1 July 2022 – 30 June 2023

KPMG Australia

CONTENTS
Chairman and CEO statement

03

Our progress at a glance04

Our structure and operations

07

Governance08

People23

Planet35

Prosperity

44

Material topics assessment

64

This report covers the relevant activities of KPMG Australia, KPMG PNG
and KPMG Fiji (referred to collectively as ‘KPMG Australia’) for thefinancial year to 30 June 2023, abbreviated as ‘2023’ in the report,
unless otherwise stated. It should be read in conjunction with KPMGInternational’s Our Impact Plan, released in April 2023.
This report has been prepared in alignment with the WEF IBC Stakeholder
Capitalism Metrics and with reference to the Global Reporting Initiative(GRI) Standards.
Detailed mapping to these frameworks, including our GRI Index, can befound in our Databook, which contains our reported data and can be readas a companion piece to this report.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

2

OUR IMPACT PLAN 2023

CHAIRMAN AND CEO STATEMENT
This year has been unlike any other with our profession under the spotlight in
unprecedented ways, heightening community awareness and expectations on
integrity, confidentiality and trust.
With this in mind, we present KPMG Australia’s third‘Our Impact Plan’ – with voluntary disclosures on progressagainst 21 public commitments we’ve made on governance,
people, planet and prosperity. These disclosures are madeagainst best practice frameworks using the WEF IBC
Stakeholder Capitalism Metrics and with reference to the
Global Reporting Initiative (GRI) standards. In addition, we aresharing our progress against our long-standing commitment
to the UN Global Compact Principles and the United Nations
Sustainable Development Goals (SDGs) most relevant to us.
We’ve matured our reporting, including introducing ascorecard to allow the opportunity to simply compare ouryear-on-year performance against these commitments.
We’ve increased our transparency, including publishingdata on our partners’ remuneration for the first time; andexplaining more on our culture program. For example,
through actively encouraging our people to speak up if they
are concerned about unethical or inappropriate behaviours,
we’ve seen an increase in complaints reporting. We present
why we view this being a sign of progress.

It is crucial that we remain vigilant in regularly reviewing ouroperations to ensure they are aligned with the standards
expected by the Australian community. Australia needs
strong capital markets, and a trusted professional services
sector is an important part of that system.
We are actively participating in the government inquiries,and strongly support the package of reforms recently
announced by the Federal Government as a significant,sensible and constructive step forward in restoring trust in
our profession. As you’ll read, we supported a number of therecommendations in the Parliamentary Committee process
and will actively engage in the reform consultations process.
KPMG will continue to reflect on our own operations andchallenge ourselves to do more to meet standards expectedof us and strengthen trust. We see even greater scope foradvancement if the profession moves together, working
constructively with the Federal Government and ourregulators to consider what reforms might be required.

The report covers the activities of KPMG Australia, KPMG
PNG and KPMG Fiji for the financial year to 30 June 2023.

We look forward to working co-operatively with the inquiries
and with government to produce practical enhancements on
regulation to strengthen our sector with benefits for capital
markets, the Australian economy and society more broadly.

We’ve engaged Grant Thornton to undertake an independent
assurance readiness assessment for selected people metrics
supporting our impact plan commitments this year. It’s ourintention to progress towards external assurance on this nextyear, as well as some key financial metrics.

Thank youWe’ve both had the privilege of serving our entire careerswith KPMG. Over the past three decades, we’ve witnessed
the transformation and growth of our firm. When we
commenced, KPMG was an accounting firm providing
accounting and tax advice and conducting audits. Today,
we are a global, multi-disciplinary professional services
firm delivering insights across the economy, serving boththe public and private sector. Our size, scale and reach are
critical to the value we provide for our people, our clients,
and the wider community. This expanded reach brings
greater responsibility and demands a commitment to ethicalpractices and rigorous scrutiny. We know we are not perfectand have used difficult experiences as opportunities toimprove the way we work.

Alison and Andrew

Alison Kitchen
National Chairman
KPMG Australia

Andrew Yates
Chief Executive Officer
KPMG Australia©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

3

OUR IMPACT PLAN 2023

OUR PROGRESS AT A GLANCE:IMPACT PLAN 2023 SCORECARD
This scorecard contains key progress points for each commitment reported in
Our Impact Plan 2023, for the financial year to 30 June 2023. Further information
can be found in our Impact Plan Databook 2023.
Legend	Achieved:
Positive progress:

Target or key initiatives have been achieved or exceeded.
Substantive advancement against target or key initiatives.

	Insufficient progress: Progress against target or key initiatives was slower than expected or unsatisfactory.
	

Not achieved:

Target or key initiatives have not been achieved.

N/A:

Progress point not applicable or not available for the year.

GovernanceImpact Plan Commitment

FY23 Progress metric

2023

2022

Always act with a clear Purpose

Purpose Index (in development)

N/A

N/A

Drive a responsible tax practiceAnnual confirmation statement
published in line with the Australian
Tax Advisory Firm Governance Best
Practice Principles (Yes/No)

Yes

N/A

To lead the profession in audit quality

Multi-year Audit Quality
Transformation (AQT) in progress

N/A

N/A

We Do What is Right: Integrity
at KPMG – training completion(target is 100%)

100%

100%

‘People can challenge their leaderswhen necessary without fearing
negative consequences’1

74%

63%

‘AT KPMG, we have a cultureof doing the right thing’2

94%

97%

‘People can report unethical practices
without fear of any negative impact
on them’3

87%

85%

Privacy and Security Awarenessfor Everyone (S.A.F.E) – training
completion (target is 100%)

100%

100%

Notifiable data breaches

Zero

Zero

Confirmed instances where the firmcaused, contributed to, or was directly
linked to bribery, corruption, or
modern slavery incidents

Zero

Zero

Act lawfully, ethically and in
the public interest

Uphold the highest level of information
protection, data privacy and security

Respect human rights and work against
corruption and modern slavery

FY23 Progress update

Positive progress

Achieved

Positive progress

Achieved

Positive progress

Achieved

1

Based on the percentage of respondents rating the related questions favourably within our Ethical Culture Index (ECI) survey.

2

Ibid.

3

Ibid.

Achieved©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

4

OUR IMPACT PLAN 2023

PeopleImpact Plan Commitment

FY23 Progress metric

2023

2022

Provide a great people experience,
built on our People Promise

Engagement Index4

75%

75%

Partner gender balance – women in
partnership (40% target by 2025)

35.1%

33.4%

Partner gender pay gap (target isyear-on-year reduction)

11.58%

12.46%

Employee gender pay gap (target isyear-on-year reduction)

9.9%

11.4%

Culturally diverse partners(20% target by 2025)

14.5%

11.4%

Indigenous people hired(target of 31 people in FY23)

19

32

Protect the health and wellbeing ofour people‘I am able to sustain the level of energy
I need to do my work’5

55%

53%

Foster a continuous and future-fit
learning and development culture

Average learning hours
per employee

35
hours

33.5
hours

Simpler, more inclusive recruitment
process to attract world-class talent

Talent Attraction and Recruitment
Reimagined program

N/A

N/A

FY23 Progress metric

2023

2022

Change in gross Scope 1, 2 & 3
emissions (50% reduction target
by 2030 against 2019 baseline)6

-43%

-78%

Spend towards suppliers with Sciencebased net zero targets (80% target by 2025)

40%

N/A

Champion gender equality and create
an inclusive and equitable culture for all

4

Based on the percentage of respondents rating the question favourably within our Global People Survey.

5

Ibid.

FY23 Progress update

Positive progress

Positive progress

Positive progress

Positive progress

Positive progress

Not achieved

Insufficient progress

Positive progress

Positive progress

PlanetImpact Plan Commitment

Decarbonise our operations andsupply chain towards net zeroSupport our clients’ and Australia’s
transition to net zero

Understanding the carbon intensity of
0.181kg 8
our client portfolio (kg CO2-e/$ revenue)7

Strengthen climate resilience
with our people, clients andcommunity partners

Engagement in climate-related
initiatives (50% target by 2030)

N/A

N/A

Advance our commitment to circularity

Waste diversion/recycling rate
(90% annual target)9

71%

68%

Understand and improve our
impact on nature and biodiversity

Investment in improving outcomesfor nature and biodiversity

N/A

N/A

0.106kg

FY23 Progress update

Positive progress

Positive progress

Positive progress

Insufficient progress

Not achieved

Positive progress

Calendar year data to 31 December 2022, and 31 December 2021 respectively.
Figure refers to data for latest financial year available (FY22 and FY21 respectively). Please see our Databook for methodology.
8This figure has been updated following a transcription error.
9
Calendar year data to 31 December 2022, and 31 December 2021 respectively.
6
7©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

5

OUR IMPACT PLAN 2023

Prosperity
Impact Plan Commitment

Strong economic contribution

FY23 Progress metric

2023

2022

FY23 Progress update

Total revenue ($bn)$2.553$2.341Up by 9.1%

Taxes paid ($m)

$815

$690

Up by 18.1%

Number of people employed10

10,173

10,084

SteadyExceptional client outcomes, through workthat matters

Client satisfaction score(target is >8.5 out of ten)

8.7

8.7

Build a thriving technology business andinnovate with our clients, alliance partners,
and the startup ecosystem

Developed new technology solutions
for our firm and our clients

N/A

N/A

Community investment contribution11$12.9mN/A

Addressable procurement spend
with Indigenous enterprises(3% annual target)

3.82%

3.22%

39

26

Create a fairer, more inclusive
and more sustainable future forour communities

Advocate on the issues that matter

Number of submissions toGovernment, Parliamentary Inquiries
and policy papers

10

Includes full-time, part-time and casual employees in Australia, Fiji and PNG. Excludes partners and contingent workers.

11

Please see our Databook for methodology.

Achieved

Positive progress

Positive progress

Achieved

Positive progress©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

6

OUR IMPACT PLAN 2023

OUR STRUCTURE
AND OPERATIONSKPMG Australia is part of a global organisation of independent
professional services firms, with more than 265,000 partners
and employees working in member firms spanning 143 countries
and territories around the world.

We provide professional services to organisations across a wide range of industry, government and civil society sectors.
Our service areas during the year were organised as Audit, Assurance & Risk Consulting (AARC); Deals, Tax & Legal (DTL);
our mid-market practice, KPMG Enterprise (Enterprise); Infrastructure, Assets & Places (IAP); and Management Consulting (MC).
From 1 July 2023, these will change to Audit & Assurance, Consulting, Deal Advisory & Infrastructure, Enterprise, and Tax & Legalfollowing the introduction of a new operating model aimed at greater global alignment, improved efficiency, and optimal deliveryof our firm strategy.
This report covers the relevant activities of KPMG Australia, KPMG PNG and KPMG Fiji, referred to collectively as KPMG Australia.
KPMG Australia’s primary focus is to serve clients based in Australia, as well as Fiji, Papua New Guinea (PNG) and six other
South Pacific nations through the South Pacific Practice. We have offices in every state and territory capital within Australia,
including recent office openings in Geelong and Parramatta. KPMG PNG has its office in Port Moresby, and KPMG Fiji has offices
in both Suva and Nadi. KPMG Australia holds a small number of minority shareholder interests in entities based in Australia; aswell as a small number of minority shareholder interests in overseas operations, which we co-own with other KPMG firms andwhich we do not control.
KPMG Australia makes a strong economic contribution, employing more than 10,000 people and partners across Australia, PNG
and Fiji. This includes an intake of more than 877 graduates this year, and 96 new partners. KPMG Australia posted revenue of$2.553 billion and paid taxes of $815 million for the financial year ending 30 June 2023.
The firm’s strategic ambition is ‘to make a positive impact on society as the number one choice for world-class talent,empowering our clients to be exceptional and delivering profitable above-market growth for KPMG’.
We believe that our multidisciplinary model is the best way to serve our clients, our people and society, ensuring we bring thebreadth of expertise and skills from across our organisation to tackle any issue or opportunity. It allows us to be an agile andresilient business that can more easily respond to market conditions and it makes us a more interesting and exciting place forour people to work. The multidisciplinary model ensures our Audit professionals have access to skills beyond traditional auditing– from ESG, data analytics and artificial intelligence to cloud computing and blockchain – all of which are crucial to deliveringhigh-quality audits. A Tax practice enhanced by the skills and perspectives that Audit and Consulting professionals provide helps
to promote more holistic tax administration and management and advance the Responsible Tax agenda. Organisations require aholistic approach to meeting their climate and broader ESG commitments, which the combined services of the multidisciplinarymodel enables.
Many of our people hold relevant professional memberships and accreditations including with the Chartered Accountants Australia
and New Zealand (CAANZ), Engineers Australia, the International Bar Association, the Law Societies of NSW, Queensland,South Australia and Victoria, The Tax Institute, and Australian Institute of Company Directors (AICD). Our organisation is also amember of other associations, including Business Council of Australia (BCA). KPMG is a registered tax agent under the Tax Agents
Services Act 2009 (Cth).

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

7

Governance
Our Purpose and Values guide everything we do

OUR COMMITMENTS
Always act with a clear Purpose
Drive a responsible tax practice
To lead the profession in audit quality
Act lawfully, ethically and in the public interest
Uphold the highest level of data and information protection, privacy and security
Respect human rights and work against corruption and modern slavery©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

8

OUR IMPACT PLAN 2023

Scorecard

GovernancePeoplePlanetProsperity

OUR GOVERNANCE
PROGRESS
Purposeful business

STRUCTURE AND GOVERNANCE
KPMG has strong governance for overseeing our activities,
setting policies and aligning our strategy with our Purpose.

Purpose, values
and culture
OUR COMMITMENT: ALWAYS ACT WITH A CLEAR PURPOSE
EMBEDDING OUR PURPOSE IN EVERYTHING WE DO
Our Purpose – to inspire confidence and empower change –is underpinned by our Values – Integrity, Excellence, Courage,
Together and For Better. These guide our culture, the decisions
we make, the work that we do and the way we behave witheach other, our clients and all our stakeholders.
To help us measure our progress against our commitment toalways act with a clear Purpose, we have started developinga Purpose Index, which we will be reporting on from 2024.

Integrity
We do what is right.

Excellence
We never stop learning and improving.

Courage
We think and act boldly.

TogetherWe respect each other and find strengthin our differences

For Better
We do what matters.

KPMG International
KPMG International Limited acts as the coordinating entity
for the overall benefit of the KPMG global organisation. The
Global Board is the principal governance and oversight body for
KPMG International. It currently consists of 22 members fromacross KPMG’s global network. KPMG Australia is a member
of KPMG International and is represented on the KPMG Global
Board by our National Chairman.
Representation on the Global Board gives the Australian firm an
opportunity to influence KPMG’s global agenda and champion
initiatives with positive global economic, environmental andsocial impact. The Australian firm is also well-positioned toleverage the skills and experience of others on the Global Board
to strengthen the impact of initiatives in our own market.

