‘I don’t see there being a recession in the next 12, 24 or 36 months’

Deloitte Ireland chief executive Harry Goddard steps out of the lift and glides into the foyer on the sixth floor of its main office on Earlsfort Terrace in Dublin 2, opposite the National Concert Hall, greeting me with a warm handshake. He’s popped upstairs from a glass-panelled ground floor meeting room that he uses as an office in this brave new world of hybrid working.

“I used to have an office up here, but I book a room when I’m in the office now, downstairs beside our coffee dock,” he says. “There’s a series of glass-walled meeting rooms. If anybody wants to use an office, they have to book it on the day they’re coming into work. I do the same. The only thing specific to it is that it has a stand-up desk for me.”

His executive assistant, meanwhile, sits on the first floor. “She supports another partner as well and he sits open plan beside her. It’s just practical.”

At present, Deloitte has some or all of five buildings in Dublin. Goddard says about one-third of its pre-Covid office space is either mothballed or sublet. And it has agreed a deal with Irish Life to let nearby 1 Adelaide Road as a new headquarter campus, once it has been redeveloped.

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Deloitte has been searching for a new HQ since before the pandemic, recognising the benefits of having all its staff under one roof rather than split across multiple sites. Its plan changed dramatically due to the Covid-19 lockdowns.

[ Deloitte chooses Irish Life building on Adelaide Road for new Dublin HQ ]

The move to a hybrid working model resulted in Deloitte scaling back its office plans from seeking 275,000sq ft pre-pandemic to a situation where it has secured 160,000sq ft at the 10-storey building that will be developed on Adelaide Road.

Goddard says about 65 per cent of its workers come to the office at present, for at least one day a week. The nature of its work meant there were always lots of staff in the field with clients, even before Covid. “Monday is typically pretty quiet, Friday is the quietest for sure,” he says, adding that about 10 per cent of its workforce comes to one of its offices on a Monday or Friday nowadays.

Of course, Goddard himself attends the office every day. “Part of that is about who I am. I’m social and I like to meet people. Mondays and Wednesdays, I work from home generally to about lunchtime. I try to avoid the commute. ”

People’s growth levels are definitely ameliorating, that’s definitely happening, but we’re still growing. It’s important to keep that context in mind. We’re not shrinking

As one of the country’s biggest accounting and consulting firms, Deloitte is well plugged into the business community and should be able to gauge activity levels in the economy.

Headline GDP numbers suggest the Irish economy is going gangbusters, but recent months have seen thousands of job losses in the tech sector – Deloitte’s rival Accenture recently announced that 400 roles will go here – and inflation soared last year, putting the squeeze on consumers. The war in Ukraine continues to overshadow the European economy, and recent bank failures have highlighted vulnerabilities in the global financial system.

Goddard said there have been no job cuts at Deloitte, and he is optimistic about the future of the economy in spite of the many headwinds facing us. “People’s growth levels are definitely ameliorating, that’s definitely happening, but we’re still growing. It’s important to keep that context in mind. We’re not shrinking,” he says.

“I would far rather see someone like Accenture, like any large corporate, take out 2.5 per cent [of its headcount] early than 10 per cent late. When I talk to clients, most organisations continue to see a positive outlook in their pipeline. Trade is good, there is still private equity around, there are still deals to be done, [but] valuations have changed.

“So if we can stay out of recession and not talk ourselves into something that we’re not actually in, I can see us making our way through this by the end of this year.”

So, no recession?

“I don’t think so. The fundamentals of the economy are so strong. The biggest risk to us [as a country] is finding a way to spend the money that we have. You have got to be very clear what you’re going to invest in. That’s the biggest risk to our economy. I don’t see there being a recession in the next 12, 24 or 36 months. I think the risk is more medium term and how we position ourselves for the future.”

[ Deloitte boss rebuts EY’s case for splitting up ]

Deloitte has about 3,000 people on the island, 119 partners and generated revenues of €429 million last year. The firm also has 1,500 employees at a delivery centre in Northern Ireland that focuses on consulting work and is owned by the UK arm of the firm.

Goddard is predicting “double-digit” growth in the current financial year to the end of June, which would take Deloitte’s revenues on the island to close to €500 million.

He says Deloitte has not laid off any staff or paused hiring plans. The leak of staff to the tech sector has “totally dried up”, he adds, while pay inflation “has also settled”.

Just around the corner from where we’re sitting, Deloitte’s Big Four rival EY has been mulling a global split of its audit and consulting business. The process has been paused, according to reports, due to internal wrangling.

