Do we still have ‘the Big Four’ in the UAE?

The UAE’s focus on becoming a global innovation hub has increased demand for advisory services in technology, cybersecurity, and digital transformation, areas where smaller, agile firms can compete effectively

The UAE’s introduction of corporate taxation in 2023 and the ongoing refinement of VAT regulations have created opportunities for firms specialising in tax advisory and compliance services. Image: Shutterstock

You could be forgiven for not getting that excited about accountancy firms, or, for that matter, accountancy itself. As a rather late convert myself (I qualified as a CGMA 3 weeks before my 60th birthday) and as a university professor of business, I am allowed to indulge my research interests, some of which involve the increasing representation of women (often qualified accountants) on audit committees. However, in wading my way through hundreds of annual reports, I have found myself drawn to checking out which accountancy firm has signed off the accounts. Are the Big Four really dominant in the UAE?

The term “The Big Four” refers to the four largest and most influential professional services firms in the world: Deloitte, PricewaterhouseCoopers (PwC), Ernst & Young (EY), and KPMG. These companies dominate the global market for audit, tax, consulting, and advisory services, collectively generating hundreds of billions of dollars in annual revenue. Their designation as “The Big Four” underscores their market dominance, historical significance, and global reach in the accountancy and professional services sectors.

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The emergence of “The Big Four” resulted from decades of mergers and acquisitions in the professional services industry. Historically, the industry was referred to as “The Big Eight,” a group of accounting firms that dominated the global market until the late 20th century. Over time, mergers reduced the number to “The Big Six” and then “The Big Five.” The collapse of Arthur Andersen in the wake of the Enron scandal in 2002 reduced the group to the current “Big Four.”

Who are the Big Four?

1. Deloitte: Founded in 1845, Deloitte is the largest of the Big Four by revenue and workforce. It provides audit, tax, consulting, and advisory services across a wide range of industries. Deloitte’s strong focus on technology consulting has driven significant growth in recent years.

2. PwC (PricewaterhouseCoopers): Established in 1998 through a merger between Pricewaterhouse and Coopers & Lybrand, PwC is renowned for its audit and assurance services. It also has a strong presence in consulting, particularly in strategy and risk management.

3. Ernst & Young (EY): Known for its auditing and consulting services, EY has a strong emphasis on innovation, particularly in sustainability and digital transformation. The firm traces its roots back to the early 20th century.

4. KPMG: Formed in 1987 through the merger of Klynveld Main Goerdeler (KMG) and Peat Marwick International, KPMG is known for its expertise in audit, tax, and advisory services. It has a strong global presence, particularly in Europe.

Interestingly, global accounting firms are not single, unified entities but rather networks of independent partnerships that collaborate under a shared brand and global umbrella. This decentralised structure allows each member firm to operate independently while benefiting from the resources, reputation, and expertise of the global network. There are global umbrella organisations that provide coordination between all the different firms operating under the brand name.

The emergence of “The Big Four” resulted from decades of mergers and acquisitions in the professional services industry. Image: Shutterstock

Deloitte Touche Tohmatsu Limited (DTTL) is the coordinating body for Deloitte; PricewaterhouseCoopers International Limited oversees PwC; Ernst & Young Global Limited coordinates EY and KPMG International Cooperative governs KPMG. These global entities are typically organised as private companies or cooperatives, but they do not directly provide client services. Instead, they set global standards, share best practices, and manage the brand.

This compares to other global consultancy firms such as McKinsey; McKinsey operates as a unified, global partnership where all partners collectively own the firm. Partners share profits across the global organisation, decision-making is centralised at the firm-wide level, and key policies, standards, and strategies are set globally, with local offices, which are not separate legal entities, following the same framework. Revenue generated by McKinsey globally flows into a single pool, which is then distributed among the partners based on performance and contributions.

While the Big Four dominate many markets, their influence is not absolute, and they face challenges from regulatory changes and emerging competitors in specific regions. One of those is the Gulf, and especially the UAE.

In looking at ‘Who audits the UAE’, I discovered that we don’t have a Big Four, we have a ‘Big Three, and a middle-sized two. Grant Thornton, whose global revenue in 2023 was $7 billion, or only one-fifth of the smallest of the Big Four (KPMG: $35 billion) joins EY and Deloitte in auditing about thirty UAE listed companies, with PWC and KPMG on about 20. (Full disclosure: Grant Thornton funded my research into audit committees, but they never knew I would be looking at who signed the accounts as well).

Why this different configuration in the UAE? As one of the GCC’s most dynamic economies, with business-friendly regulations, extensive free zones, and a focus on digital transformation, it is a key battleground for professional services firms. While the Big Four dominate large-scale projects, particularly in sectors like financial services, energy, and construction, mid-tier businesses often prefer smaller firms that offer tailored solutions at competitive prices. Several other international networks and regional players have steadily carved niches by addressing specific local needs, offering competitive pricing, and leveraging in-depth market knowledge.

Grant Thornton is not alone in actively competing with the Big Four in the UAE: BDO International and RSM International are two other examples of companies that are providing strong local competition. The UAE’s introduction of corporate taxation in 2023 and the ongoing refinement of VAT regulations have created opportunities for firms specialising in tax advisory and compliance services, and many UAE businesses prioritise firms with a strong understanding of Sharia-compliant financial systems and regional market dynamics. Local and regional competitors often excel in this area, as they often do in digital transformation.

The UAE’s focus on becoming a global innovation hub has increased demand for advisory services in technology, cybersecurity, and digital transformation, areas where smaller, agile firms can compete effectively.