KPMG Australia
KPMG Australia’s governance arrangements are set in partby our membership of KPMG International and the associatedrights, responsibilities and obligations of our network
agreement. In addition, we are bound by all relevant regulations
and guidelines applicable to a professional services firm
providing audit, tax and advisory services in Australia.
Delivering to our Purpose requires an ongoing commitment
from our Board and executive leadership team, the National
Executive Committee (NEC).
KPMG Australia’s distinct governance model sees partners
vote for the appointment of our Chair and Board members.
The Chair and Board appoint KPMG’s CEO and also approveappointments to the NEC.

National Chairman and Board
The National Board is KPMG Australia’s key governing body,
responsible for overseeing management and conduct of the
firm. The Board is comprised of the National Chairman, the CEO,and nine other members – currently including two independent
Board members who play a key role ensuring we hold ourselvesto account to the expectations of the community.

Purpose Index in development, to bereported from 2024
©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

9

OUR IMPACT PLAN 2023

Scorecard

GovernancePeoplePlanetProsperity

OUR GOVERNANCE
PROGRESS
Each year we take the opportunity to renew and refresh our
Board composition and two new members were elected to join
the Board, with effect from 1 July 2023. The Board comprises
6 women and 5 men.12 The partnership has also elected
Martin Sheppard as the firm’s next National Chairman effectivefrom 1 September 2023, succeeding our current Chairman
Alison Kitchen, who has been in the role since 2017.
The role of National Chairman at KPMG is responsible firstand foremost for holding the firm to the highest professional
standards of governance, quality and integrity to engender
trust from our people, clients and community. The separation ofBoard and management is critical for the appropriate oversightand holding to account of our CEO and Executive team on all
aspects of performance.

CEO and National Executive Committee
KPMG Australia is led by Chief Executive Officer (CEO),
Andrew Yates. The CEO is responsible for the effective
management of the firm in accordance with the strategic
direction, plans and policies approved by the National Boardand the implementation of appropriate regulatory and risk
management procedures in each of the businesses of the
firm. The CEO heads the firm’s principal management body,the National Executive Committee (NEC), which drives theexecution of the business strategy and establishes processes
to monitor and enforce policy compliance. The NEC comprises
6 women and 7 men.13

KPMG LEAP STRATEGYKPMG Australia is committed to being a purpose-ledorganisation. Our Purpose and intent to make a positive impact
on society are embedded in our ‘KPMG LEAP’ sustainablegrowth strategy. In this second year, we have made good
progress in how we inspire our people, deliver exceptional
outcomes with our clients and accelerate our investment anduse of cutting-edge technology. This report provides updates on
relevant elements of the firm’s strategy across our Governance,
People, Planet and Prosperity sections.

CHIEF PURPOSE OFFICER
In 2021, we established the role of Chief Purpose Officer(CPO). The CPO has played a critical role in decisions made by
KPMG’s Commercial Conflicts Resolution Committee (CCRC)
during the year (see ‘Managing conflicts’ further in this section).
The CPO has also focused on educating and challenging ourleaders and our teams to actively bring our Purpose to thecentre of their decisions and to reflect on how these alignwith, and support, the commitments we have made as a firm.
12

At 1 August 2023.

13

Ibid.

OUR COMMITMENT: DRIVE A RESPONSIBLE TAX PRACTICE
KPMG Australia is an active supporter of the firm’s Global
Principles for a Responsible Tax Practice, which were revised
and published in August 2022 to provide greater simplicity andreadability without changing their essential nature.
This year saw an important step locally with the publicationof the Australian Tax Advisory Firm Governance Best PracticePrinciples.
The Principles have been jointly developed by KPMG, Deloitte,
EY and PwC, with input from the Australian Taxation Office(ATO) and the Tax Practitioners Board (TPB). They aim toenhance public understanding of the important contribution oflarge advisory firms and further build community confidence
and trust in the taxation system. The Principles complement
the robust laws, regulations and professional standards, aswell as the firm’s Values, which KPMG adheres to in its roleas an Australian tax adviser.
Importantly, this development means that KPMG Australia
has made a public commitment on its adherence to the
Principles, through our annual statement available here.
We believe adoption of the Principles helps promotetransparency and enhance public confidence in Australia’s
taxation system and the role of tax advisers. While we haverobust internal processes in place and apply the relevant
regulations and professional standards, the public may have
limited awareness of how we work. The Principles document
is a means of increasing wider understanding.
While we have publicly proposed a review and a strengtheningof these Principles in light of the high expectations the public
has of tax advisers, they are an important step forward. The
Principles complement KPMG’s longstanding Global Principles
and reflect the expectations the public should rightly have ofreputable tax advisers.
We will periodically review the design of our policies,
procedures and controls and regularly monitor theirapplication in the execution of tax engagements.
KPMG is committed to building integrity within the tax
profession and welcomes moves to strengthen the
TPB. KPMG supports the recommendations outlinedin the Independent review into the effectiveness of theTax Practitioners Board and the Tax Agent Services Act
2009 that relate to strengthening sanctions, improving
individual accountability of partnerships and increasing
TPB independence. KPMG looks forward to further public
consultation on these reforms.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

10

OUR IMPACT PLAN 2023

Scorecard

GovernancePeoplePlanetProsperity

OUR GOVERNANCE
PROGRESSOUR COMMITMENT:TO LEAD THE PROFESSION IN AUDIT QUALITY
Our commitment to audit quality is one of our firm’s highest
priorities and is reflected in KPMG’s Global Audit Framework
which underpins how we deliver quality and consistency in
our audits.

Accelerating our Audit Quality Transformation
In October 2022, we commenced a multi-year holistic Audit
Quality Transformation (AQT) designed to drive a step change
in our audit quality and to improve the audit experience for ourclients and people. The AQT addresses elements of our firm’s
governance framework, audit quality monitoring, our audit
delivery model, people development and includes a significant
technology program designed to improve consistency.
Some of our flagship AQT programs include:• Moving to full implementation of our globally consistenttechnology platform, KPMG Clara, in 2024. Alongside
implementation, we are delivering enhancements tothe tool and its supporting data and analytic capabilities,
including deployment of AI into our audit software tofurther drive improvements to audit quality, efficiency
and accuracy. Technology remains a key area of focus
and investment.
• Deployment of standardised minimum procedures for
specific audit areas, supported by smart documentationthat tailors to client situations and enhanced guidance
for audit partners and teams.
• Significant investment in our second line of defence isalready underway, with a doubling of that function for
the June 2023 reporting season.
• Renewed investment in our learning curriculum, with awide range of relevant courses to develop our people
and their capabilities.

The AQT has already established strong momentum, withseveral key achievements since our launch in October last year.
One key initiative delivered in FY23 was the establishmentof a new subcommittee of the KPMG Australia Board with adedicated focus on Audit Quality. The Audit Quality Committee
has direct oversight of the firm’s audit quality strategy, culture,investment plan and compliance with our system of
quality management.
Recently we also launched improved guidance for teams
to better demonstrate our professional scepticism andseparately deployed a range of mandated, globally standardised
procedures through our KPMG Clara Workflow (KCW) platform.
The NEC and Audit Quality Committee of the Board regularly
monitor a range of audit quality metrics including the results of
independent inspections of audit files. As reported previously
to the market, the results of the ASIC inspection program
published in October 2022 were disappointing, with the firm
recording an increase in the relative percentage of audit quality
findings reported by ASIC, 48% in FY22 (FY21: 30%, FY20:26%). For KPMG, ASIC selected 8 higher-risk, complex audit
files from the 5,000-plus opinions we issue each year for our
1,600 audit clients.
We observed an improvement in our internally inspectedfinancial statement audit engagements, with 84% ofengagements receiving a pass rating (FY22: 78%). There
were no restatements of financial reports or reissuancesof audit opinions due to any of the findings.
While we acknowledge the challenging environment forauditing professionals in Australia and around the world, we
set high standards for ourselves. We are acting and doing
everything we can to continuously improve our audits.
We believe that the comprehensive AQT Plan will continue
to improve the quality of our audits and the audit experiencefor our clients and our people. While we are in the earlystages of our comprehensive AQT, we are making progress
and are committed to our plan.

• Full adoption of the new international standard of
quality management International Standard on Quality
Management (ISQM)1.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

11

OUR IMPACT PLAN 2023

Scorecard

GovernancePeoplePlanetProsperity

OUR GOVERNANCE
PROGRESSCASE STUDY

Embedding cutting-edge AI into Audit
Following successful pilot programs in the US, UK and Canada, KPMG Australia has this year begun embedding AI
into audit software as part of a major technology investment designed to improve audit quality. The new tool works byincorporating advanced statistical, machine learning and rules-based analytics to analyse transactions and classify theminto low, medium and high-risk populations. This investment in AI will allow clearer risk categorisation of transactions andenable us to analyse 100% of our clients’ transactions, instead of manual sampling.
Over time, it will help us significantly improve our audit quality, efficiency and accuracy. Following the conclusion of thelocal pilot program, KPMG Australia is working to roll the tool out to around 200 engagements by next year.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

12

OUR IMPACT PLAN 2023

Scorecard

GovernancePeoplePlanetProsperity

OUR GOVERNANCE
PROGRESS
Acting transparently withaccountability and integrity

FURTHER TRANSPARENCY

CEO remuneration is determined having regard to both thefinancial and non-financial performance of the firm, including
the strength of leadership behaviours, consistent with ourstrategy and Values. The change in the CEO’s remuneration
in FY23 reflected the financial performance of the firm.

PARTNER REMUNERATIONFY23 ($)

FY22 ($)

Our industry is facing ongoing scrutiny around firm structureand governance. This year, we have increased our transparency
including the following.

CEO – remuneration(excluding long-term incentive13)

2,200,000

2,800,000

Partnership Agreement

Average (mean) remuneration– equity partners

700,000

750,000

In an Australian-first, the firm shared its KPMG Australia
Partnership Agreement 2022 with the Senate Finance andPublic Administration References Committee for public
release. While partnership agreements have typically not
been in the public domain, the move in July 2023 recognised
people want to know more about the organisations withwhom they work and engage.

13

The CEO has a long-term incentive (LTI) arrangement which ismeasurable over an initial 3 year term through to 2024.

NEC MEMBERS (INC CEO):REMUNERATION ($)

FY23

FY22

750,000-1,000,000

1

1Partner remuneration

1,000,000-1,250,000

3

2

KPMG has also released partner remuneration data for the
first time to support a better understanding of partners’
remuneration and how it is determined.

1,250,000-1,500,000

1

11,500,000-1,750,000

411,750,000-2,000,000

2

12,000,000-2,250,000

2

32,250,000-2,500,000–

32,500,000-3,000,000–

1

KPMG Australia sets out clear performance and conduct
expectations for partners. The remuneration model isdesigned to drive and reward performance and behaviours
consistent with our strategy and Values.
Our NEC and the Partner Remuneration and Nominations
Committee review the process to ensure that the system forallocating the profit pool to partners is administered fairly andequitably and is subject to a formal Board approval process.
Partner remuneration is variable every year and subject tothe performance of the business.
During the year, partners receive monthly drawings and, fromtime to time, additional profit share distributions. Both thesum and timing of any additional distributions are decided
by the NEC, taking into account the firm’s cash requirementsfor operating and additional investment activities.
Any matters of conduct that may have arisen during theperformance year are also considered, and appropriate
remuneration consequences applied. The model promotes
clarity and transparency among the partnership regarding
their own remuneration and that of other partners.

Moving to external assurance
We are continuing to mature our approach to reporting andthis year have engaged Grant Thornton Australia to carry out
an independent assurance readiness assessment for selected
people metrics. It is our intention to progress towards external
assurance on these metrics, as well as key financial metrics
for FY24.

Political donations
KPMG reports all forms of political donations, including in-kind
contributions, event sponsorships and membership fees forpolitical party business forums. No cash political donations
are made.
In FY23 our political donations were approximately $160,000,
down from $242,455 in FY22. This will be formally reported via
the Australian Electoral Commission in 2024.
Considering the ongoing debate around political donation reform,
KPMG is currently reviewing its Political Donations Policy.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

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OUR GOVERNANCE
PROGRESS
Trusted and trustworthy
KPMG regularly assesses its reputation amongst a variety
of stakeholder groups (including clients, the market, ourpeople, the community, and wider stakeholders) at a global
and local level.
Importantly, we continue to respond to challenges impacting
our firm, our industry and some of our clients, and recognise
our role in preserving, maintaining, and restoring trust.
During the year, unprecedented trust issues have impacted
our profession – most notably the Tax Practitioners Board(TPB) integrity breach matter (refer to our response later inthis section). It is critical that government departments andagencies can engage the specialised skills, knowledge, andexpertise of the private sector to secure the best outcomes
for the Australian people. As part of this process, it is essentialthat government can have absolute trust in the private sector
companies it works with.

OUR COMMITMENT:ACT LAWFULLY, ETHICALLY AND IN THE PUBLIC INTEREST
KPMG Australia is subject to an extensive and complex
framework of obligations that require us to act lawfully,
ethically and in the public interest.

ACTING LAWFULLY
Contractual frameworks set by our clients define their
expectations and requirements, and are further supported
by regulatory and legal obligations, professional standards
and codes, and commitments to professional bodies. Our
people are also required to comply with KPMG’s Global Codeof Conduct and to meet the expectations of communities inwhich we operate.
As members of Chartered Accountants Australia and New
Zealand (CAANZ), all KPMG partners are subject to Accounting
Professional & Ethical Standards (APES) 110 Code of Ethics
for Professional Accountants (APES 110), which is issued
by the APES Board. KPMG personnel also play an activerole as members of a diverse number of other professional
associations, many of which have clear expectations of the
conduct of their members. As such, our people are subject toextensive regulations, requirements and codes of conductthat require us to maintain high levels of integrity.

The Australian Securities and Investments Commission (ASIC)
is responsible for assessing compliance with and enforcing
accounting and audit standards. When completing audits ofentities subject to the Corporations Act 2001 (Cth), auditors
are legally obliged to comply with APES 110. ASIC inspects
KPMG’s Australian firm annually.
ASIC is also the regulator of the financial services industry
and assesses the applications made to procure an AustralianFinancial Services Licence (AFSL). KPMG, via two of its
corporate entities, holds AFSLs enabling the operation andactivities of its financial services businesses.
Our audit practice is registered with the US Public Company
Accounting Oversight Board (PCAOB) and with authorities
in Japan, Canada, Luxembourg, the UK and Germany. This isnecessary to either participate in audits of global clients or
conduct audits of Australian clients who, owing to overseas
stock exchange listing requirements, file financial statements in
those jurisdictions. The PCAOB inspects KPMG Australia every
three years, with our last inspection occurring during FY21.
Tax and Business Activity Statement (BAS) agents are subject
to the regulatory oversight of the Australian Taxation Office and
TPB. All legal practitioners are also subject to the oversight ofregulatory bodies such as the legal services commissioners,
which operate in states and territories. The Uniform Law andRules set out the framework within which many of our legal
practitioners must operate. Our people are also subject tointernational standards and regulatory regimes where ourwork extends beyond Australia.

