to maintain PwC’s “pre-eminent space” and bring the firm into new areas.
The firm was hit by the force of the recession, with fee income growing by just 0.7 per cent between 2010 and 2013, and staff were hit with pay cuts in 2009. From his office on Dublin’s Spencer Dock, where the firm moved in 2007, O’Rourke had a daily reminder of the state of the economy, with his window looking out on to the skeletal outline of what was once to be the headquarters of Anglo Irish Bank headquarters.
But the firm, like the economy – and the neighbouring site (now earmarked for the Central Bank’s new headquarters) – is now in growth mode. Last year was a stellar year, with revenue up almost 10 per cent to €329 million, and the firm has just appointed eight new partners – the biggest number since 2007. One area it did not cut during the downturn was recruiting.
“This year we’ll recruit 350 people,” he says, adding that you have to “flip your mindset”. “If you stop recruiting and stop promoting for a couple of years you’ll bear that error forever.”
O’Rourke puts the firm’s performance of late down to higher fees and a greater volume of business. Now his focus is on broadening the firm’s business offering.
“As we evolve, the purpose of PwC is to build trust and to solve important problems. It’s the two pillars of the business.”
Consulting has been a “significant growth area”, he says, but adds that another growth area is likely to be in the broader application of assurance.
“We’re looking at other areas where companies are looking to get assurance on something,” he says, citing the example of providing assurance as to the traceability of food.
“We’re saying: ‘Where do you need to give your stakeholders comfort that you’re doing things the way you’re supposed to be doing.’”
Contradiction
But is there a contradiction in an accounting firm offering assurance when the profession failed to communicate the timebombs ticking on the balance sheets of Ireland’s banks before the bust? PwC, after all, was auditor to Bank of Ireland in the years running up to the near-collapse of the sector.
O’Rourke doesn’t think so, arguing that, given the rules as they are, and the “size and scale” of the financial crash, accountants could not have produced accounts indicating the scale of what was coming.
“The big thing is that there is an expectation gap between what the law provides and what the man in the street thinks it does,” he says, adding that he foresees auditing evolving to where it provides more real-time information.
Already the audit function is in flux. “There is no doubt that audit fees came under pressure during the last four or five years,” he says. While 10-15 years ago, fees from auditing would have accounted for more than 50 per cent of the firm’s revenue, he says, “it’s now probably 40 per cent of our business and, in relative terms, is falling”.
Changes afoot may accelerate that decline, although O’Rourke expects a new audit regime due to be introduced in Ireland at the behest of Europe may increase audit fees.
That’s not to say he’s a fan of the current approach the Irish authorities appear to be taking. Under the new EU rules aimed at improving audit quality, countries will have the option of requiring companies either to change their auditor every 10 years, or adopt a “10+10” approach, which will allow them to tender after 10 years, but keep their existing auditor for another 10, if they so wish.
The Department of Enterprise is working through implementation of the rules in Ireland and O’Rourke fears it may take an uncompetitive approach. Luxembourg, Germany and the UK appear to be opting for the latter approach, which would allow a company retain the same auditor for up to 20 years, but O’Rourke fears Ireland will go for the former.
“I’m not sure if it’s the smartest move from an FDI perspective,” he says, noting that it will affect about 1,000 companies in Ireland, many of which are international investment funds domiciled here.
“Nobody has yet to convince me why it would be a smart move to deviate from our international competitors,” he says.
Legacy
O’Rourke is well versed in briefing government, and has advised many ministers, including his cousin, the late minister for finance Brian Lenihan. While reluctant to comment on a posthumous role for Mr Lenihan at the ongoing banking inquiry, O’Rourke is sure of his cousin’s legacy.
“He was a fantastic guy. History will treat him very well.”
While he has advised numerous ministers, he rejects any suggestions that the relationship between politicians and their advisers can be too cosy.
“It’s always about what’s best for Ireland in the long term,” he says, adding that this link did not end when Fianna Fáil lost their place in government. Indeed his dream of visiting the White House was made possible because of an invitation from Taoiseach Enda Kenny.
But does he have advice now with electioneering ramping up ahead of next year’s general election?
“We need to be careful – we’re still not in giveaway territory yet,” he says. Although the tax cuts in the last budget were as much about psychology as mathematics, he says, and it was “time to give something back”.
He expects to see more of it later this year with tax cuts given in an “appropriately prudent way”.
O’Rourke’s day-to-day job is trying to get companies to set-up operations in Ireland. He’s on the board of the American Chamber of Commerce and his beat is the US, which he visits five or so times a year.
Global domination
Increasingly, he’s finding himself pitching to companies that haven’t been in business long.
“There was a time, 10-15 years ago, when a company looked to expand after being in existence for five-six years. Now they’re up and running very quickly and want global domination in 18 months,” he says.
“The trick is to spot these on the way up, pitch to them, and tell them, if they’re expanding, they need to be in Europe.”
US FDI into Ireland has been particularly strong of late, and O’Rourke doesn’t see any sign of it slowing down.
“There is no sign of that pipeline abating,” he says, noting that Ireland’s track record in the sphere means it’s now a case of: “Why not Ireland?” as opposed to “Why Ireland?”.
He also looks to China: “I still think China will be a major market for us; China is the great prize,” he says.
O’Rourke was last year credited by Bloomberg as the “grand architect” of the “double Irish”, a tax loophole that allowed multinationals like Google reduce the amount of tax they paid.
“It’s flattering but untrue,” he says, joking that the double Irish was in place “long before I was in short trousers”.
He says what multinationals really desire is certainty. He’s also quick to dispel the notion that tax consultants like him spend their days dreaming up ways of slashing company’s tax bills.
“An awful lot of tax work is about complying with the law. We have volumes of tax law; there’s no way companies will understand all of that,” he says.
Of the wider tax environment, O’Rourke thinks the OECD base-erosion and profit-shifting (BEPS) process is “very good” for Ireland.
“If BEPS sees itself to a successful conclusion, it will be good for Ireland.” The process is effectively about “rewriting the rule book”, he says.
“You can’t underestimate what’s being done . . . they’re trying to shape a regime that has been in place for 100 years, and trying to marry it with a business model which didn’t exist at that time.” The result will reshape the global tax environment “for the rest of my life”, he says.
But for all his evident love of his job – he professes to never not want to come to work – the political side has not disappeared entirely. The political gene skipped him, but it may have found a home in his 12-year-old daughter, Jennifer, who is very close with Granny Mary. She could be another politician in the making.
"She's very outgoing . . . although I might warn her off it!" he says, laughing. CV Name: Feargal O'Rourke Age: 50 Home: Sandycove, Dublin
Family: Married to Maeve with two children, Jennifer (12) and Sam (10)
Something you might expect: He’s a keen follower of US politics, and got to fulfil a dream when he visited the White House for St Patrick’s Day in 2014. Something that might surprise: Growing up, his ambition was not to be a tax consultant but rather a sports journalist. He is sports mad and has tickets for October’s Rugby World Cup final. He is also a nonexecutive member of the IRFU’s finance committee.
