A responsibility toward future generations: stewardship in action
Cairo - Urbanity by Mazars - artwork by Dominique Emard

A responsibility toward future generations: stewardship in action

It all started in 1942. After five years of working for the Egyptian Ministry of Justice, Mr. Mostafa Shawki decided to start his own business in the field of accounting, audit and tax advisory services. At the time, Egypt only had four registered accountants and auditors, and no tax law. With the overwhelming majority of audit and accounting professionals in the country being foreigners, the newly-born Mostafa Shawki & Co. became one of the very first national accounting and audit firms.

After only six years of operation in Cairo, Mostafa Shawki & Co. opened a second office, in Alexandria. In 1953, business had grown enough to lead the firm to move to a larger location.  The very same year, the firm also set up shop in Tripoli and Benghazi, in neighbouring Libya, before becoming the first accounting and audit organisation in pre-independence Kuwait in 1959.  

The sixties were a slightly more complicated decade. Under the rule of Nasser, Egypt embraced socialism and entire swathes of the economy were nationalised. Accounting firms were no exception, as the government planned to create a single state-owned and controlled accounting body.  Obviously, this significantly impacted the firm’s local business and revenues. Mostafa Shawki did limited work for the authorities in then socialist Egypt, namely the Central Audit Authority, which entrusted the firm with several audit operations. He thought, however, that the best way to turn what seemed like bad news into a growth opportunity was to leave and transfer the bulk of the business to Libya, Saudi Arabia and Kuwait. In doing so, Mostafa Shawki established himself as a true pioneer in the Arab world. “When my father had to leave”, explains Ahmed Shawki, son of the firm’s founder and current Managing Partner of Mazars in Egypt, “he built the first auditing standards in Kuwait, Saudi Arabia and Libya. In Libya, he was actually the first registered auditor. He also played an instrumental role in creating accounting bodies in the Middle East.” 

It wasn’t until the seventies, and Anwar el-Sadat’s decision to reopen the economy, that Mostafa Shawki came back to Cairo. “For the firm”, says Ahmed Shawki, “this was a rebirth. Business quickly started to boom. We had to hire more people and rent additional space. In 1989, we moved into our current premises, and over the course of 15 years, we went from 50 to 300 people.” 

In the meantime, Mostafa Shawki & Co. had become part of the Arthur Andersen network, in 1981, before successfully merging with another Egyptian firm – Ragheb, Al-Gamal, Aboud & Co. – in 1988. Later on, the organisation joined the Deloitte & Touche network and finally, in 2006, decided to join Mazars’ international integrated partnership.  

Mostafa Shawki passed away in 1997, on a pilgrimage trip, but the firm he founded in 1942 continued to strive and grow. Now a part of Mazars, over the years it has become one of Egypt’s leading audit, accounting and tax practices.  

I strongly believe the number one reason why the firm has been alive and growing for 75 years is the fact we have always wanted to maintain excellence in the quality of our work.

Excellence as the key ingredient of longevity 

“I strongly believe the number one reason why the firm has been alive and growing for 75 years”, Ahmed Shawki says, “is the fact we have always wanted to maintain excellence in the quality of our work.” Which is why Mazars Mostafa Shawki has, from the beginning, made training a top priority. “We are very strict in choosing our staff”, explains Hala Rashed Fahim, IT, AOS & HR partner in Cairo. “And we place strong focus on helping them acquire the skills and the expertise they need to provide the best possible services to our clients. We don’t hesitate to give true responsibilities to young people. We give them opportunities to develop and grow.  There are two ways we can know we are doing a good job in this area. The first is the fact that our clients are happy with us and have stayed with the firm for a long time. The second is our staff are in high demand: in Egypt, all 4 major global audit and accounting players have a lot of our former people in their own teams, and especially in their tax departments! “

Excellence in service, indeed. But also in behaviour. “We have never compromised with ethics”, says Ahmed Shawki. “None of our partners have ever been in any kind of trouble, and, over 75 years, there has never been any stain on our reputation.” In fact, the partners of Mazars Mostafa Shawki are often appointed as trainers by other regional countries’ accounting or tax authorities. “One of our partners has recently been entrusted with the training of Dubai’s own tax experts”, adds Ahmed Shawki.

We have always been able to adapt to the changes in our environment. Flexibility is one of our true strengths. We know how to adapt our services to new regulations, new expectations from clients and stakeholders or new technologies.

Innovation and agility 

Innovation and the ability to adapt have also been key components in the firm’s ongoing success over almost a human lifetime. “In a lot of ways, we have been pioneers”, Ahmed Shawki states. “In 1942, when the firm was first created, there was no tax law in Egypt. Still, my father decided to start a tax practice inside the organization, and to let it be known.”

