Governance

KPMG Australia is part of a global organisation of independent professional services firms, with more than 270,000 partners and employees working in member firms spanning over 140 countries and territories around the world.

KPMG International has set out strong governance for overseeing member firm activities around the world, setting policies and aligning our strategy with our Purpose. The Global Board is the principal governance and oversight body for KPMG International and currently consists of 24 members from across KPMG’s global network. KPMG Australia is represented on the KPMG Global Board by our National Chairman.

Detailed information on KPMG International’s structure, leadership and governance can be found on Governance – KPMG Global.

KPMG Australia is led by Chief Executive Officer, Andrew Yates. The CEO leads the firm’s principal management body, the National Executive Committee. The management of the firm is overseen by our National Board. Individual Office Chairs provide leadership at a local level.

KPMG Australia’s governance arrangements are set in part by our membership of KPMG International and the associated rights, responsibilities and obligations of our network arrangements.

In addition, we are bound by all relevant regulations applicable to a professional services firm in Australia, and the KPMG Fiji and Papua New Guinea (PNG) member firms which operate in the South Pacific Practice are likewise bound by relevant regulations in their jurisdictions. KPMG offers a range of services subject to specific regulatory requirements, including audit, tax, advisory, engineering, property, insolvency and restructuring, sustainability reporting, data security, forensic services, and our client-facing legal practice KPMG Law to name a few.

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. This year, we also implemented a new Governance, Regulation & Compliance Board Committee to further strengthen our approach to risk.

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.

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 likely to detrimentally impact our relationship with one or more of our clients.

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.

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 led by our firm’s Human Rights Working Group. KPMG Australia’s Chief Risk Officer and Chief Operating Officer continue to be active participants in, and executive sponsors of, the working group throughout the year.

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

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. The Human Rights Working Group collaborates with a dedicated Human Rights Manager to implement a comprehensive multi-year modern slavery response.

For further information, view our Modern Slavery Statement.