Governance & Leadership

The National Governance Board (Board) is responsible for oversight and monitoring of the firm’s management to drive growth and the long-term prosperity of the firm while engendering trust from the firm’s partners, people, clients, and the wider community.

The Board approves and oversees execution of the firm’s strategy and ensures there are rigorous processes in place for identifying and managing risk and reputational matters, including the firm’s impacts on people, planet, and prosperity. 

There is separation of the Board and management.

The Board reviews the firm’s commitments, strategies and goals on sustainable development and receives updates on progress against Our Impact Plan commitments and associated action plans and targets, such as our Climate Action Plan and our Climate Risk report.

As part of our membership of the KPMG International network and the KPMG South ASPAC Group, the Board is required to comply with consultation obligations and follow policies and procedures as required and appropriate. 

The principal governance document of the firm is our Partnership Agreement, which is overseen by the National Governance Board.

The Partnership Agreement provides guidance on the nomination, selection processes and composition of the Board, including that is has representation from across the firm in terms of gender and diversity, the various professional service lines of the firm. It also requires the Board has the range of skills ordinarily expected of the governing body of a similar organisation.

Elected Board members are elected by the firm’s partners. Annual renewal of Board membership is an important feature of our governance model and contributes to a balanced Board composition, matching fresh ideas and diverse perspectives with continuity and stability.

A Conflicts of Interest register is maintained for Board members, and conflicts of interest are an agenda item for consideration at the commencement of every National Governance Board meeting.

Independents

Over the past six years, our experience has been that independent Board members play an important role in strengthening our governance by imparting contemporary external perspectives and challenging existing approaches. We are pleased to see them feature on the South ASPAC Board, serving as an additional supplement to the governance of the Australian firm. 

The National Governance Board comprises our National Chairman, the CEO, and between three and five elected members and may include independent external advisors.

The National Chairman is responsible for leading the National Governance Board, ensuring it meets its responsibilities of upholding the highest professional standards of governance, quality and integrity, and the overall strategic positioning of the firm. The National Chairman represents the firm both locally and internationally. Market-facing responsibilities include regular engagement with external stakeholders such as regulators, governments and clients.

The role of National Chairman is elected, voted on by the firm’s partners. Each term of office is three years, for a maximum of two terms. Martin Sheppard is our National Chairman, effective from 1 September 2023. Martin Sheppard was also appointed Chairman of KPMG Asia Pacific and Chairman of KPMG’s South ASPAC Group, effective 1 October 2025.  

Carmel Mortell commenced as the firm’s Deputy Chair in October 2024. This role is an important component of our firm’s governance arrangements and ensures continuity of governance leadership. 

The performance of the National Governance Board and its Committees is reviewed biennially. 

The National Governance Board maintains a Skills Matrix setting out the collective skills, expertise and experience considered necessary to effectively govern the firm. The Board Skills Matrix includes skills and competencies relevant to the firm’s people, planet and prosperity impacts. The Board completes a skills assessment to ensure a balanced and expert Board. Board elections for internal Partner candidates seek to close any skills gaps.

Our Partnership Agreement permits the National Governance Board to delegate its duties and powers and to appoint supporting Committees as appropriate. National Governance Board Committees support the National Governance Board in discharging its responsibilities, inform its decision-making and enhance National Governance Board effectiveness with detailed consideration of complex matters undertaken by each Committee and recommendations made to the National Governance Board. 

KPMG Australia is subject to an extensive but often fragmented framework of obligations. Contractual frameworks set by our clients define their expectations and requirements, and are further supported by regulatory and legal obligations, professional standards and codes, and commitments to professional bodies.

Our people are also required to comply with KPMG’s Global Code of Conduct and to meet the expectations of the communities in which we operate. Our Code of Conduct clearly states that we don’t tolerate illegal or unethical behaviour within KPMG or from clients, suppliers or public officials that we work with.