Managing independence
At KPMG, we have prescribed policies, procedures andguidance, combining Australian and international regulatory,
independence and ethical requirements.
In Australia, auditor independence requirements have beenenshrined in the Corporations Act 2001 (Cth) and APES 110.
As an external audit firm, we are required to be mindful not
only of actual conflicts of interest, but also of the perceptionof conflicts of interest. Compliance with these obligations
requires us continually to reinforce the importance ofauditor independence.
All KPMG Australia partners and client service professionals
must complete independence training upon joining the firm,
and annually thereafter, and complete an annual confirmation
stating that they have remained in compliance with suchrequirements during the previous year.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

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OUR GOVERNANCE
PROGRESS
Payments time reporting

Ethical culture

We understand that cash flow is a key issue for all businesses,
especially small businesses, and late payment of their invoices,or lengthy and extended payment schedules can be a threat totheir wellbeing or even survival.

Our Board and NEC are deeply involved in the delivery of our
firm’s ethical culture program, commitments, and associatedmetrics. Areas of key focus this year have been upskilling
our people in how to make better ethical decisions andstrengthening our speak up culture.

As a signatory of the Australian supplier payment code, KPMG
has a positive record of prompt payment that we continue towork to improve. We also report against the Payment Times
Reporting Scheme, introduced by the Australian Government
in 2021. We currently pay 95% of our Small Business Supplierinvoices within 30 days.

ACTING ETHICALLY
We continue to strengthen our existing governance and risk
management processes to help ensure that the decisions
we make and the work that we do align with our Purpose.

We continue to proactively measure the impact of our ethicalculture initiatives to understand what’s working well, what weneed to do more of, and where in the business experiences
may not be in line with expectations.
This year, 94%14 of our people agreed that ‘At KPMG, wehave a culture of doing the right thing’ (from 97% last year).
Proactively managing our culture to reinforce ethical conduct
and alignment of behaviours with our Purpose and Values isa priority for our firm.

KPMG Code of Conduct
The KPMG Code of Conduct (the Code) outlines the
responsibilities all KPMG people have to each other, ourclients and the public. It shows how our Purpose and Values
guide our behaviours and actions. The Code covers a wide
range of topics, including integrity and ethical behaviour,
professionalism, confidentiality, independence, and compliance.

Managing conflicts
KPMG’s Commercial Conflicts Resolution Committee (CCRC)
is responsible for reviewing, maintaining oversight of, andmaking decisions relating, but not limited to, commercial
conflicts, including proposed engagements, communications,or expressions of thought leadership likely to detrimentally
impact our relationship with one or more of our clients.
Our policies and procedures include assessing existing or
potential conflicts of interest and risk – including reputational,
human rights and environmental considerations – through ourclient and engagement processes and systems. Prospective
clients or engagements with conflicts that cannot be eliminatedor safeguarded to an acceptable level (e.g. through theimplementation of system information barriers and ethicaldivider memorandums) are rejected.

THIS YEAR

100%
74%
94%
87%

COMPLETION
We Do What is Right: Integrity
training at KPMG

People can challenge their leaderswhen necessary without fearing
negative consequences(up from 63% in 2022)15

At KPMG we have a culture of doing
the right thing(down from 97% in 2022)16

People can report unethical practices
without fear of any negative impact(up from 85% in 2022)17

14

Based on the percentage of respondents rating the related questions favourably within our 2023 Ethical Culture Index (ECI) survey.

15

Ibid.

16

Ibid.

17

Ibid.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

15

OUR IMPACT PLAN 2023

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OUR GOVERNANCE
PROGRESS
New ethical decision-making framework
Following a pilot program last year, we fully introduced our
ethical decision-making framework, to provide our people withan easy-to-use, evidence-based and standardised approachto making ethical decisions:• Recognise that there is an ethical issue.
• Identify options to resolve the issue.
• Grapple with options, informed by ethical commitments.

Educating our people and our leaders about the new policy
has been critical. We conducted partner education sessions
and refreshed our annual mandatory training this year, with
de-identified case studies. We want to ensure they are clearthat they are role models for inclusive behaviour who support
our people to speak up safely and respond when any concerns
are raised. We have also provided trauma-informed training
to frontline employees such as our People and Inclusion
Business Partners, Employee Relations, Work Health and
Safety, and a team of Mental Health Peer supporters.

• Highlight potential risks and eliminate weaknesses.

Speak up culture• Take action in line with their decision.

We want everyone to have a voice at KPMG. Reinforcinga ‘speak up’ culture has been a priority for the firm and we
encourage our people to raise concerns early before they
become more serious issues.

Every employee and partner in the firm has had exposure to
this Framework and will continue to every year. In addition,over 200 of the firm’s most senior leaders have taken partin a facilitated workshop to provide hands-on practicalexperience with the framework and enable them to rolemodel ethical decision-making to their teams.

Integrity training completion
Everyone at KPMG is required to undertake the firm’s We dowhat is right: Integrity at KPMG training covering our Codeof Conduct, as well as a separate Privacy training module,
upon joining the firm, and annually thereafter. Completion ismonitored and managed.
This training was refreshed this year to further strengthen our
ethical culture and included learnings on KPMG Values and Codeof Conduct, case studies on allyship, rationalising your decisions,
inducements, bribery, confidentiality while working from home,
insider trading, social media guidance and retaliation.
There was a 100% completion rate of the training undertaken
in October 2022.

Respect@Work
Last year, we introduced our new human-centric Respect@Work
policies, which restate our zero-tolerance position on bullying,forms of discrimination, harassment and victimisation. We arefocused on listening and ensuring that greater support is provided
to those who raise concerns, including access to a group of peer
allies who can provide trauma-informed support, informationand guidance.
We have created clear guidelines on how we will respondto ensure any concerns raised are treated with care, andthat investigations are managed objectively. We have alsoenhanced our reporting to monitor and track impact including
regular updates to our NEC and Board.

Our focus remains on the most significant drivers to encourage
a speak up culture, including open communication and easily
accessible channels that enable our people to raise concerns,
supportive leadership behaviours and security and support forpeople who do speak up.
During the year we commenced the implementation of an
Ethics Champions Network (ECN) – a network of trusted
employees that provide colleagues with access to support
and guidance on ethical decision-making, how to successfully
navigate ethical dilemmas, and offer an additional escalation
channel that enables the firm to identify and act on instancesof misconduct sooner.
The network is currently active within three divisions andwill be expanded across the rest of the firm to reach over
60 Champions. The network complements existing ‘speak
up’ channels, such as our People & Inclusion team, theEthics and Independence Partner, the Chief Risk Officer;
the General Counsel and our global and independently
operated whistleblower hotline. We also updated the firm’s
Whistleblower Policy this year to improve its alignment with
the UN Guiding Principles on Business and Human Rights.
We continued to embed psychological safety content into
mandatory training and formal development pathways for ourpartners and leaders, and to encourage and prioritise a speak
up culture with senior leaders through discussing it in town
halls, Partner Roadshows, and firm-wide communications.
This year, we also introduced a Retaliation Monitoring System(RMS), to detect possible instances of retaliation occurring
because of people speaking up, enable the fair investigationof possible instances of retaliation, and provide our people
with the assurance that they have the firm’s support and areprotected to speak up.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

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OUR GOVERNANCE
PROGRESS
Workplace complaints
We continue to empower our people to speak up about any
unethical or inappropriate behaviour in the workplace. We areseeing an increase in confidence in our investigation process
which has been supported by our use of de-identified workplacecases in our Respect@Work training and by the introductionof our Retaliation Monitoring System. Our leaders are engaged
and invested in empowering our people and strengthening our‘speak up’ culture. For these reasons, we view an increase inreporting in the short term as a sign of progress.

We take all matters raised seriously and where thecomplaint has been substantiated, one in four people
who were the subject of the complaint were exited fromthe firm. The remaining employees received a warning,counselling and (as applicable), an adverse impact to theirend of year rating and payments. One in two substantiatedsexual harassment complaints ended in the subject of thecomplaint exiting the firm.

CONDUCT COMPLAINTS

2023

2022

Complaints raised

142

8818

Complaints closed out19

131

69

Complaints raised per 100 employees

1.24

0.66

Breach of the Code or policies (other than sexual harassment)

127 (89.4%)

79 (89.8%)

Sexual harassment

15 (10.6%)

9 (10.2%)

All

84 (64.1%)

38 (55.1%)

Breach of the Code or policies

7620 (63.9%)

31 (51.7%)

Sexual harassment

821 (67%)

7 (77.8%)

TYPES OF COMPLAINTS RAISED   

SUBSTANTIATED CLOSED OUT COMPLAINTS

18

19 complaints raised in FY22 have been closed out in FY23.

19

A complaint is ‘closed out’ where it has been completed following an investigation and outcome.

20

Of 119 Code or policies complaints closed, out of 127 complaints raised.

21

Of 12 sexual harassment complaints closed, out of 15 complaints raised.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

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OUR GOVERNANCE
PROGRESSCASE STUDYTaking responsibility forreinforcing our ‘speak up’ culture
Psychological safety was identified as a priority for the firm in 2020
when we conducted a comprehensive third party ethical culture
review. At KPMG, we refer to this as our speak up culture. It can beexperienced in many ways and at different points in an employee’s
journey. One of the most critical ways this impacts our businessand our profession is through speaking up around conduct andethical behaviour.
For this reason, we use the Ethical Culture Index (ECI) survey as ourprimary measure. The ECI is an evidence-based assessment tool thatenables our people to provide us feedback on various aspects of our
ethical culture. It enables us to identify aspects of our culture that
require development and identify emerging priorities. We ran the ECI
in 2020, 2022 and 2023 and the result trend is indicating year-on-year
improvements:•

At KPMG, people who challenge their superiors when necessary
do not fear negative repercussions – 74%22 favourable in 2023,
up from 63% in 2022 and 58% in 2020.

•

People at KPMG can report unethical practices without fear of
any negative impact on them: 87% in 2023, up from 85% in 2022
and 75% in 2020.

•

Fewer people are observing any form of misconduct or unethicalbehaviour: 11% in 2023, down from 13% in 2022, 28% in 2020.

From the time people join us to when they leave, our listening
touchpoints – which include our annual Global People Survey (GPS), ourwellbeing survey, onboarding surveys (at two months and six months)
and our exit survey – allow us to hear our people’s concerns and makeinformed decisions to address issues to improve their experience.
We know culture is not ‘set and forget’ and although we are making
good progress, we are clear that more work needs to be done.

22

A percent favourable score in the ECI represents the total percentage of people who responded to an item using Somewhat agree, Agree, or Strongly agree.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR GOVERNANCE
PROGRESSACTING IN THE PUBLIC INTEREST
KPMG Australia is committed to ensuring our work adds
value to the public service – whether that be implementing
technology changes, project managing infrastructuredevelopment, assessing and protecting against risk, orassuring due process and controls. Consulting firms havea strong incentive to deliver value for money given thehighly competitive nature of the market.
When working with clients (government and non-government),
we have a duty to operate with the highest level of integrity,
confidentiality and trust. When government engages with us,
we never take this trust for granted and we must, and do, takeour responsibilities seriously.

Our interactions with government
We are privileged to work with government on many
confidential matters either in a commercial capacity or inan advisory role. We recognise the specific responsibilities
that come with these interactions, and understand we must
maintain a focus on integrity.
KPMG has an established single point of contact for all
government consultations, with clear guidelines for interactingwith government on policy consultations. Relevant outside
government advisory and appointed roles must be disclosed
in a firmwide internal database of personal appointments.
Undertaking these roles also requires partner and risk
management approval.

Participation in and response to the Senate inquiry into consulting
On 9 March 2023, the Senate Finance and Public Administration
References Committee commenced an inquiry into the
management and assurance of integrity by consulting services
provided to the Australian Government. On 16 June 2023,
the Senate agreed to extend the timing of its final report until
30 November 2023.
KPMG Australia welcomed the opportunity to provide a
submission and appear before the Committee.

At the hearing, our CEO Andrew Yates outlined three reform
initiatives to help restore trust in the profession:• We proposed a review and strengthening of the Tax
Advisory Firm Governance and Best Practice Principles.
This could be achieved by codifying the voluntary code
into legislation.
• We recommended the introduction of an integrity charterfor working with the Australian Public Service. At the endof every piece of work, the government could assess
compliance with the charter.
• We advocated a government review into whether
ASIC should have an extended regulatory role over
our profession.
In addition, we advised that we will not tender for the newLabour Hire Services panel in support of the government’s
commitment to building capacity in the Australian
Public Services.
In our submission, we outlined steps taken to reinforce ourconfidentiality frameworks following the public disclosure of theTax Practitioner’s Board (TPB) integrity matter. These included:• Reinforcing our confidentiality obligations to our people.
• Conducting a third party review of our confidentiality
obligations, which found our policies and procedures wereconsistent with best practice and guidance publishedby relevant professional bodies. Further, it identified
several recommendations for further strengthening ourcompliance, in the areas of training and guidance forour people, which we have implemented.
• We also noted our support of Treasury’s review ofconfidential consultations, as well as a strengthened TPB.
Further, in early May 2023 we also shared a refreshed
Confidentiality Policy with all our people, outlining the personal
and professional confidentiality obligations they must always
comply with.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

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OUR GOVERNANCE
PROGRESSOn 26 May 2023 our Chairman and CEO provided an update
via email to all partners and employees advising of theseriousness of the TPB integrity matter. The note highlighted
the gravity of the issue and reiterated our duty to operatewith the highest level of integrity, confidentiality and trust.
It also reminded our people of our role when working withgovernment and of the additional responsibilities that suchappointments carry.

Upper House inquiry into the NSW Government’s use andmanagement of consulting services
This inquiry was established on 31 May 2023. KPMG provided
a submission on 17 July 2023.
KPMG’s submission recommends several opportunities for
integrity, transparency and value for money improvements.
We support the NSW Government’s commitment to increase
penalties for improper disclosure of confidential government
tax information and we support strengthened processes inrelation to confidential consultations.

