SYDNEY — KPMG Australia announced Tuesday that its chairman and two senior audit partners have stepped down in connection with the firm’s mishandling of whistleblower allegations that it improperly used confidential client information to win audit business.
Chairman Martin Sheppard, along with audit partners Paul Rogers and Eileen Hoggett, are the latest officials to exit the firm as the scandal continues to widen. The company’s CEO and audit chief had already resigned before these most recent departures.
Interim CEO Stan Stavros addressed the situation in a formal statement: “The decisions announced today are necessary and immediate.”
Stavros added, “We did not meet the standards expected of us, and we recognise the impact this has had on the whistleblower, our people, our clients and the community.”
The controversy centers on allegations that KPMG misused confidential board documents belonging to real estate company Lendlease to bolster bids for major audit contracts. The whistleblower’s claims became public in March and specifically identified Rogers and Hoggett as the lead partners on the Lendlease audit team involved in the alleged misconduct.
Both Rogers and Hoggett are currently under investigation by Australia’s corporate regulatory authority.
In response to the growing controversy, KPMG said it plans to bring on an independent chair and add independent members to its Australian board as part of efforts to strengthen the firm’s governance structure.
