This year I’ve visited more than 60 KPMG offices across every region of the globe and as I have met with our people, clients and other business and government leaders, I’ve heard a renewed sense of cautious optimism. Yes, there are uncertainties, but there are also tremendous opportunities being created by expanding global markets, new technologies and a new generation of entrepreneurs from emerging markets. I have also seen KPMG people in every corner of our organization applying their talent and resourcefulness to seize these opportunities for clients.
Delivering strong and sustainable growth
The global strategy we are implementing has made us better prepared to help clients succeed in this new economic era. We have focused on key investments in our people, quality, technology and client services, which lay the foundation for sustained profitable growth.
The continued growth of KPMG throughout the financial downturn is a testament to our global strategy, the strength of client relationships and the quality of the work performed. In the 2013 fiscal year, the KPMG network has once again achieved record aggregated revenues of USD23.42 billion.
Rebuilding trust in capital markets
Trust is at the heart of every organization and market KPMG professionals serve. Likewise, we place immense value on the trust placed in our brand and our people. Collectively, we do our utmost to respect and deliver on the responsibility this trust demands. This goes beyond statutory requirements and beyond a compliance mentality. Throughout our organization, training and support center on behaving with integrity and upholding the reputation on which KPMG is built, a topic I regularly discuss in partner and staff forums around the world.
Success depends on continuing to enhance a hard-won reputation for quality in every engagement. This commitment to quality runs deeper than compliance and extends far beyond the regulated parts of the business.
Quality starts with a commitment from leadership and I continue to do my utmost to set the right ‘tone at the top’ to underscore the leadership messages of our global and national leaders. Training and systems are vitally important but cannot fulfill their role without the right behaviors, underpinned by the right culture, values and a clearly articulated code of conduct.
I am proud that during the past year KPMG International was a significant contributor to the work of the B20-G20 Transparency and Anti-corruption Task Force which developed recommendations to improve transparency and corporate governance in emerging markets.
Throughout our history, a commitment to audit quality has been at the heart of KPMG. It has meant a commitment to continuous improvement driven by a rigorous self-review of the KPMG audit process and a willingness to listen to and act on feedback from independent regulators. KPMG professionals have provided leadership for our profession and are making significant contributions to ensuring that the audit profession increases its relevance.
We have made an ongoing, multi-million dollar investment in transforming audit, an approach we refer to as Dynamic Audit. The evolution for the audit process will continue to be complex and challenging. It requires vision and commitment from key stakeholders and, importantly, global cooperation. KPMG’s audit partners around the world have been active and enthusiastic participants in these debates and we remain committed to contributing our leading-edge thinking to the ongoing debate about the future of audit.
Leadership on tax morality
Business taxation and planning has been at the center of public policy and media debate. What began in a few countries as a reaction to perceived aggressive corporate tax planning has developed into a wider global dialogue on the role of fair taxation in a globalized economy. The G20 member states are considering more effective cooperation on tax transparency and collection. And other countries are looking at reforming tax regimes, which in many cases were developed for a world where trade was conducted over the counter and not a wireless network.
KPMG has upheld this responsibility over the course of the past year, particularly in the significant contributions made to public debates on tax morality.
D&A is in our DNA
KPMG is investing in the rapidly growing area of data and analytics (D&A) - helping business create value from the massive volumes of data available today. KPMG professionals have provided D&A services to clients for more than two decades. Over that period the D&A landscape has transformed. This data revolution creates both huge challenges for clients and massive opportunities. Traditionally we have faced the challenge of dealing with the ‘three Vs’ of data – Volume, Velocity and Veracity. To that list we now add the fourth V – Value. Many of the CEOs and executives I have met have emphasized that data is too strategically important and valuable for boards to ignore.
D&A is a transformative issue which is affecting traditional manufacturers as much as digital companies.
In November we launched KPMG Capital*, a new investment fund which supports technology partnerships, strategic alliances and the recruitment of top talent to create new D&A solutions which will help KPMG clients unlock the value in their data.
Investing in growth
KPMG continues to make significant investments targeted at long-term, sustainable growth and is almost half-way through a five year global investment program totaling nearly USD1 billion focused on a core global audit platform, high-growth markets and developing new services.
Emerging, high-growth markets are a central pillar of KPMG’s strategy. Every global client I speak with is interested in building their presence in high-growth markets in Asia, Africa, the Middle East and Latin America. We are expanding our capabilities in these markets, most recently establishing a Global Africa Practice and opening new offices in countries including Myanmar and Mongolia.
We have also invested in internal infrastructure, including a major update of business systems and the launch of a new KPMG internal collaboration platform called ‘The Hub’.
Further significant investments are being made by KPMG member firms in their local markets. Three markets, the US, India and Mexico, are highlighted in this report.
High performance culture
Over 45,000 partners and staff have been recruited around the world over the last year, taking the total number of KPMG partners and staff to 155,000, representing a net increase of 3,000 over the year. Growth and investment plans are expected to create many more high quality professional roles in the years to come, helping ensure KPMG firms remain an employer of choice for exceptionally gifted and ambitious graduates and professionals.
A strong, shared sense of purpose
This is an exciting time to be leading KPMG International. We have a strong and well developed strategy and a willingness to take bold investment decisions that will further develop our capabilities around the world. As we reach the mid-point of our five year strategic investment program, clients are experiencing the benefits of a better connected network.
Over the next year we will strive to ensure that the KPMG brand is recognized for trusted professional services across the 155 countries where we operate by continuing to create a winning culture, providing success for clients and satisfaction for our people. We will contribute value and purpose to society and will continue to invest in sustainable growth for the benefit of our people and our clients.
*KPMG Capital is an investment vehicle for KPMG member firms to invest in data and analytics tools and solutions. It is not open to third-party investment.
**The financial information set forth represents combined information of the separate KPMG member firms that perform professional services for clients. The information is combined here solely for presentation purposes. KPMG International performs no services for clients nor, concomitantly, generates any client revenue.