Federal Government announces reform package in response
to PwC tax leaks scandal
On 6 August 2023, the Federal Government announced aseries of reforms in response to recent integrity challenges
within the consulting industry, aimed at restoring publicconfidence in our profession. The reforms are aimed atstrengthening the integrity of the tax system, increasing
the power of regulators and strengthening regulatory
arrangements to ensure they are fit for purpose.
We welcome this announcement and strongly support thispackage of reforms as a significant, sensible and constructive
step forward in restoring trust in our profession. We supported
a number of the recommendations during the ParliamentCommittee process and look forward to actively engaging in
the consultation process.
Legislation is expected to be introduced later this calendar year.

We support greater transparency of consulting spend andcontinuous improvement in procurement frameworks.
These include better centralised collection and reportingof procurement data through a single platform, options forbetter public service knowledge and skills uplift and thatgovernments consider the introduction of an Integrity
Charter for working with the Public Service.
KPMG’s submission notes that we are proud to support
the work of the NSW Public Service and we appreciate theopportunity to support the important work of the Committee.

Inquiry into Structural Challenges in the Audit, Assurance
and Consultancy Industry
On 22 June 2023, the Parliamentary Joint Committee on
Corporations and Financial Services resolved to commence
an inquiry into structural challenges in the Audit, Assurance
and Consultancy Industry (including but not exclusive to the‘Big Four’).
KPMG Australia welcomes the additional inquiry and will be
providing a submission to the committee in August 2023.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR GOVERNANCE
PROGRESS
Information protection,
data use, privacy
and security
OUR COMMITMENT:UPHOLDING THE HIGHEST LEVEL OF DATA
AND INFORMATION PROTECTION, PRIVACY AND SECURITY
Our people, clients and other stakeholders entrust us withsensitive data and information. We continue to strengthen thepolicies, processes, controls, training and capabilities needed
to protect our data from unauthorised access and disclosureor any use beyond the original intent.

MANAGING DATA AND CYBER RISKSKPMG Australia is required to protect our people and client data
against loss and exploitation. It is critical that we ensure that
we have appropriate governance structures in place to manage
data and cyber risks, especially in the context of increasing
cyber attacks globally.
Crucial to our management of data risks, we have continued
to enhance our reporting of cyber and data risks to the NEC,which receives a quarterly update on the current threat
landscape and the monitoring carried out by our Cyber
Security Operations team.
During the year, we implemented continuous improvement to
the following key activities:• Monitoring and alerting capabilities – allowing us to respondto priority security concerns even faster.
• Security testing program – ensuring timely reviews of
security risks across our technology platforms and software,
including aligning our assessments of cloud environments.
• Threat hunting – bringing in additional technology andsecurity operations analysts to identify ‘sleeping’ threats.
• Uplifting patching – clearly identifying software threats andvulnerabilities and applying patches to address these.

DATA PRIVACY AND SECURITY UPLIFT
Working in a hybrid environment and through cloud-based
document management presents new opportunities andchallenges with respect to our firm’s data management
and security.
We continue to proactively support and upskill our people tounderstand the risks posed not only to themselves but to ourfirm and our clients. We undertake regular phishing campaigns
to educate our people on how to identify phishing attacks.
Everyone at KPMG is also required to complete Security
Awareness for Everyone (S.A.F.E.) training on an annual basis
to refresh their awareness and knowledge of the range of
information security, personal information, and data privacy
risks we are exposed to at work and at home.
This year we have focused on uplifting our security behaviour by:• Providing new starters with security education training,
focusing on their role in addressing threats early at the userlevel (increased phishing simulations, new starters letter,
Cyber Fundamentals training).
• Increasing remedial training for privileged users and users
who repeatedly click on phishing simulations.
• Creating new and inventive ways for our people tolearn about data and information security (e.g. our
Cyber Fundamentals training, internal social network
and working closely with our internal communications
team on security related stories).
• Delivering more in-person training sessions including forpartners, directors and new starters, who are now mandated
to complete security training during their induction.
In 2023 we had a 100% completion rate of our mandatory
S.A.F.E training.

100%

completion rateof S.A.F.E training

There were no notifiable data breaches in FY23.23
23

Notifiable Data Breaches are defined as an incident: in which personal or client data is lost or stolen; the integrity of personal or client data is/was affected; personalor client data was/is subject to unlawful disclosure.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

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OUR GOVERNANCE
PROGRESS
Human rights

OUR COMMITMENT:RESPECT HUMAN RIGHTS AND WORK AGAINSTCORRUPTION AND MODERN SLAVERYKPMG has publicly committed to the UN Guiding
Principles on Business and Human Rights, building on
our longstanding support for the United Nations Global
Compact. Human rights are a component of our due
diligence procedures included in our Global Quality &Risk Management and People & Inclusion policies.

WORKING AGAINST CORRUPTION
Along with our Global Code of Conduct, our anti-bribery
and corruption program is designed to ensure we upholdthe highest standards of professional integrity. This includes
detailed policies applicable to all KPMG firms and theirpersonnel, as well as training, compliance procedures and aninternational whistleblowing hotline. During the year, there
were no reports of bribery or corruption for the Australian firm.

HUMAN RIGHTSThis year, we refreshed our Human Rights Policy following
an analysis of contemporary risk factors, interviews with over
20 internal and external stakeholders, and an assessment of
human rights issues most relevant to the firm’s operations
and supply chain. The refreshed policy includes an evenstronger focus on inclusion, diversity and equity and healthand safety. We also developed the firm’s first Human Rights
Action Plan to further embed our commitment to respecting
human rights across four areas: foster a culture of humanrights; demonstrate human rights leadership; embed humanrights into policies, practices and management systems; andtransparency and continuous improvement.

During the year, there were noreports of bribery or corruption
for the Australian firm.

MODERN SLAVERY RISK
Our approach to identifying and managing the risk ofmodern slavery is led by our firm’s Human Rights Working
Group. They work closely with a dedicated Human Rights
Manager to implement a comprehensive multi-year modern
slavery response. KPMG Australia’s Chief Risk Officer andChief Operating Officer/Chief Financial Officer were active
participants in, and executive sponsors of, the working groupthroughout the year.
We carried out our annual modern slavery risk area review,which enabled a greater understanding of the key issues
elevating modern slavery risk in FY23 – including how
challenging global economic conditions may have a flow-on
effect on labour rights within our supply chain and operations.
This review helped focus our efforts on where there is more
likely to be the risk of harm to people and formed the basisof our firm’s commitments for the coming year.
Recognising the importance of continuing to work with ourhigher risk suppliers on achieving alignment with our Supplier
Code of Conduct, we provided them with opportunities for
improvement and as a result closed 27 supplier alignment plans
due to satisfactory actions being taken (with 15 plans remaining
open for further action).
Our fourth Modern Slavery Statement addresses the
mandatory criteria outlined in the Modern Slavery Act 2018(Cth). While we have not yet identified any instances of KPMG
Australia being involved with modern slavery, we continue toapply our methodology to identify and address risk areas, withkey achievements including:• Continuing strong advocacy for modern slavery reporting
requirements by providing a detailed submission to thereview of the Modern Slavery Act 2018 (Cth), where werecommended the introduction of a positive duty onreporting entities to undertake and report on humanrights due diligence, to align with emerging international
leading practice.
• Promoting continuous, mutual improvement in modern
slavery response through external engagement andcollaboration, including through hosting events,
publishing thought leadership articles, and participatingin multi-stakeholder forums.
• Supporting the South Pacific Practice offices to assess
their supply chain for modern slavery risk.
• Training our smaller suppliers on modern slavery
risk identification.
• Engaging a single vendor for branded goods forcorporate functions and internal use to enable more
effective risk management.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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PeopleCreating a caring, inclusive, purpose-led andvalues-driven culture

OUR COMMITMENTS
Provide a great people experience built on our People PromiseChampion gender equality and create an inclusive and equitable culture for all
Protect the health and wellbeing of our people
Foster a continuous and future-fit learning and development culture
Simpler, more inclusive recruitment processes to attract world-class talent©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR PEOPLE PROGRESS

Employee engagement
and experience
OUR COMMITMENT:PROVIDE A GREAT PEOPLE EXPERIENCE,BUILT ON OUR PEOPLE PROMISEOUR NEW PEOPLE PROMISE
Employee engagement and experience are central to all KPMG
people-related initiatives and a critical driver of our businesssuccess. This year, we have enhanced our listening strategy toensure we better understand our people’s experiences and act
on opportunities to support and inspire them throughout theircareer at KPMG.
We established our new People Promise – our Employee Value
Proposition – to identify and articulate what people value about
working at KPMG. Our commitment across the five pillars of
our People Promise helps ensure that all our people and all newstarters understand the whole value proposition of working
with us, what they can expect and what the fundamental
benefits of a KPMG career are.

OUR PEOPLE PROMISE PILLARS
DO WORK THAT MATTERS
Every day, in ways big and small, you makea meaningful and positive difference forclients, people and the communities weserve. Help create opportunities in a worldof increasing complexity.

COME AS YOU ARE
Your unique experiences and perspectives
belong here. Both individually and as ateam, you will understand and value thedifferences that lead to stronger insights
and innovation.

THRIVE WITH US
Build relationships with colleagues whotake care of each other. You will have the
KPMG community at your side, providing
the support you need to be at your bestand create opportunities for yourself
and others.

LEARN FOR A LIFETIME
Grow your own way in an environment
where learning is continuous. Feed yourcuriosity, work with the best on emerging
practices and technologies, and gain anadvantage for life.

MAKE YOUR MARKYour aspirations and initiative make KPMG
better. Wherever you work, be recognised
for the impact you make, the leadership
you show, and the success you create
with others.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR PEOPLE PROGRESSLISTENING CHANNELSKey Global People Survey (GPS) scores 2023

Our firm has implemented several feedback mechanisms over
the years to monitor engagement, hear how we can improve
our people experience and inform our strategy. This includes
our annual wellbeing survey, our Global People Survey (GPS),an Ethical Culture Index, and specific career automated surveys
during onboarding and when leaving the firm.

Data shows the percentage of favourable responses

This year, we also introduced the Partner Performance
Feedback tool to ensure our partners receive feedback on theirleadership behavioural proof points linked to our Values, suchas ethics and inclusion.
Our Board and NEC continue to receive regular insights andupdates on our people’s feedback, ensuring governance andoversight at the most senior level.

Global People Survey
This year and for the first time, we have given everyone in
the firm access to our annual Global People Survey (GPS)data, allowing our people to see results – including qualitative
feedback – at the firm level and for their specific teams. This is
an important step forward in building a more transparent, safe
and trusting environment where people feel they can ‘speak
up’, be heard and be open about their experiences at work.
In 2023, 86% of our people across Australia, PNG and Fijicompleted our GPS, up from 80% last year. We found that:• 92% of people agreed that KPMG does not tolerate
any form of harassment including gender-based andsexual harassment. 6% were neutral and 2% disagreed(new measure).
• 89% of our people are proud to work for KPMG, up from
85% in 2022.
• 82% believed that, overall, KPMG is a great place to build
their career, from 84% last year.
There are opportunities to:• Further improve our open and honest two-way
communication at KPMG, with only 67% believing thisis already in place.
• Improve the way we give recognition and praise, as only
68% of respondents answered this favourably.
• Work further on challenging the ‘status quo’ (our traditional
ways of doing things), with only 62% of respondents
agreeing this culture was already in place.

75

68(compared to 75 in 2022)(compared to 71 in 2022)

79

77(compared to 81 in 2022)(compared to 80 in 2022)

24

Engagement Index

Trust Index
24

Growth Index

Values Index

17% neutral, 8% unfavourable

Understanding how hybrid work impacts our people
The way we work has changed significantly since the COVID-19
pandemic. Workforces around the world have experienced
exceptional circumstances and organisations are now grapplingwith how best to design work and office space to meet theneeds of their people, their teams and their business. With ourown people adopting a range of hybrid working patterns, wefound there was limited research in Australia into how hybrid
work was impacting people and their experience at work.
In February 2023, we commenced a research project as partof our KPMG Chair in Organisational Trust partnership with the
University of Queensland, exploring how hybrid work impacts
our people and our culture, with a focus on critical aspectsof our People Promise including wellbeing, engagement andcollaboration. The results of this work are due later this year.

REMUNERATION TRANSPARENCY AND REWARD
In July 2022, following our total reward and pay policy review
carried out across 2022, we proactively shared remuneration
data with all our people and the market for the first time.
We published information on the salary bands within ourclient-facing core capabilities across the firm: External Audit,
Consulting, Data & Tech, Deals and Tax. Importantly, we believetransparency also contributes to reducing our gender pay gap.
We provided updated data for this year with our people andthe market in July 2023.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR PEOPLE PROGRESS
Inclusion, diversity
and equity
OUR COMMITMENT: CHAMPION GENDER EQUALITY AND
CREATE AN INCLUSIVE AND EQUITABLE CULTURE FOR ALL
Inclusion, Diversity and Equity (IDE) is embedded within our
Values and aligns to our Purpose. We want to attract and retain
talent that is representative of the world in which we live, andto provide clients with diverse teams that utilise their uniqueexperiences and views. We strongly believe that this diversityof thinking leads to improved decision-making and produces
better business outcomes.

This year, we have continued to develop our leaders throughspecific training programs tailored for women. For example, weoffered a women’s leadership program aimed at our manager
level for the first time, complementing existing opportunities
for our high potential leaders above manager level. The program
enables its participants to grow their capability, reflect on thetype of leader they aspire to be and an opportunity to broaden
their personal network. Thirty places were offered in this firstyear pilot, with up to 60 places planned for 2024.
In June 2023, KPMG received our compliance reportacknowledging our Workplace Gender Equality Agency reportsubmission, our 18th consecutive year of participation.

We track our performance on IDE through a people metrics
dashboard, and through our leaders’ performance scorecards,
with progress reported quarterly to the NEC.

GENDER EQUALITY AND EQUITY
We believe that having more women represented in key
decision-making positions delivers better performance, greater
productivity and profitability. We have continued to implement
strategies to help improve women’s participation within our
firm and contributed again this year to furthering research andadvocacy to support gender equity within our economy (see‘Advocating on issues that matter’).
We also support the practice of equity within our business,where resources and opportunities are intentionally pointed
to more diverse and individual needs to achieve moreequal outcomes.
At KPMG Australia, gender equity is inclusive of women, men
and those that identify outside of the binary (such as nonbinary, agender and genderfluid people).
In 2023 we achieved 35.1% women in partnership (up from
33.4% in 2022) – progressing towards our stated target of
40% women in partnership by 2025. We strive for a 40:40:20
gender balance in partnership – 40% men, 40% womenand 20% all genders (which can include men, women andnon-binary people).

