KPMG taps chief financial officer to lead firm out of leaks scandal
The long-term partner, KPMG’s chief financial officer since last year, has been given a mandate to overhaul the firm after the damaging audit leaks scandal.
KPMG has entrusted chief financial officer John Sams with an imposing rehabilitation job after the leaks scandal that has shredded the audit and accounting firm’s reputation and put it in the crosshairs of regulators.
Mr Sams was on Tuesday named as KPMG’s new chief executive, succeeding Andrew Yates, who was forced to quit the firm in May amid mounting pressure from parliamentarians.
New KPMG chair Michael Ebeid said Mr Sams had the “agility, courage and integrity” to lead the firm and was armed with a mandate from the board “to strengthen leadership and culture, improve confidence with our people, clients, regulators, government and the (Federal) Parliament”.
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By continuing you agree to our Terms and Privacy Policy.“John has the board’s full support to decisively ... address governance and integrity issues and build a stronger, more accountable firm,” Mr Ebeid said.
Mr Sams started his career with KPMG as a graduate in the UK tax practice in 2003 before moving on secondment to Australia in 2006.
A partner for the past 10 years, most of his time at the firm in Australia has been spent in providing advice on major infrastructure projects. He has been CFO since September.
KPMG is under regulatory and parliamentary pressure over its failure to properly investigate now substantiated claims by a whistleblower that it misused confidential information from an audit client, Lendlease, to pursue other audit jobs and then harassed the whistleblower out of the firm for raising the allegations.
The scandal, which escalated after the allegations were raised in Parliament in March, has also cost the jobs of former KPMG chair Martin Sheppard, chief operating officer Eileen Hoggett and two audit partners.
It has also triggered renewed demands for tougher regulation of the accounting and audit sector following a similar leaks scandal at PwC.
Mr Sams promised to do “whatever” was needed to make KPMG “better”.
“I do not underestimate the task ahead but commit to our clients and people that I am prepared to be courageous, take the tough decisions and lead the changes we need to set us on the right path,” he said.
“The firm fell short of the standards rightly expected of us, and the accountability for these failures will continue to be implemented.
“We have serious work to do on our culture, our leadership and our governance and it will take resolve and endurance.
“Despite everything we have faced so far, I am optimistic about the future otherwise I would never have taken on this role.
“I will lead the changes that will make us better, whatever that takes.”
His priority will be implementing an “action plan” announced by KPMG last month that included the appointment of the firm’s first independent chair, an overhaul of its governance and a review of its whistleblower program.
In an extraordinary indictment of its culture, KPMG also mandated new training to ensure its staff are aware of their obligations on client confidentiality, privacy and information protection, “with additional targeted confidentiality training for all audit partners and directors”.
The firm’s failings are now the subject of several outside inquiries by the Australian Securities and Investments Commission, the Department of Finance and Chartered Accountants Australia & New Zealand.
Originally published as KPMG taps chief financial officer to lead firm out of leaks scandal