“We have demonstrated our willingness to innovate in many ways, shapes and forms”, adds Hala Rashed Fahim. “In the 80s, we were one of Egypt first accounting firms to heavily invest in computers. At the time, it represented a massive investment. It was also very revolutionary, at that time, in the local context. And we trained our people. In terms of technology, we were very much ahead of the game.” 

Looking ahead and taking initiatives, being bold without being reckless, have always been trademarks of Mazars Mostafa Shawki. “We are not afraid of building new services, but we want to make sure we can ensure their continuity”, Ahmed Shawki affirms. 

And that is where adaptability comes into play. “We have always been able to adapt to the changes in our environment. Flexibility is one of our true strengths. We know how to adapt our services to new regulations, new expectations from clients and stakeholders or new technologies.” 

Egypt’s number one tax practice 

There is one area at least in which the search for excellence and the constant will to innovate gave spectacular results: tax. Created as soon as the firm was founded – before Egypt and the Arab world had any real tax regulations – Mazars Mostafa Shawki’s tax practice has now become the country’s number one. “We are the leading tax experts in Egypt”, Yasser Maharem partner and Head of the Mazars Egypt Tax practice, explains. “Mostafa Shawki himself was a tax expert. It is the capacity he began to work in, with the Egyptian Ministry of Justice. When he decided to start his own business, he also decided to use his tax expertise to serve the Egyptian economy.”  

So, over time, the firm grew and expanded its tax skills. And gradually established and reinforced its reputation as the country’s most competent organization in the field of fiscal matters. “We allocated specific resources to the ongoing improvement of our tax teams”, says Hala. “Not just for hands-on assignments, but also to be able to provide insights and thought leadership. Ahmed Shawki is the head of the Arab Tax Society. And, to this day, we are the only firm in Egypt that has created and operates a research centre dedicated to tax issues.  And we are very proud to be able to say we are consulted by the Egyptian government prior to the writing and passing of any new tax-related law or regulation.”  

The firm as a big family 

“This might sound somewhat corny”, Ahmed Shawki explains, “but we do see our firm as a big family. We work with each other and we care for each other.”  

“Every year, we celebrate the end of the Ramadan with a big Iftar. We invite our staff and partners, but also our alumni, those who have left us to go work for either large competitors or clients”, Hanan Abdel Kader, Financial Consulting Partner in charge of Marketing says. “And we are pleased to see that most of them come to spend this special moment with us, and tell us it is like coming back to their family. This is something we cherish and want to uphold. Both because we are proud of it, and because it helps us maintain good relationships with them and their new employers.” 

I see it as my duty to maintain the continuity of our firm and of our business. Getting to the top is the easy part. The real challenge is to stay at the top.

Stability, stewardship and sustainability 

At Mazars, we believe stewardship is essential to the sustainable growth of businesses. We are convinced companies that manage to develop overtime are those that stay true to their founders’ values and are able to successfully pass on knowledge, expertise and leadership from one generation to the other. Mazars in Egypt is no exception. “Since its creation, our firm has only had three Managing Partners”, Ahmed Shawki explains. “I think the fact our governance is remained stable for 75 years is one of the reasons we have managed to stay in business and grow overtime.” 

“As for me, I certainly was not programmed to take over”, Ahmed Shawki explains. “I was not originally an auditor. I graduated as an engineer, because in then socialist Egypt, there was no real perspective for accountants and auditors. So when the time came to pick a career, I went for something different. I only decided to follow in my father’s footsteps after Anwar Al-Sadat reopened the economy. At the time, he asked me if I wanted to do it as his son or as myself. I replied I wanted to do it as myself. So he said: “Go to the United Kingdom and become a legitimate Chartered Accountant there. Then you can come back as Ahmed Shawki, Chartered Accountant”.  

Ahmed Shawki came back in 1981. In 1985, he became a partner. At the time, the firm was part of the Arthur Andersen network, which it left five years later. Today, as the Managing Partner of Mazars in Egypt, and as the son of the firm’s founder, Ahmed Shawki feels a special responsibility. “It is a very challenging situation”, he says. “I see it as my duty to maintain the continuity of our firm and of our business. Getting to the top is the easy part. The real challenge is to stay at the top. A lot of practices go down when their founder or owner leaves. I have to make sure someone will take over and keep the firm going. People here are very attached to the Shawki name, and they want to keep it. In Egypt, the law says auditors are individuals, not firms. We are trying to change that, but it is not easy.”  

Reinventing our professions, for the sake of the public interest  

While nothing can be taken for granted, there are objective reasons for optimism. “We have a young generation of very bright, IT-savvy people. They will help us move forward.” And moving forward will entail adapting to a fast changing environment. “Our profession is challenged. We know audit will become more automated. So audit practices might shrink and the profiles of the people we bring on board will change. We will increasingly need people with skills in data management, data analysis and generally, information technologies, more than business school graduates. Overall, I am convinced our role will still matter. After all, we are the only true protectors of the shareholders’ interests, which gives our opinion a crucial importance.”