Can an Accounting Major Successfully Break into Investment Banking?

The world of investment banking is heavily dominated by finance and economics majors.

Or, at least, it once was.

Now, we’re beginning to see a more diverse mix of students from STEM, law, business, and even pre-med backgrounds being able to successfully break in.

Yet if you were to ask just about anyone in the industry, they’d probably tell you that an accounting degree would be extremely difficult to utilize and leverage into a career in investment banking.

That was the general consensus I got when I was choosing my major, anyways.

I was always quite passionate about accounting, and for some reason that I can’t remember, didn’t want to major in finance at the time, and was hoping that an accounting degree would be enough to help me break in.

But I’m here today to help you explore the accounting major, and see whether or not it really can help you land that prestigious job offer at an investment bank.

Can an Accounting Major Get Into Investment Banking?

Well, the short answer is yes.

It’s possible.

But it might require a few extra steps on your part as an accounting major to successfully get in.

Now for the long answer.

Let’s take a look at the traditional pathway into investment banking, and then also the challenges that accounting majors might face when trying to break in, as well as how they can overcome these barriers to entry.

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The Conventional Pathway Into Investment Banking

The most common pathway into investment banking used to be a finance degree, paired with a couple of internships, that eventually got turned into full time return offers.

However, these days, we’re seeing more and more students from diverse disciplines of study working in investment banking.

That’s because investment banking recruiters have begun to shift away from the idea that all bankers need to have a finance background.

Instead, the main thing they’re looking for from your educational background is actually to see whether or not you’ve developed a strong analytical mind.

For this reason, candidates with highly quantitative degrees such as engineering and statistics have often been more competitive than and won job offers over traditional finance students (probably looking at grades and all the other factors).

So, the dynamics of the industry are changing, and we know that a finance degree is no longer the only option.

However if you were still really unsure of what to study, but wanted to go into investment banking, majoring in finance would still be your best bet, as that’s the one that directly feeds into investment banking careers.

Now let’s go into what challenges an accounting major might face.

The Challenges Accounting Majors Might Face When Trying to Get Into Investment Banking

Lack of Perceived Financial Knowledge:

An accounting degree teaches you about the nuances of recording and interpreting past financial information about a company.

However, it does not teach you all that much about the financial markets, capital markets, financial theories, and so on.

All of which are crucial components to successfully performing well in your investment banking career.

Employers will know this, and if everything about two candidates were the exact same but one came from a finance background and the other studied accounting, the job would go to the finance student.

Differences in Networking Opportunities

Finance students are often given the most extensive networking opportunities available at university, as in reality, finance is the field where networking matters the most.

This could be through coursework, events, career fairs, etc.

Accounting students may need to work harder to build connections in the investment banking community, possibly on the side by themselves by attending external networking events, spending more time on LinkedIn, and just generally putting in more effort to establish those relationships.

How an Accounting Background Can Be Beneficial for Investment Banking

In this section, I’ll quickly go over some of the strengths that an accounting major would have coming into a career in investment banking, and why an accounting background is one of the best backgrounds to have outside of finance, if you want to get into banking.

Analytical Skills

Just like finance students and other quantitative STEM degree students, accounting majors have a strong aptitude for financial analysis, and being able to read and interpret financial data.

This include the ability to analyze multiple financial statements, understand cash flows, debts, and assess the financial health of a business.

In terms of analytical skills, accounting majors have everything they need; just in a different field of study.

Knowledge of Financial Regulations

Accountants have extensive knowledge of financial regulations.

They understand all the laws and regulations surrounding the recording and accounting of financial data, and have everything they need to be able to navigate these limitations and factors when it comes to processing deals in investment banking.

How an Accounting Major Can Boost Their Chances of Breaking Into Investment Banking

As I said earlier, an accounting major might want to take extra steps to help boost their chances of breaking into investment banking, as they are inherently disadvantaged against the other pure finance majors.

Supplementary Education

Accounting students may want to choose to do extra coursework and gain other certifications on the side, to help them get up to speed with the world of finance, and being able to successfully break into investment banking.

Read more:

There are plenty of investment banking courses online that you can take, such as the following:

Additional Networking

Accounting majors should actively seek networking opportunities, attend industry events, and look for opportunities to go to coffee chats or informational interviews.

Remember, as an accounting student you might not get as many networking opportunities handed to you as a finance student would, meaning you might have to do some extra on your own to make up for it.

Additional Pathways

An accounting student might find it tough to break into investment banking right out of college.

it might be tougher to land those penultimate year internships, and tough to land positions in graduate programs or grad schemes.

Therefore, it’s not uncommon for accounting majors to gain a few years of experience working in a related field like corporate finance deals/analysis at a big four accounting firm, and then lateral into an investment banking role (often on the associate level) after a few years of experience.

Closing Thoughts

Although an accounting degree is likely to be one of the best alternative backgrounds you can have outside of finance that can get you into investment banking, you’ll still likely face more challenges and obstacles than a pure finance major would.

The skills you’ll develop are pretty similar, and you’d certainly be well equipped for the job in that regard, however we cannot ignore that it is a different field of study, and that the things you’d learn would not be as directly applicable to the real work in banking.

Breaking into investment banking with an accounting background is certainly possible and has been done before, however it might just require a few additional steps and some more effort that other pure finance students might not have to worry about as much.

I hope this article has been helpful, and that you’ve been able to learn something from it.

If you’d like to learn more about excelling and other top business careers such as investment banking and accounting, check out the rest of the Medium publication, Grad Excel!