John Hagen doesn’t like the word “retirement”. When he steps down from the top slot at Deloitte on August 6, it will be to “redesign” his life, not recline in rocking chair.
Hagen is not old. Though prematurely grey he is, at 58, still the dapper man he was when he took over the chairmanship of the local arm of the global accountancy practice in 1995. His health is excellent, his conversation is as non-PC as ever, and he still enjoys good wine.
This is man who is quitting at the right time and for the right reasons.
“I have been chairman for 10 years and that seems to be long enough. My intention is to do what I want to do in the way I feel I should,” he said. “The chance to make decision is pretty liberating.”
Hagen has earned rest. Since being appointed partner in 1981 he has, by his own estimation, worked “bloody hard”, contributing greatly to Deloitte’s unrivalled standing in New Zealand accountancy. He wants, without regret, to put the world of targets, timesheets and billable hours behind him.
Who can blame him? Hagen has been more than the public face of Deloitte for much of the past generation; he has been the conscience of the accounting profession through the Institute of Chartered Accountants and the Accounting Standards Review Board. No accountancy chief executive has appeared more times with the minister of finance on Budget night.
“I’ve had pretty good run. The past 20 years have been kind to professional people in New Zealand in the work available and the incomes we have been able to earn,” he concedes.
That “good run” reflects his chirpy personality, which won Deloitte considerable business during his time, and his willingness to deal to those who view accountancy practices as fair game for civil suits. Hagen not only protected the firm from being targeted by professional litigants but his knowledge of law and commerce also made him formidable expert witness in civil court cases. Other partners might shy away from being grilled in the High Court witness box; Hagen, however, loves it and will probably continue to serve as an expert witness in his new career.
He holds several outside directorships and expects to be offered more, though he has no particular companies or industry in mind. His mind is, for now, focused on the process of leaving Deloitte.
“I want to be doing the things I enjoy. I don’t want to be constrained by the rigidity of being partner in big firm.”
Not that Hagen has day of regret about his accountancy career. His first dabble with accountancy – called accounting when he was young – came in his varsity days when he worked for Barr Burgess & Stewart, the national practice that became Coopers & Lybrand.
He was ‘straight A’ student, earning master of commerce degree with first-class honours in accounting from the University of Auckland.
Hagen was bright and, for time, set his mind on becoming an academic.
“I went to Canada with the intention of doing PhD and enrolled in the PhD programme at the University of British Columbia. After couple of months I pulled out an enrolled to do an MBA.”
Hagen majored in finance and put his qualifications to good use back in New Zealand. After successful commercial career he joined accounting firm Hutchison Hull & Co in 1980 (the predecessor to Deloitte) and became partner the following year.
But his interests always extended well beyond the job.
“I have quite few interests outside work. I have been very keen on golf, keen on wine and keen on travel. My personal self-esteem is not tied to the job.”
At work, Hagen’s mix of business acumen and charm made him hit with clients and staff and he was able to lead the firm into business areas once reserved for lawyers.
“Accountants are lucky. Being numerate is huge advantage and lot of lawyers are not numerate. Many of my partners cannot do what people regard as traditional accounting services. Accountancy training makes it much easier to become business savvy.”
Hagen, who was president of the Institute of Chartered Accountants in 1994, regrets that the profession has not been able to attract more women. “We tried very hard to get more women through the partnership but most think it is not worth the sacrifice.”
Hagen attributes the growth and reach of chartered accountancy to the competitive nature of the business and the quality of accountants’ training – so good, in fact, that New Zealand-trained accountants are sought-after worldwide.
“The accountancy professional has done very well for someone who is not protected by legislation. We have number of what we would refer to as non-member partners. They are not qualified accountants but they are still partners of the firm. They bring diversity and we see that choice as part of the service we offer our clients.”
Hagen’s obvious strength, apart from his business skills and knowledge, is his mastery of politics. His is not in the Labour camp – he is member (though not an especially strident one) of the New Zealand Business Roundtable – yet he maintains excellent relations with Finance Minister Michael Cullen and has considerable respect for him. He is able, through his ability to talk to all-comers in politics, to highlight the challenges facing New Zealand.
One of the most serious, he says, is the 30 percent gap in living standards between Australia and New Zealand – gap that will continue to draw young people away from New Zealand.
Hagen remains loyal New Zealander and apart from international travel and golf, which he and his wife Barbara enjoy, it is hard to imagine that he will join the growing group of well-heeled but disgruntled Kiwis who migrate to London.
Indeed, much of his work for the accountancy profession in the past 25 years has been to extend globalisation to New Zealand. This was primarily through his chairmanship of the Accounting Standards Review Board through which he steered New Zealand toward adopting international accounting standards.
This work encouraged the University of Auckland to give him the Distinguished Alumni Award in 2003 – fitting tribute for one of the more tedious tasks of modern accountancy.
For New Zealand companies, however, the new standards will prove as expensive to implement as they will be profitable for the accountants who do the work. But Hagen’s handling of the issue has been businesslike and sound.
He is at peace with life after spectacular but stressful accountancy career and ready to develop new career. It promises all the excitement of his time at Deloitte.
“I do not use the word ‘retire’,” is all he will say.
Hagen describes himself on the Deloitte website as “principled, straight-talking, financially literate, decisive and thoughtful, politically astute and good under pressure”. Colleagues and adversaries alike agree.
These are skills New Zealand management needs dearly. Hagen will no doubt share his skills at governance level in future and there are few boards in New Zealand that could do with them.
Hagen in Brief
Born: July 31, 1946, at Auckland
Educated: University of Auckland, University of British Columbia
Career: 1980: Joined accounting firm Hutchison Hull & Co (the practice that became Deloitte)
1981: Became partner
1993: Inaugural chairman, Accounting Standards Review Board
1994: President, Institute of Chartered Accountants of New Zealand
1995: Appointed Deloitte chairman
Outside directorships:
Chairman, New Zealand Debt Management Office Advisory Board
Board member, Datacom Group, Hughes & Cossar, Auckland Regional Chamber of Commerce & Industry, Trustees Executors.
