The report on the evolution of the profession at mid-tier firms, launched at an event at Chartered Accountants Hall yesterday (Monday), revealed that 86% of those surveyed rank private equity investment (PEI) among their top three macro trends driving change in the profession, up from 57% last year. [1].

The pursuit of growth is a key driver for firms considering private equity, as they look for innovative ways to expand their business, the Institute said. Other factors including broadening geographical reach and service lines through M&A, access to skills and talent and technology investment were also commonly cited. Most firms reported positive outcomes as a result of PEI in these areas.

In total, a quarter of mid-tier firms surveyed have secured PEI at some point, while 25% expressed a likelihood of pursuing it in the next three years, twice as many as in 2024. Additionally, the vast majority have engaged in board-level discussions about exploring PEI, the report found.

However, not all firms are receptive to the private equity trend, the research found. For three-quarters of firms that are independently-owned – of which 93% have been approached by at least one private equity house in the last three years – PEI was not an attractive proposition.

These firms were primarily concerned about the impact it would have on a firm’s culture and people strategies. Eighty-five percent of those for whom PEI wasn’t attractive said it could negatively affect talent retention, 80% were worried about the potential cultural and ethical alignment and the impact on their firm’s unique values and identity, while 65% thought that pursuing private equity would negatively impact succession to senior roles.

Alan Vallance, ICAEW Chief Executive, said:

“Our firms have told us that private equity interest in the mid-tier accountancy sector remains high, and while we expect this trend to continue and become a major force shaping the future of the profession, it is important to recognise that private equity is not a one-size-fits-all solution to growth. For every firm that identifies opportunities to broaden its reach or invest in tech, another will recognise it as a threat to culture and talent retention.

“Beyond doubt, however, is the crucial role mid-tier firms play in supporting the national agenda for economic growth. The professional services sector was identified as a key growth driving sector in the government’s new industrial strategy, and the impeccable fee growth reported by firms in this report clearly demonstrates why our sector’s contributions to the economy are held in such high regard.”

Growth in mid-tier strong

The research also revealed that all firms surveyed reported a growth in fees this year, compared to 93% in 2024, in a clear sign that the mid-tier market is thriving.

New clients (94%), increased spend by existing clients (69%), increased charge out rates (64%) and mergers and/or acquisitions (33%) were the primary drivers for fee growth, the report found. Meanwhile, access to skills (56%) and regulation (33%) were the main barriers for firms.

Nearly half of mid-tier firms (47%) made an acquisition in the last 12 months, while 67% said they are likely to make further acquisitions in the future.

Ninety-seven percent of firms said expanding their client base was the main reason for considering a merger or acquisition, the report found.

Notes to editors: 

Managing Partners and CEOs of 36 mid-tier ICAEW member firms with between 11 and 249 principals took part in the research between February and March 2025.

This research on the evolution of mid-tier accountancy firms explores key themes shaping the profession in 2025, including structural shifts, talent strategies, technology and emerging service line offerings.