Investment Analyses–
Accenture, plc
Overview
Accenture plc provides management consulting, technology and outsourcing services. The Company’s business is structured around five operating groups, which together consists of 19 industry groups serving clients in industries globally. The Company’s segment includes: Communications, Media & Technology, Financial Services, Health & Public Service, Products and Resources. The Communications, Media & Technology segment serves the communications, electronics, technology, media and entertainment industries. The Financial Services segment serves the banking, capital markets and insurance industries. The Health & Public Service segment serves healthcare payers and providers, government departments, public service organizations, educational institutions and non-profit organizations. The Products segment serves consumer-relevant industries. The Resources segment serves the chemicals, energy, forest products, metals and mining, utilities and related industries. The company is headquartered in Dublin, Ireland. Accenture is the world’s largest consulting firm in regards to amount of revenue taken in.
Industry Outlook
Ticker / ACNMarket Value of Investment
Investment Group / Student
Equity
Management
Industry / Software and Services, & IT Consulting
IVA Rating / AAA
The information technology consulting industry continues to experience growth because of worldwide technological advances associated with just about all industries. The necessity of data management continues to be imperative in order for businesses across the globe to adjust their business functions in order to become more efficient, turn a profit, and properly manage companies. The IT industry is expected to grow 3% annually over the next five years (IbisWorld). “Key economic drivers for this growth will be rising corporate profit and increased private investment in computers and software” (IbisWorld). The barriers to enter the industry are relatively low, but the competition is very high. Large, powerful firms such as IBM & Accenture dominate the Industry. Regardless, smaller corporations continue to enter the market due to the increase in demand.
ESG Related Issues
The key issue with Accenture is Privacy and Data Security. A surge in privacy and data breach controversies for Software and Services companies are up 400% since 2010, 10x more than any other industry. However, Accenture scores an 8.2, vs. the industry average of 4.3 in the Privacy and Data Security Category. Accenture has strong privacy and data security in place to deal with possible risks: such as hackers and others factors leading to unintentional information disclosures.
In the issue of Human Capital Development, Accenture has “sector leading training and engagement programs for its extensive and highly skilled workplace” (IVA Assessment) and the employee benefits help score ACN in the 72nd percentile, scoring a 4.6 in comparison to an industry average of 3.3 in the Human Capital Development category in comparison with other IT Consulting companies. For the sixth year in a row, Accenture has been listed as “Fortune’s Top 100 Companies to work for.”
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-David Zucker for the Sustainable Investing Advisory Committee
October, 2015
References
"About Accenture."About Accenture. Web. 22 Sept. 2015.
“Accenture Plc.” Yahoo! Finance. Web. 22 Sept. 2015
"Industry Research Reports."Industry Research Reports. N.p., n.d. Web. 06 Oct. 2015.
“TD Ameritrade Login.” TD Ameritrade Login. Web. 23 Sept. 2015.