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR PEOPLE PROGRESSGENDER PAY GAPBUILDING CULTURAL DIVERSITYKPMG has committed to removing the gender pay gap and wemeasure and report on this in three ways. As of 30 June 2023,
our performance is summarised as:

We continue to build our cultural diversity by investing insystems to improve data collection, encouraging internal
support and engagement networks and consistently
monitoring and challenging bias.

• On a like-for-like basis (i.e. the same job level and employee
profile), our gender pay gap remains negligible (0.1%).
• Our Partner Gender Pay Gap is 11.58%, an improvement
on 2022 (12.46%).
• Our Employee Gender Pay Gap is 9.9%. This measures
the gap for fixed remuneration across the whole firm andis an improvement on 2022 (11.4%).
Australia’s national gender gap, on base salary, is 13.3%(ABS, 2023). One of the key drivers of our gender pay gap
is the lack of women represented in leadership levels.
Our continued focused on equity for women in leadershiproles will assist in closing the gender pay gap across the firm.
We also endeavour to proactively challenge gender bias
by carefully reviewing promotions, rewards and remuneration
decisions and have appointed bias disruptors for each of
our team’s performance review sessions to help ensure
gender equity is considered through these processes andtheir outcomes.

35.1%
11.58%
9.9%

WOMEN IN PARTNERSHIP
up from 33.4% in 2022
40% target by 2025

PARTNER GENDERPAY GAP
down from 12.46% in 2022

EMPLOYEE GENDERPAY GAP

Our Belong network links over 1,400 of our people into acommunity with a shared commitment to foster awarenessand inclusivity towards cultural diversity. Through a Partner
Board and an Employee Advisory Council, the threefocus areas of education and empathy, safe and inclusive
environment, and equity, are reinforced through the firm.
In 2023, 14.5% of partners identified as ‘non-Anglo/Celtic/
European’ up from 11.4% in 2022. We have set ourselves atarget of 20% culturally diverse partners by 2025, to betterreflect the demographics within which we operate, and wewill continue to direct further attention and increase our action
to accelerate our progress.
Monitoring and challenging bias is one of the key mechanisms
we can use to promote equity for culturally diverse people, notonly for partners, but across our pipeline of emerging leaders at
KPMG. Our bias disruptors are specifically trained to proactively
challenge cultural as well as gender bias.
We also have an ongoing focus on developing capabilities tolead an inclusive culture and support our Inclusion, Diversity
and Equity strategy. By expanding our suite of leadershipprograms and increasing the opportunity for our people
to participate, we have strengthened gender and cultural
diversity in our leadership pipeline.
For example, the Illuminate Leadership and Talent
Program, launched in 2021, was designed to address
under-representation of culturally diverse talent in mid-seniorleadership roles and to explore the impacts of culture both
personally and professionally. Participants from culturally
diverse backgrounds develop their leadership capability
while exploring identity and opportunities to build theirpersonal impact and purpose. Partner sponsors involved
get the opportunity to build their own cultural intelligenceand consider their own cultural diversity bias andleadership impact.

down from 11.4% in 2022

14.5%

CULTURALLY DIVERSEPARTNERS
up from 11.4% in 2022

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OUR PEOPLE PROGRESS

Cultural leave
On 1 July 2021, KPMG Australia introduced a Cultural Leave
policy. This enables people to swap an existing public holiday
with a different day to allow them to recognise and celebrate
religious or significant cultural events relevant to their culturally
diverse or Indigenous heritage and religious beliefs. This year,
713 people (from 239 in 2022) have utilised the policy to swap
a public holiday for one that is of more cultural or religious
significance to them.

713 19PEOPLE ACCESSINGCULTURAL LEAVE

INDIGENOUS PEOPLE HIRED
down from 32 in 2022

up from 239 in 2022

INDIGENOUS-INCLUSIVE WORKPLACE
Our Arrilla Digital Cultural Awareness training, which wasmade mandatory for all Australian partners and employees in
September 2021, continues to receive positive feedback fromour people and to help educate non-Indigenous people working
at KPMG Australia to improve cultural and historical awareness.
As of July 2023, 100% of the firm had completed this training.
As part of our Reconciliation Action Plan 2021–2025 (RAP)
leadership commitments, we have also started developinga cultural safety plan, which includes an assessment of thelevel of cultural safety experienced by Aboriginal and Torres
Strait Islander people working for our firm. Led by an external
Indigenous consultancy, the project involves analysing thefindings of our 2017–2020 RAP audit, examining local andinternational best practices in cultural safety and carrying out
a consultation process with internal and external stakeholders.
The initial findings indicate several key themes including astrong focus on the need to address cultural load25, to support
the spiritual and mental wellbeing of First Nations employees,
and to ensure that the roles of Indigenous team members
are not misrepresented on key projects. The final report, withrecommendations on how we address any issues raised, is due
to be delivered in the first quarter of FY24 and will contribute to
our continuous focus on hiring and retaining Indigenous talent.
25

Our RAP has a target to hire an additional 135 Indigenous
people across the 2021–2025 period. As of July 2023,
51 people have been hired since 2021, including 19 in 2023,
falling short of our interim target of 31 people. This will bea focus for improvement in 2024, as outlined in our latest
RAP FY23 Progress Report.

CARING FOR FAMILYKPMG maintained our Family Friendly Workplace accreditationin May 2023, in line with the National Work + Family Standards
developed by Parents At Work and UNICEF Australia. This year,
KPMG was also named Australia’s Best Workplace for Fathers
in recognition of our work to actively support fathers at alllevels, and our broader commitment to create an inclusive
and equitable culture for all.
We continued to provide our market-competitive 26 weeks
flexible parental leave policy which applies to all parents
regardless of gender and is inclusive of adoption, surrogacies,
and foster care children. In the tragic event of stillbirth or forearly pregnancy loss, KPMG also provides leave and resources– including the Pink Elephants Support Network – to support
our people and their managers, and to normalise being able totalk about very difficult life events.
KPMG’s policies on gender neutral parental leave and parttime work are also designed to reduce the stigma around men
accessing these provisions. In 2023, 234 men and 219 women
accessed parental leave, compared to 249 and 218 respectively
in 2022. 94% of people who have used parental leave havereturned to work with the firm.
Approximately 15% of our employees have elder care
responsibilities, and with an ageing population we expect thisnumber to increase. In response, this year we partnered with
Care and Living with Mercer (CaLM) to bring employees aservice to help understand, navigate and plan ageing careand living needs for loved ones.

According to the Diversity Council of Australia Gari Yala report, cultural load is the additional workload (often invisible) borne by Aboriginal and Torres Strait Islander
people in the workplace, which can include expectations to educate non-Indigenous colleagues about Aboriginal and Torres Strait Islander people and racism, andexpectations to talk on behalf of all Aboriginal and/or Torres Strait Islander people.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PEOPLE PROGRESSLGBTQ+ COMMUNITY

BECOME A LEADING EMPLOYER FOR PEOPLE WITH DISABILITY

This year, KPMG launched its Global LGBTQ+ Inclusion
Statement, a unifying driver of inclusion, diversity, and equity
for our people, our firm, and the communities we operate in.
We see diversity as a strength in our workplace. KPMG iscommitted to supporting diversity of sexual orientation andgender identity.

This year, we have been focused on progressing two key
elements of our Disability Action Plan (DIAP) 2021–2023.
Our next plan will have a focus on accessibility and workplaceadjustments:

Following on from KPMG’s global LGBTQ+ Inclusion Statement,
Pride@KPMG in Australia launched its Pride@KPMG Strategy
2023–2026, which seeks to ensure KPMG is an employer ofchoice where LGBTQ+ people thrive.
The network hosted focus groups with participants from acrossthe firm to understand the perceptions of Pride@KPMG and
how the network should deliver LGBTQ+ inclusion. Four key
pillars were defined from these sessions which will guidethe strategic direction of the network for the coming year:• Connection through storytelling• Building safe spaces• Inspiring allies• Together for better.

• Accessibility: In March 2023, we hosted focus groups toassess 38 of our most used digital applications to ensurethat they were accessible to our colleagues with a disability.
This will result in a gap analysis in the second half of 2023,
with recommendations for enhanced accessibility to beconsidered when developing our next DIAP.
• Workplace Adjustments Policy: This has recently beenreviewed to ensure we adequately capture the revised
process for workplace accommodations and details on how
to disclose a disability. The revised policy sets out the useof personalised Success Plans and digital accommodation
passports as well as the scope, responsibilities, andprocedures for reasonable workplace adjustments
requirements such as braille products, services such as
interpreting or captioning, facilities such as ramps or door
openers, or work organisation such as task allocation andflexible work.

Both the national Pride@KPMG Network and its subgroups
such as the Trans and Gender Diverse Network continue togrow in numbers.

MARKET RECOGNITION IN FY23: AWARDS AND SCHEMES

Our focus on trans and gender diverse inclusion and creating
opportunities for LGBTQ+ community to connect continued
this year, with two inaugural events – the Trans and Gender
Diverse Conference and Pride@KPMG Summit which brought
together members of the LGBTQ+ community at KPMG
to help inform the new strategy and amplify the voices of
LGBTQ+ people at the firm.

Australian Workplace Equality Index (AWEI)Gold Employer

Existing policies and programs such as the Gender Affirmation
Policy including the affirmation benefit continued to be accessed
and we recently kicked off the fourth cohort of Leading with
Pride, our LGBTQ+ leadership development program.

Best Workplace for Fathers 2022

Second year recognised

Excellence for Diversity Award (EAPD team)at the Asset Management Council (peak body for
asset management in Australia)

Inaugural award by The Fathering Project

Family Friendly Workplace
Certified by UNICEF Australia and Parents At Workin 2021 with three-year action plan

AWEI Awards Network of the Yearfor Pride@KPMG, for the second year running©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PEOPLE PROGRESS

Employee healthand wellbeing
OUR COMMITMENT:PROTECT THE HEALTH AND WELLBEING OF OUR PEOPLE
We are committed to protecting the health, safety, andwellbeing of our people by providing a safe and mentally
healthy work environment where everyone can thrive.

HOLISTIC WELLBEING APPROACH
Our holistic wellbeing approach provides the programs,
resources and tools for each person to achieve optimal
health and sustainable performance in their personal andprofessional lives.
This year, as part of our ‘whole human’ approach, we haveintroduced a new, proactive program that seeks to move awayfrom the traditional Employee Assistance Program. KPMG
CARE encompasses health, safety and wellbeing aspects into
one service including physical safety and health, mental healthand wellbeing, and domestic and family violence support.

SUSTAINABLE WORKLOAD
Sustainable workload continues to be a priority in our
profession, and a core part of our firm’s approach to providing
a mentally healthy work environment. This year, only 55% of
our people agreed that ‘they are able to sustain the level ofenergy they need to do their work’, up from 53% in our GPS
in 2022. We believe there is still much work to do and we arecommitted to improving our results year-on-year.
While recognising the fast-paced environment in which we
work, we want to ensure that employees thrive, and that thebusiness supports realistic and sustainable work demands.
A new Sustainable Workload Framework and Policy is indevelopment, aimed at ensuring that we practise healthy
ways of working.

Lead with wellbeing
The success of a sustainable wellbeing pilot we ran in 2022
in partnership with Springfox – The Resilience Instituteled to the launch of a full program targeting Directors andPartners this year, called ‘Lead with Wellbeing’. The practical,
high-impact program was designed by bringing together
modern preventative medicine, positive psychology, cognitive
behavioural therapy (CBT) and neuroscience.
‘Lead with Wellbeing’ helps participants in leadership roles
to develop awareness, build healthy habits and practices tostay well, and to support others to do the same. With 555
participants in 2023, 96% agreed or strongly agreed thatthey felt inspired to make positive changes to enhance theirresilience and positive role model wellbeing.

Real Conversations on Mental Health
The Real Conversations on Mental Health program, inpartnership with Heart On My Sleeve (HOMS), has beenrunning for four years, with almost 1,300 participants trained
to date. Since the delivery of the HOMS Real Conversations
on Mental Health program, KPMG has seen an increase in thenumber of people speaking up and leaders listening in – a core
contributor to psychological safety in the workplace.
Internal evaluations this year found that over 85% ofparticipating KPMG people felt their leader supports theirmental health challenges.

Wellbeing Circles
This year, 13 Wellbeing Circles were facilitated by a small groupof Real Peers, people accredited by Heart On My Sleeve, andover 150 people participated throughout the year (20 circles
were facilitated with over 180 participants attending across2022). Wellbeing Circles were originally developed and led by
HOMS, to support our people throughout COVID lockdowns,
and evolved to be led in-house and delivered in a hybrid way.
Themes are developed based on feedback from our people,
our leadership team and from formal surveying across theyear. These sessions are highly sought after and valued for theopportunity to be open, and understanding they are not alone.
Our quantitative evidence shows our Circles have an
overwhelmingly positive influence on our people. 85% ofparticipants strongly agreed or agreed that they felt more
comfortable to reach out and check in on a colleague and
70% of participants strongly agreed or agreed they had been
exposed to new strategies to help them manage their mental
health and wellbeing.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PEOPLE PROGRESSDOMESTIC AND FAMILY VIOLENCE
We continue to examine ways to better recognise and respondto domestic and family violence (DFV). We do this by ensuring
we stay connected to thought leaders and expertise, and our
DFV advisory committee meets bimonthly to track the progressof our DFV program.
Notably, in November 2022, we changed our leave policy toextend our domestic and family violence leave provision from10 days to 20 days of paid leave, in line with leading practice.
Our in-house leadership and peer program ‘Continuing to shine
a light on domestic and family violence’ is an important partof our firmwide wellbeing strategy. This program is designed
to create awareness and understanding of the context ofdomestic and family violence and to enable employees torecognise the warning signs of someone who might beexperiencing it, as well as to provide the knowledge andskills to respond to a disclosure. In 2023, 80 of our leadersparticipated in this DFV literacy program, with 270 of ourpeople trained to date.

SAFETYOur Occupational Health & Safety Management System(OH&SMS) provides a framework to identify, control andmanage OH&S risks and opportunities.​By implementing ourcertified OH&SMS we can address legal, ethical and industrial
relations concerns regarding worker safety and employers’
duty of care.​
KPMG Australia reported 71 work related injuries in 2023,
up from 37 in 2022. The majority were sprains, strains,
bruising and mental health related illnesses.
This year, our Infrastructure, Assets & Places (IAP) division
received external accreditation for ISO 45001 joining
Management Consulting as certified Divisions. This
demonstrates our health and safety management systemprovides a robust and safe system of work for our people.

