Unlock Editor’s Digest for free
Roula Khalaf, editor of the FT, picks her favorite stories in this weekly newsletter.
KPMG’s partners have voted “overwhelmingly” to extend Jon Holt’s term as UK chief executive after a turbulent first term marked by his attempts to undermine the Big Four firm’s reputation following a series of issues to restore scandals.
Holt, who took over as UK chief executive and senior partner in April 2021, will lead the company until September 2029, KPMG said on Monday. The extension was approved by a vote of the Company’s 467 equity partners upon the recommendation of the Board of Directors’ Nominating Committee.
Since Holt took over, KPMG has faced numerous challenges. The former audit chief succeeded Bill Michael, who resigned after telling employees to “stop complaining about pandemic working conditions” and calling unconscious bias ideology “complete and utter crap.” had dismissed.
Holt has sought to restore KPMG’s reputation after a series of fines and scandals and boost profits that have lagged those of its rivals in Britain.
Last October, KPMG was fined a record £21 million for failures in its audit of outsourcing firm Carillion. Since 2018, the company has received 17 penalties from the UK accounting regulator and industrial tribunals. The total penalties and costs imposed on the company over this period amount to more than £95 million.
At the time of the Carillion fine, Holt said: “These results are damning.” . I am very sorry that such oversights have occurred in our company. . . I realize that our audit work at Carillion has been very poor over a sustained period of time.”
Holt has sought to move beyond what he calls “legacy cases” and is leading a merger between KPMG’s UK and Swiss businesses to boost growth and profits.
In a statement on Monday, Holt said: “In 2024, we will be making some big changes – combining our deals and advisory businesses into a practice called Advisory – and exploring a possible merger with KPMG Switzerland to give us more collective power to invest and To build new services.”
In the last financial year, KPMG’s UK partners earned an average of £746,000. Sales growth slowed to 9 percent to 2.96 billion pounds, compared with 16 percent a year ago. In November, the Financial Times reported that the company had frozen the salaries of around 12,000 employees in the UK amid a difficult economic environment.
Under Holt’s leadership, the size of the UK partnership was also reduced to less than half the size of rival PwC.
Bina Mehta, chairman of KPMG UK, said the extension was “a reflection of the significant progress he has made in transforming our business and puts us on a strong basis for sustainable growth”.