KPMG Australia’s New CEO Commits to Culture Change

KPMG Australia has appointed long-term partner John Sams as CEO, replacing Andrew Yates, who resigned over the firm’s ongoing audit leaks scandal, as reported by the Australian Financial Review.

“My immediate focus is to provide confidence to our clients and people,” Sams said. “I will provide clear leadership, deliver the action plan in full, make measurable progress on culture, integrity and transparency, and support our people through the change ahead.”

Sams, who has worked at the firm for more than 20 years and has been serving as both CFO and acting COO since Eileen Hoggett’s resignation in June, acknowledged the firm’s failings directly. “The challenges are real,” he said, adding that KPMG’s behavior “fell short of the standards rightly expected of us.” He pledged to “lead the changes that will make us better, whatever that takes.”

The appointment drew criticism from senators on both sides of Parliament. Labor Senator Deborah O’Neill called it “the elevation of yet another member of the leadership which oversaw the series of botched investigations and non-action.” Liberal Senator Paul Scarr was equally pointed, arguing the firm’s framing of the scandal was inadequate. “They didn’t fall short, they committed an egregious breach of trust,” he said.

Among Sams’ first tasks will be implementing cost-saving measures, with internal sources suggesting job cuts could exceed 1,000. A Parliamentary hearing is scheduled for August 14, at which Sams is expected to appear.

In a “Weekend Reading” article published earlier this month, Starling Founder & CEO Stephen Scott reflects on the crisis facing KPMG in Australia and elsewhere, arguing that, for an assurance firm, a failure of accountability is existential.

“KPMG sold trust as a service to clients and then treated trust within its own walls as optional,” he writes. “But trust is not a service. Trust is earned through accountability. And when those in the trust business seek to design away accountability, they design away any claim to our trust.” ▸ Read More