DOMESTIC AND FAMILY VIOLENCE LEAVEPROVISION INCREASED FROM

10 DAYS
20 DAYS
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OUR PEOPLE PROGRESS

Continuous learning andfuture-ready workforce
OUR COMMITMENT:FOSTER A CONTINUOUS AND FUTURE-FIT LEARNING
AND DEVELOPMENT CULTURE
We want people to thrive and to grow in their own way, inan environment where learning is continuous. Through our
integrated learning ecosystem and access to learning solutions
from our global network, we focus on helping our people
maintain ongoing career relevance while developing leadingedge technical expertise specific to their aspirations, their roleand context. This year, average learning hours per employee
continued to increase to 35 hours, from 33.5 in 2022.

KPMG ECLIPSE ACADEMYThe Eclipse Academy is a multi-year investment in our people
to deliver on our business strategy. The Academy builds critical,
future-focused skills in business areas important to our firm’sand people’s growth, including digital and data, ESG andleadership. Investing in these skills helps our people mobilise
their career and maintain their competitive edge.

The Eclipse Academy also provides recognition of our people’s
skills and experiences with shareable certificates and digitalbadges. This formal acknowledgment, visible on social
platforms such as LinkedIn, elevates our people’s skills sothey become highly visible, portable assets to help maintaincareer relevance. In 2023, 48% of our workforce engaged in
Eclipse experiences.

BUILDING LEADERSHIP CAPABILITY
In alignment with our consistent best-in-class talent andsuccession approach, we have continued to invest in leadershipdevelopment to grow a purpose-led, future-fit, and diverse
community of leaders.
In 2023 our Eclipse Academy Transition Pathways program
reached 2,515 people, providing support as they embarked
on their role with a career development program. With anemphasis on career-enhancing capabilities such as leading
adaptively, creating psychological safety, and leading withvalues and ethics, the pathways enabled successful roletransitions and provided opportunities for participants tocollaborate and build their professional network.
We have also continued to invest in our future talent to ensureongoing leader bench-strength across the firm. Our robust‘high potential’ programs offer targeted development toimprove the readiness of our leaders for more senior andcomplex leadership opportunities locally and globally.

AVERAGE LEARNING HOURS PER EMPLOYEE

35 HOURS
IN 2023up from 33.5 hours in 2022
and 21 hours in 2021

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OUR PEOPLE PROGRESSBUILDING DIGITAL AND DATA CAPABILITY
The Eclipse Academy provided opportunities for our people touplift their digital and data skills so they can better support ourclients. This included digital and data literacy for all our people
with a self-directed learning experience leveraging marketleading video content, contextualised with bespoke client
centric events. This personalised experience offered choiceand flexibility and combined with social learning, reinforced
our learning culture. To date, 11% of our workforce haschosen to participate in this learning offer and we will look tocontinue to grow our people’s participation in the year ahead.

Women in Technology
CASE STUDY

Increasing diversity in
our STEM teams
In the last five years, our Engineering, Assets &Project Delivery (EAPD) Team has grown from 70 to
348 professionals, with the team’s gender diversity
increasing from 13% to 32%. At the same time, thenumber of women in partnership in this team has
grown from zero to 40%. The team also achieved a
graduate intake that was 50% women.
This led to the team being recognised by the AssetManagement Council, the peak body for AssetManagement in Australia, for Excellence in Diversity.
Stan Stavros, Head of Infrastructure, Assets & Places(IAP) said, “We know we have more work to do, but
I am so incredibly proud of the culture our team has
created to have a more inclusive workplace. My learningfrom the journey is the need for representation. You
can have an inclusive culture and leading HR policies,
but without representation in your leadership, ourpeople and clients hold back.”

Through our Women in Technology program ‘IT’s Her Future’,
we are helping to challenge gender barriers in technology,
with 24 KPMG women receiving mentoring from seniorleaders within the business. We also launched a 10-week
Python coding program targeted at women and those who
haven’t had the opportunity to work in technology before,
to increase participation in technology careers. To date, 497
people registered their interest and 120 KPMG people eachweek are participating in this program.

BUILDING ESG CAPACITY
In response to increasing community, investor and market
expectations together with our imperative to embed
Environment, Social & Governance (ESG) in all we do at
KPMG, the Eclipse Academy has deployed the ‘Cambridge
ESG Transformation’ experience to all our people, incollaboration with the Judge Business School at the Universityof Cambridge. This unique learning journey brings together
Cambridge academics, thought leaders, and industry experts
to deliver essential ESG knowledge and tools relevant to theglobal stage.
This year, with the European Business School, we also
launched a new 10-module course for our people actively
working on ESG engagements. This experience, tailored to theAustralian context and aligned to industry sectors, helps ourpeople bring clarity, build trust, and provide critical perspective
when working with our clients to solve their ESG challenges.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PEOPLE PROGRESS

Talent attraction
OUR COMMITMENT:SIMPLER, MORE INCLUSIVE RECRUITMENT PROCESSESTO ATTRACT WORLD-CLASS TALENT
We continue to improve our talent attraction, recruitment andonboarding processes towards achieving our goal of delivering
an exceptional and seamless experience and accessing
new, skilled talent from all walks of life that meet our growthdemands and future skills needs.
Our graduate program attracted 877 people in 2023, up from749 in 2022. We received 19.8% of all Australian graduate
applications in 2022, with the firm awarded three of the top
AFR Grad Connection awards in April 2023.
KPMG Australia launched our ‘Talent Attraction and Recruitment
Reimagined’ program this year to provide a more integrated
and efficient experience and deliver the talent required tosupport our KPMG LEAP strategy. There are four focus areas:• Customised, flexible and scalable talent engagement using
leading technology to reach world-class talent.
• Data and insights in real time to enable more efficientdecisions on sourcing and outcomes.

INCLUSIVE RECRUITMENT
We have continued to broaden our pathways to enter the firm,
addressing the need for a wider skills base and an inclusive
approach to recruitment.
Our new Inclusive Recruitment Program Strategy launchedduring the year seeks to make KPMG an Employer of
Choice for talent from under-represented communities, withaction plans developed to support six talent areas: disability,
veterans/first responders, women in STEM, mature age
workers, First Nations people and skilled refugees.

• Enhanced people experience through higher transparency,
collaboration and reduced administrative burden.
• Flexible and responsive recruitment system andservice that is easy to navigate and meets our firm’schanging needs.

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PlanetSupporting our firm’s, our clients’ and Australia’s transition
to net zeroOUR COMMITMENTS
Decarbonise our operations and supply chain towards net zeroSupport our clients’ and Australia’s transition to net zeroStrengthen climate resilience with our people, clients and community partners
Advance our commitment to circularity
Understand and improve our impact on nature and biodiversity©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR PLANET PROGRESS
Climate change
and environmental
sustainability

As a significant provider of ESG services, KPMG Australia has
a responsibility to look at the impact of our own operations
and supply chain and to play our part in global decarbonisation
efforts. Our new CAP 2023–2030 recognises the critical needto continue our own decarbonisation journey beyond ouroperations and into our supply chain and to support our clients,
our economy and our communities’ net zero transition andclimate resilience.

We are committed to decarbonising our operations and supply
chain whilst supporting our clients and Australia’s transition
towards net zero. We continue to collaborate and advocate
alongside our people, clients, alliance partners, community
organisations and NGOs to build a more sustainable andresilient future.

Our Environmental Policy and Environmental Statement werereviewed and updated this year in light of updates to our new
CAP 2023–2030.

KPMG AUSTRALIA CLIMATE ACTION PLAN 2030
In April this year, we released our new Climate Action Plan
(CAP) 2023–2030, developed in consultation with our people,
KPMG’s subject matter experts and leading non-governmentalorganisations (NGOs). The CAP 2023–2030 builds on ourinaugural Climate Action Plan (CAP) 2018–2022 and includes
new and ambitious targets, actions and initiatives supporting
Australia’s transition to a net zero future.

-43%
CHANGE IN GROSS SCOPE 1, 2 & 3 EMISSIONS
against our 2019 baseline

DECARBONISATIONOUR COMMITMENT: DECARBONISE OUR OPERATIONSAND SUPPLY CHAIN TOWARDS NET ZEROAt a global level, KPMG International has committed toachieving net zero carbon by 2030, based on a 1.5°C Science
Based Target. The target has been validated by the Science
Based Targets initiative (SBTi).
To meet this objective, KPMG Australia must achieve a 50%
reduction of our greenhouse gas (GHG) emissions by 2030 (ona 2019 baseline), across our Scope 1, 2 and 3 emissions. This
includes business travel and purchased goods and services.
While we continue to be on track towards meeting thisoverarching target, having this year achieved a 43% reduction
against our 2019 baseline, our gross absolute emissions
increased by 160% from last year, predominantly driven bylarger volumes of business travel post-pandemic.
Energy emissions from KPMG offices went down by 59%
due to our Renewable Energy Supply Agreement, and energy
emissions attributed to our people working from home also
decreased by 18% due to greater occupancy of our offices
throughout the year.
We continue to maintain Climate Active certification on
our carbon neutral claim and source 100% renewableenergy for KPMG tenancies through our Renewable
Energy Supply Agreement.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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OUR PLANET PROGRESS

INTERNAL PRICE ON CARBON
Our Internal Price on Carbon (IPC), launched last year and whichplaces a fee on our air travel emissions anchored to the market
price for Australian Carbon Credit Units (ACCUs), is continuing
to help us raise visibility of the impact of our collective air travel
as we closely monitor progress against our 50% emissions
reduction target.
Over the last 12 months, we generated $250,000 from IPC
payments from each of our divisions, which have been invested
into carbon removal initiatives focused on reforestation andrestoration of natural habitats in Australia.
Although we have achieved an absolute reduction of 47% for
our business air travel emissions from our 2019 baseline year,
these emissions increased considerably since last year, with
our people resuming air travel after a lengthy Covid-driven
hiatus. As a result, our NEC issued an updated Travel Policy
in March 2023 with a new and stricter approvals process forinternational travel and non-client work travel, to help ensure
we do not return to pre-pandemic peak travel levels.

Progress in the past year included working with our suppliers,
subject matter experts and our people to:• Host our first net zero workshop in June, aimed atbuilding our suppliers’ capabilities to set and validate
science-based targets and report carbon performance:
10 suppliers participated, learning from our Climate
Change & Sustainability Services client team and supply
chain partners including Avarni.
• Use the Avarni carbon accounting and emissions
management platform to improve our supply chain reporting
through supplier engagement questionnaires and to trackclimate risk in our highest emissions supplier categories
through a visual dashboard using Microsoft Power BI.

A STRONGER FOCUS ON DECARBONISING OUR
SUPPLY CHAIN
Our new CAP 2023–2030 has a much stronger focus on our
supply chain – setting a target that 80% of our suppliers (byspend) must have a Science Based Targets initiative (SBTi)or equivalent carbon reduction target by 2025. As of 30 June
2023, 73 of our suppliers (40% by spend) had met
this requirement.
We are making good progress in implementing the Sustainable
Procurement Framework we launched last year by working
closely with suppliers large and small and playing an active rolein helping them reduce their Scope 3 emissions.

As of 30 June 2023

73

OF OUR SUPPLIERS(40% BY SPEND)HAD CARBON
REDUCTION TARGETS
80% target by 2025

CASE STUDY

BrewHub: coffee with impact
BrewHub is an Australian owned medium sized businessthat supplies all our offices with high quality coffee
machines, beans, milk, and pantry supplies. Four years ago,in collaboration with KPMG, they developed a new coffee
blend called BrewGooder. This year, the blend generated$32,000 which has been donated to the Indigenous
Futures Foundation.
From an environmental perspective, BrewHub has worked
with KPMG to do the following:• Set carbon reduction targets in line with Science Based
Targets to deliver by 2030.
• Conduct carbon audits to Australian Standards andfeeding those results through to Avarni to help capture
our Tier 3 impact.
• Determine the emissions intensity of its activities per
coffee machine.
• Power its main warehouse with 100% solar power– and is working towards renewable power forremaining warehouses.
• Install fast-charging stations for electric vehicles.
“KPMG made a number of practical recommendations to
reduce our emissions while making our operations more
efficient and sustainable, which we implemented,” said
David Scott, Managing Director, BrewHub.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PLANET PROGRESSSUPPORTING INNOVATIVE ECO STARTUPSThe KPMG Nature Positive Challenge
Our investment in emerging sustainable technology andenterprise through our work with eco-ventures has continued
as we launched the second year of the KPMG Nature Positive
Challenge in April 2023. The Challenge supports innovative
ventures that help accelerate positive outcomes for nature andbiodiversity. This year we expanded the Challenge to include Fijiand Papua New Guinea and called for Expressions of Interest
with a focus on:• Biodiversity: accelerating the protection, preservation,and regeneration of all species and living things on Earth.
• Blue Economy: encouraging the sustainable use of marine
resources for economic growth and community prosperity,
while preserving the health of the blue ecosystem.
Sydney-based Xylo Systems won our Nature Positive Prizeof $100,000 for their cloud-based data and AI platform that
supports organisations – such as property developers andenergy companies – measure and manage their footprint andbiodiversity impact in line with the guidelines of the Taskforce
on Nature-related Financial Disclosures (TNFD).

We continued to work alongside the ventures from last year’s
Nature Positive Challenge and to grow the volume of client
work we are doing with eco startups. We have also formeda partnership with Climate Salad, a network to boost climate
tech companies and entrepreneurs, as they grow their teams,
get customers and connect with investors.

CLIMATE RISKOUR COMMITMENT:SUPPORT OUR CLIENTS AND AUSTRALIA’S TRANSITIONTOWARDS NET ZERO
This year, and for the first time, KPMG Australia made aformal commitment to support and accelerate our clients’and Australia’s transition to net zero. We believe that wehave a unique opportunity to leverage the breadth of ourcore capabilities and service offerings to support organisations– from innovative startups to large multinational companies –to innovate, transform their business and grow more sustainably.

DECARBONISATION AS A CLIENT FOCUS
KPMG Australia continues to progress towards our vision
to be a leader in sustainable decarbonisation pathways,
supporting deep transformational change in the private
and public sector to achieve net zero.
This year has seen the launch of our new Decarbonisation
proposition, bringing together the services and associatedsolutions we offer to proactively support clients in theirtransition journey. The Prosperity section provides further
information on our ESG ambition and practical examplesof our work and thought leadership in this space.

