…such as “support whistleblowers” and “punish people who do stuff that will give Australian Financial Review an easy 9 months of negative headlines.”
So KPMG Australia is still in its BP era (“we’re sorry“) and have just released KPMG Action Plan Version 2.0 [PDF], a 13-page document outlining all the ways they’ll prevent another Whistleblowergate from happening going forward. Action Plan v2 is a follow-up on the action plan the firm released in June and may not be the final_final_FINAL action plan in this series of remorse-induced responsibility-taking steps.
As you’re reading the following foreword just imagine the sound of 650 KPMG partners self-flagellating in the background, it’s funnier that way:
KPMG Australia (KPMG) plays an important role in capital markets, the economy and society. Many thousands of our people turn up to work every day to do purposeful work, in the right way, with integrity.
The Parliamentary Joint Committee into Corporations and Financial Services inquiry has shone the light on our failings, including unethical behaviour by senior people, and also the human impact of our handling of the whistleblower. We are now focused on ensuring none of this happens again.
We need to own and address these issues. These related to our use of confidential client information, integrity and objectivity of senior personnel, our engagement with a whistleblower and our oversight and management of these issues. We have not met our own expectations, or those of the whistleblower, clients and broader stakeholders.
These failings do not reflect the values of KPMG. We owe it to our people, clients and other stakeholders to understand these failings, learn from them and address them. We are committed to doing so.
Accountability has been taken for these failings, but we know we need to do more. That’s why KPMG is undertaking a program of work to identify and address issues to improve our firm. This program covers our governance, culture and ethics, and controls.
The “more” that they know they have to do is then outlined item-by-item. It’s all pretty boring stuff like independent board members, updating corporate governance, blah blah. But then there’s this:
Text:
We will review and strengthen our conduct and consequences framework to further discourage misconduct and ensure that appropriate sanctions and other consequences are applied if misconduct occurs.
This will include strengthening financial consequences for serious misconduct and increased oversight by the Board of the consequences framework’s application to address the findings and recommendations of the third-party reviews.
We will also consider opportunities to improve transparency of consequences for misconduct and share insights and lessons from ethical conduct matters in an appropriate manner through leadership communications and training.
If necessary, we will seek to make changes to our Partnership Agreement to effect these changes.
The little (C) and (P) icons mean Chartered Accountants Australia & New Zealand (CA ANZ) and Principia Advisory recommendations contributed to the action items. Principia Advisory’s 69-page (nice) Ethical Cultural Review [PDF], released this month, made 14 recommendations to KPMG after they were engaged to conduct an examination of KPMG culture. The above action item falls under recommendation #8. Strengthen the consequences framework and #9. Improve transparency on consequences for misconduct and lessons learned.
Safe to say everyone will be on their best behavior, at least for a while.