As members of Chartered Accountants Australia and New Zealand (CAANZ), all KPMG partners are subject to Accounting Professional & Ethical Standards (APES) 110 Code of Ethics for Professional Accountants (APES 110), which is issued by the APES Board. KPMG personnel also play an active role as members of a diverse number of other professional associations, many of which have clear expectations of the conduct of their members. As such, our people are subject to extensive regulations, requirements and codes of conduct that require us to maintain high levels of integrity.

The Australian Securities and Investments Commission (ASIC) is responsible for assessing compliance with and enforcing accounting and audit standards. When completing audits of entities subject to the Corporations Act 2001 (Cth), auditors are legally obliged to comply with APES 110. ASIC inspects KPMG’s Australian firm annually.

ASIC is also the regulator of the financial services industry and assesses the applications made to procure an Australian Financial Services Licence (AFSL). KPMG, via two of its corporate entities, holds AFSLs enabling the operation and activities of its financial services businesses.

Our audit practice is registered with the US Public Company Accounting Oversight Board (PCAOB) and with Japanese, Canadian, Luxembourg, UK and German authorities. This is necessary to either participate in audits of global clients or conduct audits of Australian clients who, owing to overseas stock exchange listing requirements, file financial statements in those jurisdictions. The PCAOB inspects KPMG Australia every three years.

Tax and Business Activity Statement (BAS) agents are subject to the regulatory oversight of the Australian Taxation Office and TPB. All legal practitioners are also subject to the oversight of regulatory bodies such as the legal services commissioners, which operate in states and territories. The Uniform Law and Rules set out the framework within which many of our legal practitioners must operate. Our people are also subject to international standards and regulatory regimes where our work extends beyond Australia.

Risk governance

KPMG Australia has a centralised Risk function, and partners with risk responsibilities report to the Chief Risk Officer, who is part of the NEC. Every year, the NEC participates in a facilitated process to identify and assess the key risks which may impact the achievement of the firm’s strategic objectives. Last year, we established a new Governance, Regulation & Compliance Board Committee to further strengthen our approach to risk.

This year, we expanded the risk and regulatory management function of the firm in Australia, with an additional focus on the technology components of transformation and AI tools being developed with and for our clients. 

Our firm also adheres to the Global firm’s Client and Engagement Acceptance and Continuance (CEAC) policies and processes which are designed to help KPMG firms identify and evaluate potential risks, including relevant ESG risks, prior to accepting or continuing a client relationship or performing a specific engagement.

As part of our commitment to always acting with accountability and integrity, we hold ourselves to a set of globally consistent Quality & Risk Management policies and procedures. These are designed to help our people deliver maximum value to clients and wider society by enhancing quality, managing risk, and ensuring compliance with laws, regulations and professional standards.

We also launched a firmwide Risk Appetite Statement, a framework that outlines the types of risks KPMG is willing to take in pursuit of its strategic objectives. This framework is key to ensuring that all decisions align with the firm's goals and values, promoting informed and conscious decision-making. 

AI Governance

AI Governance within the firm has continued to evolve to keep pace with this rapidly developing technology. In addition to the Trusted AI Council, our Trusted AI Office helps ensure the implementation and continuous improvement of our AI governance processes.  

Managing independence

Auditor independence requirements are enshrined in the Corporations Act 2001 (Cth) and APES 110. As an external audit firm, we must continually reinforce the critical importance of auditor independence and be mindful not only of actual conflicts of interest, but also of the perception of conflicts of interest.

At KPMG, we have prescribed policies, procedures and guidance, combining Australian and international regulatory, independence and ethical requirements. All our partners and client service professionals must complete independence training upon joining the firm, and annually thereafter. We also require our people to complete an annual confirmation stating that they have remained in compliance with such requirements during the previous year.

We continue to strengthen our existing governance and risk management processes to help ensure that the decisions we make and the work that we do align with our Purpose and Values.

KPMG's Global Code of Conduct

Our people are required to comply with KPMG’s Global Code of Conduct and to meet the expectations of the communities in which we operate. Our Code of Conduct clearly states that we don’t tolerate illegal or unethical behaviour within KPMG or from clients, suppliers or public officials that we work with.