Xylo Systems CEO & Co-founder Camille Goldstone-Henry (right) andCo-founder & CTO Jada Andersen (left)

PNG-based Cooperative Advantage Alliance, a women-led
organisation focusing on enabling landowners to establish
sustainable fishing practices and crop management
techniques was voted by KPMG employees for our inaugural$50,000 People’s Choice prize. The two ventures, alongside
three other startups selected by our judging panel – Hullbot,
Restore Blue and Wilderlands – will share an expanded poolof tailored advisory support worth $250,000.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PLANET PROGRESSCASE STUDY

Agronomeye – an AgTwin for
nature positive outcomes
KPMG 2022 Nature Positive Challenge finalist Agronomeye
have created a digital twin for agriculture that provides
real-time virtual representations of farming land based on
science and data.
The AgTwin platform helps inform smart land management
practices and generate improved outcomes such as farm
productivity, biodiversity, water efficiency, animal welfare
and carbon emissions. Importantly, the platform brings
science, data and transparency to help farmers legitimise
their Nature Positive and ESG credentials.
KPMG has been working alongside Agronomeye todevelop and implement a nature positive merino offeringin partnership with local farmers in the Midlands region of
Tasmania. This historic farming area consistently producessome of the finest merino wool in the world and wasmanaged productively for 40,000 years by Tasmania’sFirst Nations people. The region is also one of Australia’s
biodiversity hotspots.
Using best practice ESG frameworks, KPMG is helping
measure the impact of farmers that are using theAgronomeye platform to help restore the landscapeson which they farm while maximising their production
and achieving higher wool prices for a premium, moresustainable product. Together, they are finding it useful tobe able to use data, science and transparency to support
their on-ground performance and management, and createa meaningful narrative and connection for consumers
to participate in regeneration through their purchases
and support.
Early impacts of the Agronomeye technology include
the identification of endangered species habitats (suchas Wedge-tailed Eagles), improved planning for efficient
farm design and developments (including vineyard andlandscape rehydration/erosion projects) and reporting on
factors such as animal welfare to help meet increasing
supply chain demands.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PLANET PROGRESS

Monitoring the carbon intensity of our client portfolio
We also have a responsibility to manage our own client portfolio
in a way that aligns with our Values and understands how it isevolving towards a low carbon future. We continue to monitor
and report on carbon emissions generated through our client
portfolio for every dollar of revenue we generate each year.
As disclosed last year, in the absence of an existing industry
methodology, we developed a new innovative method toestimate our client-related emissions, which we continued
to refine this year (noting that the data is one year in arrears
due to availability, which is consistent with emerging industry
accepted practice).
For FY22 we have estimated that our client-related emissions
for every dollar of revenue generated was 0.181kg26 (anincrease on 0.106kg in FY21). The increase in emission intensity
is mainly driven by change in our client portfolio, with morework having been undertaken for the energy and utilities sector.
We are now trying to understand more about the natureof the services provided to these clients – whether they
are positive, neutral or negative to the decarbonisationof Australia’s economy – and determine implications
for managing future engagements. A summary of our
methodology is included in our Databook.
This year, we also started monitoring the percentage of ourASX 200-listed clients who have publicly set Science Basednet zero targets, and we found that:• 32% of our clients have set Science Based Targets initiative(SBTi) approved targets.
• 57% have set net zero targets that have not been publicly
approved or validated by the SBTi.
• 11% have no publicly set targets.

CARBON INTENSITY OF OUR CLIENT PORTFOLIO

0.181kg

We are continuing to monitor and refine these estimates andtargets and will use it in the future to identify and manage
our climate-related risks and the exposures that emerge
as the economy decarbonises in line with Australia’s
decarbonisation goals.

26

26

of CO2 emissions per dollar of revenue
generated in FY22
from 0.106kg in FY21

This figure has been updated following a transcription error.

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OUR PLANET PROGRESSOUR COMMITMENT:STRENGTHEN CLIMATE RESILIENCE WITH OUR PEOPLE,
CLIENTS AND COMMUNITY PARTNERS

This year, KPMG International also became a founding memberof the Alliance for a Just Energy Transformation (AJET),
announced at COP27 by the United Nations Development
Programme (UNDP) and World Wide Fund for Nature (WWF).

Our Climate Action Plan (CAP) 2023–2030 aims to amplify
our people’s knowledge on climate action, and collaborate
with clients and community partners to strengthen climate
resilience. This year, through our Climate Action Survey, 61% ofparticipants told us they believe KPMG fosters environmentallyfriendly practices – consistent with 2022 results. There is morework to do to raise awareness of our new CAP 2023–2030 andto engage our people in climate and sustainability initiatives.

AJET is a voluntary initiative that intends to mobilise
stakeholders including communities, civil society, policymakers,
and the private sector to drive the successful implementationof just energy transition policies worldwide. This involves
understanding the needs of those currently engaged in fossil
fuel supply chains and services as they transition to renewableenergy alternatives.

EMPOWERING OUR PEOPLE TO ACT ON CLIMATE
We believe everyone at KPMG Australia has a role to playin the transition to net zero. To help us, we have set a newtarget that half of our workforce will participate in climaterelated engagements and initiatives by 2030. This can be
through completing specialised training, delivering relevant
thought leadership, or through direct participation in a range
of environmental initiatives. We expect to start reporting
progress on our people’s participation from 2024.

Climate and sustainability initiatives
This year, over 290 people volunteered over 2,000 hours withenvironmental community partners and NGOs, supporting SDG
13 (Climate Action), SDG 14 (Life Below Water) and SDG 15(Life on Land).
For example, with Landcare Australia, we helped establish over
5,300 native plants and remove noxious weeds by hand over
4,500 square metres of land.
In the past 12 months, our Green Champions Network has
been actively engaging and connecting through Yammer –where our people shared stories of sustainability in action,
worked together to develop educational materials and sharedtips around recycling, renewable energy and low carbon
and sustainable living. Over 435 KPMG people from acrossAustralia, PNG and Fiji are now members of this Network.
Through our ESG Activation series, a learning program
launched last year to upskill our people on ESG, wedelivered climate literacy sessions covering everything fromcontemporary sustainability frameworks to climate change
science, greenwashing and climate risks and opportunities.

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OUR PLANET PROGRESSOUR COMMITMENT:ADVANCE OUR COMMITMENT TO CIRCULARITY
Our 90% waste to landfill target was not met as part of ourprevious CAP 2018–2022, and disappointingly in the past
year we only reached a 71% recycling rate. We continue towork towards progressing against this target across KPMG
tenancies, through education and behaviour change, butthere is more work to do.
We remain challenged by cross-contamination of our officewaste, so where waste data is not available, KPMG Australia
tenancies will be audited on waste and recycling rates, to help
us achieve a 20% reduction in office waste to landfill by 2025.
As part of our CAP 2023–2030, we have committed to
implementing new measures to ensure more raw materials arebeing reused and recycled by 2030. To do this, we will performa baseline assessment of our circularity performance. We will
also require all major suppliers of purchased goods to have to
set waste, packaging or circularity targets by 2025.
We continue to work closely with our suppliers of purchased
goods, including furniture, IT and office suppliers and catering
to minimise waste. For example, KPMG use Lenovo as atechnology provider, utilising its Device-as-a-Service (DaaS)
offering which allows us to use the equipment for three years,
before returning it to Lenovo who then reuses or recycles theequipment, ensuring e-waste is kept out of landfill.

CASE STUDY

Project Re-use: office fit-outs
with circularity in mind
Office relocations and new office fit-outs are an
opportunity to minimise waste, by ensuring that there-use of fittings and fixtures is a priority. Over the
past 12 months, through our new Parramatta andGeelong offices and renovations across Hobart andMelbourne, our teams have repurposed furnitureand re-used equipment.
•

Parramatta: 43% office chairs re-used; 100%of tables relocated to the new office.

•

Melbourne: 100% of chairs, desktop fit-out
equipment and workstations re-used, and100 personal lockers dismantled and relocated.

• Eliminating the use of single use plastic in our in-housecatering and hospitality services across the country.

•• Establishing the ReGround partnership in Melbourne
office to help recycle more than 2,100kg of coffee
grounds, which are delivered to community gardens
and local gardeners.

Hobart: 100% of office and meeting room
chairs re-used, 50% of desktop fit-out and 40%of meeting room tables re-used, and 55% of
personal lockers relocated.

•

Geelong: 74% of office chairs and 54% of meetingroom chairs re-used, 25% of meeting room
tables relocated.

Progress on circularity in the last 12 months included:• Implementing Project Re-use to minimise waste across
our office fit-outs (see case study).

Next year, we will continue to see more streams ofrecycling introduced and better waste data acrossour tenancies.

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OUR PLANET PROGRESS

NATURE AND BIODIVERSITYOUR COMMITMENT:UNDERSTAND AND IMPROVE OUR IMPACT ON
NATURE AND BIODIVERSITY
Taskforce on Nature-related Financial Disclosures
In 2023, KPMG operated four tenancies in or adjacent (within
5 km) to key biodiversity areas, including Canberra, Hobart,
Perth and Penrith offices (which closed in August 2022).
Similarly, KPMG offices in Adelaide and Port Moresby (PNG)
were identified as operating in regions with medium-highwater stress.
KPMG International has been actively involved in the new
Taskforce on Nature-related Financial Disclosures (TNFD)
expected to come into force in late 2023 and has this year
implemented a biodiversity plan as part of our global journey
toward a nature positive future, which includes our operations
and office footprint, our supply chain and our work for clients.
KPMG Australia’s Natural Capital & Biodiversity National Lead
represents our global firm as a Member on the Taskforce.
KPMG is also a member of the Responsible Investment
Association Australasia (RIAA) Nature Working Group,
an initiative to support financial services, asset owners
and managers in their stewardship responsibilities toprotect nature and biodiversity in their business
operations and portfolios.

Funding pilots to support reforestation and natural
habitat restoration
This year, we started a partnership with AirSeed – a finalist in
our 2022 Nature Positive Challenge – to help finance a pilot
restoration project to plant 50,000 seed pods in Australia.
AirSeed will provide monitoring data allowing us to track
the total area restored, the species planted and to better
understand how to achieve stronger restoration outcomes.
This pilot project will also provide direct opportunities forour people to engage with the seed pod production andplanting process.
KPMG Australia has commenced a new partnership with
WWF-Australia to support ‘Koala Friendly Carbon’, an initiativein collaboration with Climate Friendly. This is a first-of-its-kindcarbon project that aims to restore tens of thousands ofhectares of high abundance koala habitat in eastern partsof Australia.

Through our CAP 2023–2030, we have outlined new andambitious measures to support nature positive outcomes,
complementing our investment in innovative ventures throughthe KPMG Nature Positive Challenge, including:• Adopting a zero-deforestation policy in 2023 and engaging
with major suppliers to adopt the policy by 2025.
• Commissioning an Integrated Biodiversity Assessment(IBAT) to understand our impact on biodiversity, protectedareas, threatened species and critical habitats across
KPMG Australia’s national office footprint.

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Prosperity
Making a positive social and economic impact

OUR COMMITMENTS
Strong economic contribution
Exceptional client outcomes through work that matters
Build a thriving technology business and innovate with our clients, alliance partners
and the startup ecosystem
Create a fairer, more inclusive and more sustainable future for our communities
Advocate on the issues that matter©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESS
Purposeful growth

Impact of ourclient work
This year we’ve made progress in unlocking our organisation’scontribution towards economic and social prosperity, inline with the UN Sustainable Development Goals (SDGs).
This means we strive to create meaningful employment
opportunities; we generate wealth and contribute to theeconomy and regional development through growing ourbusiness and paying taxes; we provide services to clients to
help them drive sustainability; and we invest in creating fairer,
more inclusive and more sustainable communities.

OUR COMMITMENT: STRONG ECONOMIC CONTRIBUTIONGROWING OUR PRESENCEKPMG Fiji – which currently services seven Pacific Island
nations – relocated its Nadi office to new modern premises
with strong sustainability features, designed by a leading
Fijian architecture firm.
We have also continued to grow our regional presence inAustralia by opening a new office in Geelong; relocating ourGreater Western Sydney office to new and larger premises in
Parramatta; and refurbished our Hobart office to support thegrowth of our practice in Tasmania.
This year, KPMG also completed two acquisitions:• Fiji-based digital enterprise solutions provider Acton,
broadening the delivery of Microsoft solutions to our
mid-market clients in Australia and the South Pacific.
• Adelaide-headquartered Think180, expanding our firm’s
SAP capabilities to create a leading SAP Intelligent andEnterprise Asset Management specialist team.

EMPLOYMENTAs a professional services firm, we are a people business first –from the graduates and early career professionals who join andgrow with us, to the leaders that bring a wealth of experience
to our teams across Australia, PNG and Fiji, to our alumni in the
broader business community.
At 30 June 2023, the firm employed 10,173 people27 acrossAustralia, Fiji and PNG – 353 of which were employed in theSouth Pacific Practice, up from 266 the previous year.
In FY23, 877 graduates were hired, up from 749 in 2022.
Almost 60 of these were in PNG and Fiji.
KPMG Australia also appointed 96 new partners and executive
directors during the year, increasing the partnership to 713 (upfrom 673 in 2022). Of our new partners, 43% are women and
18% identify as culturally diverse.
Please refer to our Databook for more information about
our People.

27

Includes full-time, part-time and casual employees in Australia, Fiji and PNG.
Excludes partners and contingent workers.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSKPMG AUSTRALIA FINANCIAL RESULTS

Economic contribution

KPMG Australia posted revenue of $2.553 billion for the year
ending 30 June 2023, representing year-on-year (yoy) growthof 9.1%.

