Erica Williams, chair of the Public Company Accounting Oversight Board since January 2022, will step down on July 22, the board announced Wednesday.
Her resignation comes amid renewed political scrutiny of the audit regulator and just weeks after it narrowly avoided being eliminated by Congress. U.S. Securities and Exchange Commission Chair Paul Atkins publicly stated he accepted Williams’ resignation; however, multiple reports say he asked her to step down.
The PCAOB, created in the aftermath of the Enron scandal to oversee public company audits, has operated under the supervision of the SEC. In recent months, it became a target for Republican lawmakers who argued the board had overreached and should be absorbed into the SEC. Though critiques of the move came from both sides of the political spectrum, leaders in the accounting space have questioned whether the SEC has the resources to take on the PCAOB’s oversight function.
In June, House Republicans added a provision to a sweeping tax and spending bill that would have defunded the PCAOB and shifted its responsibilities to the SEC. That provision was ultimately struck down by the Senate parliamentarian, who ruled it was a policy change rather than a budgetary matter and cited the Byrd Rule.
Because the Senate’s budget reconciliation process only allows measures that directly impact federal revenue or spending, the provision to eliminate the PCAOB was deemed ineligible. The decision preserved the PCAOB for now but highlighted the ongoing political push by the new administration to reshape audit oversight in the U.S.
Atkins, who became SEC chair in April, has long been critical of the PCAOB and is now the third SEC leader in a row to replace the board’s chair shortly after taking office.
Aggressive oversight, industry pushback
Reappointed in 2024 under former SEC Chair Gary Gensler, Williams led the PCAOB through what many in the profession viewed as a period of aggressive oversight. Her tenure marked an attempt to shift away from the board’s longstanding reputation for issuing small penalties and focusing on narrow compliance issues.
For years, the board has faced criticism for levying minor fines, even for significant audit failures, and for targeting technical violations, including whether audit firms in other countries were complying with U.S.-based documentation rules despite differing local laws. That approach frustrated many audit professionals and developed into broader arguments that the board could be folded into the SEC.
Williams responded to these critiques by taking a more assertive stance as chair, increasing enforcement, gaining unprecedented access to inspect Chinese audit firms, and imposing record fines, particularly on large global networks. She also advanced proposals to modernize audit standards, including one that would expand auditors’ responsibilities for detecting fraud. The proposal drew pushback from the profession but was backed by investor advocates.
Leadership approach and talent concerns
Before leading the PCAOB, Williams held senior roles at the SEC, worked as associate counsel in the Obama White House and practiced law as a litigation partner. She said those experiences shaped her leadership style. “Quality audits protect people,” Williams said in a May 2024 interview with CFO.com. “Every enforcement matter brings together our talented team that looks at the facts and circumstances and then they apply the stands and rules of the law that come up with a relief amount that they think is to be a deterrent and just.”
She cited her time working with former President Barack Obama as one of the most noteworthy experiences in her career. “One thing I learned from President Obama that I definitely use today is that as leaders, we must set the tone from the top down,” Williams said. “He always made sure that we made decisions based on our mission to help the American people, [and] as a leader, he was always the smartest person in the room, we all knew it, but he never let us know, and he didn’t act like that. He led with compassion.”
She also described the PCAOB’s staff as highly skilled professionals who are working there because they support the function and independence of the board. “We have talented and dedicated staff members who could be at accounting or audit firms or big law firms, schools or other institutions; but instead, they come to the PCAOB in large part because they’re drawn to that mission.”
Also in her 2024 remarks, Williams warned against weakening the board’s independence or merging it into a more politically influenced body because of the important role it plays in investor protection. “This investor protection mission is our guiding light,” she said. “The thing that drives us every day is protecting investors to make sure that they can drive confidence in the markets, so investors can rely on the financial statements they use to make investment decisions that impact their real lives. ”
Although the board remains intact, the criticism that Williams referenced has grown markedly today. The board’s survival was protected by procedural rules, not political support. The Senate parliamentarian’s ruling raised the threshold for future efforts to eliminate the PCAOB to 60 votes, an unlikely scenario in a currently divided Senate. Still, critics of the board may try again. And with Atkins now leading the SEC, further changes to its leadership or mission could come from within the agency itself.
She also flagged a broader concern shared by many in the profession: a shrinking pipeline of new accountants. Williams said firms must do more to attract young talent, especially when it comes to compensation.
“There is one thing that is pretty clear to me as a contributor to fewer students pursuing accounting, and that’s compensation,” she said. “Accounting firms need to pay more for talent [because] the same talent levels they were able to bring on in the past are attracted to other types of jobs in the financial industry, where [today] there is more money to be made.”
As the SEC prepares to name her successor, CFOs of publicly traded organizations are likely watching closely to see whether the PCAOB continues on its Williams-inspired path of stingier enforcement or becomes the next target in a larger regulatory overhaul.