The Code of Conduct applies throughout all the firm’s activities and business relationships and is integrated and referred to within relevant strategies, action plans, policies, procedures and mandatory training.

Working against corruption

Along with our KPMG’s Global Code of Conduct, our anti-bribery and corruption program is designed to ensure we uphold the highest standards of professional integrity. This includes detailed policies applicable to all KPMG firms and their personnel, as well as training, compliance procedures and an international whistleblowing hotline.

Managing conflicts

Within KPMG, conflicts of interest principally fall within one of the following four categories:

• external audit independence-related conflicts of interest
• adversarial conflicts of interest
• competing party conflicts of interest, and;
• commercial conflicts.

KPMG’s Commercial Conflicts Resolution Committee (CCRC) is responsible for reviewing, maintaining oversight of, and making decisions relating to, but not limited to, commercial conflicts, including proposed engagements, communications, or expressions of thought leadership and external appointments, which may detrimentally impact our relationship with one or more clients, be inconsistent with the firm’s values or purpose or have adverse brand and reputational impacts.

Our policies and procedures include assessing existing or potential conflicts of interest and risk – including reputational, human rights and environmental considerations – through our client and engagement processes and systems. Our people are prompted in our systems to consider whether an opportunity has the potential to give rise to a potential commercial conflict. Such matters are directed to a Risk Management Partner (or delegate) for review and assessment, and where required, the CCRC for consideration.

Prospective clients or engagements with conflicts of interest that cannot be eliminated or safeguarded to an acceptable level (e.g. through the implementation of system information barriers and ethical divider memorandums) are rejected under our policies.

The firm has identified industries with elevated risks and created additional guidance for engagement teams regarding expected minimum practices regarding these unique challenges. With government clients, we are also mindful of competing issues that may arise when working with different departments or even different areas within a department. 

Ethical culture

The Board and NEC play integral roles in the delivery of our firm's culture program, overseeing our objectives and progress. We continue to strengthen our speak up culture through a range of initiatives, complementing our existing speak up channels, which include our People & Inclusion team, Ethics and Independence Partner, Chief Risk Officer, General Counsel and our independently operated KPMG International whistleblower hotline.

We recognise that building and maintaining a strong ethical culture is an ongoing process.

Please see Our Impact Plan for more information on these initiatives.

We continue to strive to meet the standards expected of us by the public.

Read our latest Our Impact Plan for further information on:

• our interactions with government
• public policy engagement
• our response to the Treasury review
  • view our latest submission here  >
• our participation in parliamentary inquiries
• our transparency journey
• political donations.

Our people, clients and other stakeholders entrust us with sensitive data and information. We continue to strengthen the policies, processes, controls, training, and capabilities needed to protect our data from unauthorised access and disclosure or any use beyond the original intent.

KPMG Australia has policies, processes, and governance structures in place to uphold data and information protection, privacy and security. The importance of maintaining client confidentiality is emphasised through KPMG global policies on information security, confidentiality, personal information and data privacy, in addition to specific KPMG Australia policies.

Read our latest Our Impact Plan for further information on:

• how we manage data and cyber risks
• how we build capability and awareness.

KPMG Australia is committed to respecting human rights in line with the UN Guiding Principles on Business and Human Rights, building on our longstanding support for the United Nations Global Compact.

We expect high standards of human rights performance across our people, operations and supply chain and recognise our influence and impact as a professional services firm on the human rights of a range of stakeholders. We are committed to doing what matters by identifying and understanding our impacts, mitigating negative impacts and enhancing positive ones.

In addition to the KPMG International Business and Human Rights Statement, KPMG Australia has a dedicated Human Rights Policy which is supported by a strong governance structure. KPMG Australia’s approach to identifying and managing the risk of modern slavery is led by our firm’s Human Rights Working Group, which is co-sponsored by the firm’s Chief Risk Officer and Chief Operating Officer. 

Human rights are a component of our due diligence procedures included in our Global Quality & Risk Management and People & Inclusion policies.

For further information, view our Modern Slavery Statement.