In the shadow of the ‘Big Four’ audit and consulting firms, the French group is pursuing its international expansion without forgoing its participative culture.
Pierre-Henri de Menthon
Mazars expands to protect its independence
At the end of April, Mazars secured its 54th merger deal in ten years with Roever Broenner Susat (RBS), a German firm that employs 750 people in ten locations across Germany. Philippe Castagnac, CEO of the small, French-owned auditing and consulting multinational, can reel off the numbers by heart: annual revenues in Germany will be €110 million, or 10% of overall revenues; in 20 years, the number of partners has risen from 100 to almost 800, only 165 of whom are French; the group operates in 73 countries, and aims to increase that number to 100 very soon.
The takeover trend began in 1983 when Robert Mazars retired. The founder opted to sell his already booming business to his partners for a symbolic sum, while other well-known independent firms, such as Salustro and Constantin, would go on to merge with the likes of KPMG or Deloitte. The disciples of the Normandy-born accountant, including Philippe Castagnac and his predecessor Patrick de Cambourg, then decided to swallow up their rival, Guérard Viala, and to go out and conquer the world. Their strategy was almost mandatory because, to keep hold of their big CAC 40 clients, they had to be able to follow them all over: to Germany, the United States, Zimbabwe and Malaysia.
To make their strategy work, Mazars had to get their organisation right. “We operate on a profit-sharing basis”, explains Castagnac. In other words, the shares owned by the partners of the parent company, a cooperative governed by Belgian law, have a fixed value while the capital is variable. This means that Mazars can absorb an almost unlimited number of newcomers through mergers and acquisitions. But once all the costs of doing business have been met, all the remaining profits are shared. There is no capital and a lot of revenue, even if partners are encouraged to put at least part of their profit share into a long-term savings plan: Mazars not only observes the fundamental rules of partnership, but it takes them even further than British and American giants like Deloitte, KPMG, EY and PwC.
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