I would far rather see someone like Accenture, like any large corporate, take out 2.5 per cent [of its headcount] early than 10 per cent late

Goddard himself is a “product” of a past split, when KPMG spun off its consulting unit in 2001 in an initial public offering, with the business changing its name to BearingPoint to emphasise its independence. He was a director in KPMG at the time of the split, later rising to become managing director of BearingPoint.

He cites BearingPoint as a cautionary tale against splitting audit from consulting. “BearingPoint ultimately filed for Chapter 11 [bankruptcy protection]. The partners who sold the business didn’t make any money. Cap Gemini took on Ernst & Young’s consulting business at the time and IBM took over PwC’s consulting business at the time, and I don’t think there are many people going around thinking that they created fortunes as a result of those particular transactions, except perhaps, in EY’s case, for retired partners who got a 10 per cent premium to their pensions from the transaction.”

[ Deloitte Ireland revenues surge to €429m but client sentiment ‘more cautious’ ]

The process of splitting, Goddard says, was “hugely distracting”, with a “huge exercise” around integration.

“I left because, every February, we had a managing director’s meeting in Orlando, and I remember sitting in one of them and the CEO at the time was announcing how he was going to get BearingPoint back on to a stable financial footing. The irony was that he was going to take the business private and establish it as three separate private partnerships.

“I was sitting listening to this in my mid-30s, thinking: ‘I’m too young and too insignificant to be part of this any longer. These people have no idea what they’re doing, and I’m going to get crushed in all of this.’ It was such a distraction to serving our clients.”

He left, and joined Deloitte in 2007.

Whatever comes of EY’s proposed split, Goddard says Deloitte has no intention of splitting its own firm. “Each of us has our own strategy,” he says. “Globally, we’re the largest professional services firm in the world, and the fastest growing in the past number of years. I continue to see a real opportunity for us in having those various elements in our business. Each of them brings a competence and capability that is complementary to the other.

“There are conflicts from time to time, but we’re not so big, and I don’t think anyone will allow us to get so big that they become an inhibitor to the growth of our business, ultimately.”

I was sitting listening to this in my mid-30s, thinking: ‘These people have no idea what they’re doing, and I’m going to get crushed in all of this’

Goddard’s rise into the senior ranks of corporate Ireland was not a traditional one. He grew up in a village just outside Newmarket-on-Fergus in Co Clare, one of four boys. “It used to be infamous for being the worst bend in the road from Ennis to Shannon,” he says.

He went to St Flannan’s College in Ennis nine miles away, but “did not enjoy secondary school at all”. It was a hurling-mad school but Goddard “lacked the hand-to-eye co-ordination” for the sport. “I didn’t enjoy my time there at all.”

He recalls “horrifying my [accountant] dad” by telling him one day that he’d probably get a job on a nearby farm, where he had been working during summers.

Enter Bishop Willie Walsh, who was a maths teacher in the school at the time and who spotted Goddard’s potential for the subject. “He recognised that I loved the subject of maths and he encouraged me.”

This helped to propel him on a path to an applied maths degree in the University of Limerick, which he “really enjoyed”. Goddard hankered to be an actuary, but ended up on nine months of work experience with insurer Church & General.

If we can stay out of recession and not talk ourselves into something that we’re not actually in, I can see us making our way through this by the end of this year

He admits to not paying attention at the interview, and rather than filling his dream role as an actuary he ended up in the IT department, providing support to its staff whenever there was a problem with a PC or a printer.

However, his boss there – a “fantastic mentor” – took him under his wing and they both began writing computer code, something of a tortuous process back then compared with now. It set him on a path to a career in consulting, culminating ultimately in him being appointed as Deloitte Ireland’s CEO in June 2019.

On June 1st, Goddard will begin his second term as CEO, effectively starting the clock on his final four years with Deloitte, given the long-standing tradition of Big Four firm leaders stepping away once their time at the top is up. “I’m really looking forward to this term, I think it’s going to be great fun,” he says.

“I will leave the Irish business for sure but I’ve no idea what I’ll do next. I don’t see myself as being on the non-executive [director] circuit. I was torturing myself about it [what to do next], but I’ve decided to put it out of my mind and focus on this job. I would say that I’ve got two years where I really need to get things done ... in my fourth year, I’ll definitely get more cycling in.”

CV

Name: Harry Goddard

Job: chief executive, Deloitte Ireland

Age: 51

Lives: Terenure, Co Dublin

Family: married to Mags with three children

Hobbies: loves sport and keeping fit

Something you might expect: He’s a keen cyclist. “Chief executives are either into golf or cycling these days.”

Something that might surprise: He used Covid lockdowns to learn how to play the piano.