A$bn

FY23

Total revenue$2.55326 $2.341

9.1%

Recoverable expenses$0.175$0.161

8.7%

Revenue$2.378$2.179

9.1%

26

FY22

GROWTH %Includes PNG and Fiji for FY23: ($0.033bn for FY23)

The FY23 performance across the firm’s divisions reflected
uncertain economic conditions and a constrained consulting
environment. Audit, Assurance & Risk Consulting revenues
grew by 4% ($671 million); Deals, Tax & Legal revenues
were down by 2% ($401 million); Enterprise was up by
23% ($361 million); Infrastructure, Assets & Places was
up by 22% ($200 million); and Management Consulting
was up by 12% ($745 million).
KPMG also invested significantly in developing the businessfor future growth, with AI experimentation a highlight.
KPMG CEO Andrew Yates said: “Given the challenging
economic environment, I’m pleased to report a solid financial
result, reflecting the dedication of our talented people andpartners. The environment reminds us that we need to double
down on core priorities – delivering high-quality work, providing
a great people experience, generating returns responsibly,and continuing to grow at a healthy rate to allow us to invest
for the future.”“Coming off strong growth in FY22, we maintained revenue
momentum until December. Then there was a noticeable shift,with client activity and revenue slowing. While our revenue
increased year on year, the slowdown resulted in equity partner
incomes decreasing by 3.9% on the prior year.”“To reflect the new landscape, we have had to adjust ourbusiness. Most recently, I announced the introduction of anew operating model, partly to address the reality of the newenvironment but also to ensure better alignment with theglobal firm.”$2.553
10,173713$815

BILLION REVENUE(up 9.1%)

PEOPLE
including 877 graduates (up 17%)

PARTNERS AND EXECUTIVE DIRECTORS(up 6%) – including 96 new partners

MILLION TAXES PAID
(up 18%)Opened new office Relocated Parramattain Geelong
and Nadi offices

2 BUSINESS ACQUISITIONSACTON, THINK180
Investment
Technology and innovation
KPMG continued to develop capabilities for the firm, employees
and clients, leveraging emerging technologies and investingin cutting-edge research and startups to help tackle complex
business challenges.
Engagement with AI was a standout achievement for the year.
In March 2023, KPMG became one of a handful of companies
in the world to be given access to a private version of ChatGPT– known as KymChat. The solution is directly integrated with
Microsoft Teams and allows people to safely use ChatGPT’s
groundbreaking technology in the workplace. In July 2023,
KPMG launched an offering for clients that combines thisworld-class technology with bespoke AI consulting services.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESS
Following successful pilot programs in the US, UK and
Canada, KPMG Australia also began using new AI audit
technology on a small number of companies. Powered by the
integration of MindBridge financial risk discovery technology
with the KPMG Clara smart audit platform, there are plansto roll out the technology to around 200 audit engagementsin the coming year. This will be a major investment for theAustralian audit practice and a significant development inaudit accuracy and efficiency.
The KPMG Futures team’s focus was dedicated to Next
Generation Internet, quantum and next gen AI – the areas
the firm believes will have the greatest impact on itself
and clients. The inaugural Head of Metaverse Futures wasappointed, a first in the industry, and a specialist team now
offers a unique approach to growth and innovation using
metaverse technologies and is designing new businessmodels for the firm.
KPMG Eclipse Academy
The Eclipse Academy is a multi-year investment in employees
to deliver on the firm’s business strategy. The Academy builds
critical, future-focused skills in business areas important toour firm’s and people’s growth including digital and data, ESG
and leadership. In its first full year of operation, the Academy
focused investment on leadership development, building digitaland data capability, and ESG capacity.

OutlookAndrew Yates commented: “We live in a time of acceleratingchange – an evolving market, an industry in a state of
disruption, heightened expectations and economic uncertainty.
Our outlook for FY24 is therefore cautious, but optimistic. We
have great people, with an innovative spirit. We’ll ensure thebusiness is efficient, with a focus on growing responsibly.”“With intense scrutiny on professional services firms, andwith the sector confronted by questions about trust andintegrity, KPMG will continue doing whatever we can to
improve independently. But there is scope for more significant
advancement if the profession moves together throughsensible sector-wide reform and increased transparencyof the way we work. We’re hopeful our industry can work
co-operatively with the inquiries and with governments
to produce practical enhancements on regulation thatstrengthen the sector and benefit the community.”

New operating model for FY24
On 5 June 2023, Andrew Yates announced changes tothe firm’s operating model and leadership, effective from
1 July 2023. Key drivers for the changes are better global
firm alignment; removal of internal structural barriers; andimproved strategy execution. The changes are timely given
market issues as the firm maintains a sharp focus onbuilding trust in the profession.
From 1 July 2023, the client-facing divisions of the firm will be
as follows. In future, reporting will adjust to align to these.
Audit & Assurance
Consulting (combining Management Consulting and
Risk Consulting)
Deal Advisory & InfrastructureEnterprise
Tax & Legal

Tax paid
We have a responsible approach to tax, strong governanceand policies, and are committed to transparency around tax.
KPMG has a global policy to set the standard and expectations
around member firm and partner tax affairs. There are also risk
management practices in place to help ensure that tax affairs
have been conducted in accordance with the relevant local laws
and regulations and in harmony with global tax principles.
Total taxes paid by the Australian firm, its partners andemployees on income generated from the firm totalled$815 million in 2023 (up from $690 million in 2022). This
included goods and services tax, fringe benefits tax, payrolltax, tax deducted from employee salaries, and tax payableby partners on income generated.
Partners paid on average an effective tax rate on profits
of 40.3%.
We did not receive any financial support from any government
during the year.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSOUR COMMITMENT:
EXCEPTIONAL CLIENT OUTCOMES, THROUGH WORKTHAT MATTERS
This year, we have continued to invest in areas that mattermost to our clients and through which the firm can deliver
exceptional and purpose-driven client outcomes.
As part of delivering to our KPMG LEAP strategy, we arelistening to our clients and anticipating their needs, creating
tailored client experiences and solutions through both digitaland face-to-face channels. Our client satisfaction metric was
8.7 (out of 10), a strong result consistent with last year.

High quality client service
KPMG Australia achieved ISO 9001 certification, aninternationally recognised standard that sets the criteria for
quality management and helps organisations ensure they
consistently meet customer and regulatory requirements.
Being ISO 9001 certified demonstrates our commitment
to continuous improvement and to adopting innovative
approaches and best practices throughout our operations.
The certification has been expanded this year to include
Fiji and PNG, in addition to Management Consulting (MC),Infrastructure, Assets & Places (IAP), Connect Technology
Group (CTG) and Business Services divisions. In 2023 we also
launched our new Operational Risk & Resilience Centre of
Excellence, dedicated to enhancing client trust and satisfaction
through identifying, managing and mitigating operational risks.
It enables and ensures compliance with regulations and thefirm’s operational ISO programs.

Economic contribution

8.7

CLIENT SATISFACTION SCORE(OUT OF 10)
consistent with 2022 results

WORK THAT MATTERS ACROSS OUR FIRM
Across our divisions, our people have continued to work
alongside our clients to support their needs, their sustainablegrowth, and to make a significant positive contribution
to prosperity.
In our Audit, Assurance & Risk Consulting practice, we’ve
worked with clients to understand and manage their risks andestablish safeguards against rising and emerging issues suchas cyber threats and geopolitical shifts. We have continued toenhance the integrity, transparency and reliability of clients’financial and ESG information which markets rely on, helping
to preserve confidence. KPMG is also the financial statement
auditor for approximately 19% of the ASX 200 companies.
The Deals, Tax & Legal practice has helped organisations meettheir regulatory obligations, navigate and comply with complex
and constantly evolving tax and legal landscapes and provide
commercial insights to unlock stakeholder and investor value.
Our Enterprise practice continued to provide services to midmarket companies, family businesses, regional businesses
and Indigenous enterprise, tailoring local solutions to meetthe needs of our clients and to deliver beneficial outcomesfor regional economies and employment.
The Infrastructure, Assets & Places division has engaged withsome of the largest infrastructure projects in the nation bybringing together technical, financial, and strategic experts
to activate critical infrastructure and community facilities thatprovide a sense of place.
Our Management Consulting team has worked alongsideorganisations to navigate their transformation journeys, deliveron their promise to customers and employees, and leverage
new technology and cloud-based solutions to solve complex
and evolving problems across industries.
We work with over 15,000 clients each year. Here are a few
case studies to provide some insights into our daily work andhow we can bring to life the confidence and positive change
we make with our clients and our community.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSCASE STUDY

Helping the Australian Red Cross continue to serve communities
experiencing vulnerability
The Australian Red Cross has been central to the fabric of Australian society since its creation over 100 years ago. Through its
network of 20,000+ staff, members and volunteers, the Australian Red Cross delivers expertise in emergency services and disasters,
migration, community programs, international conflicts, and humanitarian law.
In FY23 Australian Red Cross partnered with KPMG Australia, which deployed over 120 team members to help rapidly transform
multiple aspects of their organisation. At the heart of the transformation was the pursuit of purpose, a collective focus to enable
the Australian Red Cross to make an even more significant impact, for the long term.
KPMG and Australian Red Cross Executive team members jointly led the organisation through a complex transformation process,which focused the scope of activities on Australian Red Cross’ core areas of expertise and re-engineered systems and processes
so they are more efficient and effective. As the lead transformation partner, KPMG’s support has assisted the Client Management
Team to:•Prepare and seek Board endorsement of the Transformation Roadmap, including the release of project funding.

•

Provide clear direction to the organisation on the future vision and a roadmap to achieve a ~$45m EBITDA turnaround in
18-24 months.

•

Design the organisation, technology, process and governance in line with better practice, to reduce operating risk andimprove efficiency.

•

Govern and co-ordinate delivery across a complex program of work, reducing implementation risk.

•

Reduce implementation risk by leveraging KPMG’s Powered transformation approach, tools and templates.

Ultimately, this will enable the Australian Red Cross and its 20,000+ volunteers, members and staff to execute on its strategy
and sustainably continue to impact the lives of Australians by providing critical services to the community, which last year
reached 131,000 Australians.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

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Helping Homes Victoria meet the unique needs of people livingwith mental illness
Homes Victoria and the Department of Health are implementing a suite of reforms in response to recommendations from theRoyal Commission into Victoria’s Mental Health System. One of the priorities was to increase the allocation of social housing toVictorians living with mental illness.
KPMG Australia was called upon to work with Homes Victoria on their housing reform program, co-designing the social housing
and support model for Victorians living with mental illness. Over five months, our team led an iterative program to co-design
supported housing principles with people with a lived and living experience of mental illness and unstable housing to ensure thatthe composition, design and support provided meets the unique needs of the people who will live in them.
We partnered with a range of specialists in the design and facilitation of the co-design process including facilitators from
Mental Health Victoria as well as a panel of ‘critical friends’ with lived experience who helped shape the approach, analysis andrecommendations throughout. Our participants included Aboriginal Victorians, people from culturally and linguistically diverse
backgrounds, LGBTIQ+ community members, people from regional areas of Victoria, and people from different age groups –ensuring the design was informed by the needs of a diverse range of people and whose voices are often unheard.
We also engaged with carers and service providers in the mental health sector, and housing agencies, exploring their insights
and recommendations and considered how they may be able to collaborate to provide better support to people living in thehomes. Importantly, we helped to define the likely range of homes and their design features that would better meet the needsof people living with mental illness, to support their procurement. We also provided guidance on the sorts of support andservices that should accompany those homes, and how housing and support service providers can collaborate to improveoutcomes for people living in the homes.
Homes Victoria has used this work to inform the development of 2,000 homes for adult Victorians living with an acute mental
illness who are in unstable housing and require intensive, ongoing treatment, care and support. Our work has revealed theopportunities and advantages of a co-design approach, which Homes Victoria and other agencies will be able to draw on or

replicate in future to gain similar benefits.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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Waterloo Renewal Project: improving
housing outcomes for the community
KPMG Australia is supporting the NSW Government on the renewal of
the Waterloo Estate in Sydney, the state’s largest and most complex
social housing urban renewal project.
The 19-hectare Waterloo Estate is located approximately 3 km south of Sydney’s CBD and is currently the largest social housing
estate in Australia, accommodating approximately 2,000 social dwellings. The homes on the site are now nearing the end of their life
with opportunities to provide improved outcomes for residents through diversity of housing, an increased focus on place-making andinitiatives that provide sustainable improvements in socio-economic outcomes for residents.
Since early 2022, KPMG has worked with NSW Land and Housing Corporation (LAHC) to carry out a market sounding exercise,following detailed consultation with a diverse range of stakeholders including developers and community housing providers. We
are currently engaged in the procurement phase request for proposals (RFP) Stage 1 where we are providing commercial advisory
and transaction management services. Our role in the market sounding and during RFP Stage 1 has helped inform and shape theprocurement and commercial transaction process to secure a long-term delivery partner for the project.
The Waterloo Renewal Project is of great significance to the local community – our involvement in this unique and complex
redevelopment project is helping the NSW Government deliver lasting positive social and economic wellbeing for residents and thedelivery of around 3,000 new homes comprising of social, affordable and private housing, as well as new public spaces and facilities.

CASE STUDY

Developing a mobile app to help children get
to school safely
KPMG partnered with the NSW Department of Education to develop a mobile
app for the Assisted School Travel Program (ASTP).
The ASTP provides a free, specialised transport service for eligible students livingwith a disability to help them get to and from school across New South Wales.
The mobile app enhances the safety and security of these students by providing
transparency on their movement through the transportation of authorised
destinations and validation that students have safely exited the vehicle.
The previous process involved emailing or printing run manifests which did
not provide adequate assurance and visibility over where the children were
getting on and off the vehicles. The digital app and operational dashboard,developed by KPMG, uses real-time technology and GPS to track the vehicles
to show where they are at any given moment – if there are delays due totraffic or an on-road incident, the Department is alerted and is able to takeaction accordingly. The ASTP Staff are able to view each route and identify
who is onboard and their location at any point in time.
During the trial phase, in the first half of 2023, over 100 students and theirparents benefited daily from this mobile app.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSDELIVERING OUR ESG AMBITIONHELPING CLIENTS WITH ESG

Supporting organisations to achieve their own ESG goals is
integral to the impact of our work. Our clients expect us toprovide them with timely insights, tools and capabilities to help
them respond to the environmental, social and governancerisks and impacts associated with their business. Clients also
look to us to anticipate market shifts and evolving stakeholder
expectations around ESG to help transform their business andmanage their transition towards net zero.

In April this year, through our new Climate Action Plan (CAP)
2023–2030, we made a commitment to supporting andaccelerating our clients’ unique decarbonisation journeys –including those in carbon-intensive industries.

This year, we have continued to embed ESG as the watermark
that runs through our business, with each of our divisions
actively engaged in helping clients progress and accelerate
their ESG journeys. We’ve also actively encouraged our people
at all levels to participate in ESG learning and upskilling to stay
across the latest developments.

UPSKILLING OUR CAPABILITIES ON ESG
To support informed and impactful client conversations in a fastmoving landscape, our ESG Activation series offered our people
a firm-wide program of learning, interactive sessions, videos
and articles across a wide range of ESG topics, from ESG
Foundations through to specialised training such as Climate
Risk, ESG in the Supply Chain and Operationalising the ESG
Agenda. This year, 1,660 people have attended various sessions
across this series.
The ESG activation series complements our global flagship ESG
program with the Judge Business School at the University ofCambridge and our new 10-module course with the European
Business School.

CONTRIBUTING TO ESG THOUGHT LEADERSHIPWe also continue to produce thought leadership and insights to
help strengthen awareness and understanding of the building
blocks for a climate-resilient economy and society.
Key reports published in 2023 include:• Big shifts, small steps. Global-Survey-of-SustainabilityReporting

Acknowledging that the transition to net zero can be a longand complex process, we launched our new Decarbonisation
Proposition in the same month. This proposition brings
together our existing cross-firm advisory and assurance
capabilities – including our expertise spanning climate change
and sustainability, reporting, data and analytics, economics,
infrastructure and engineering, human rights and governance –to help our clients plan for a just and sustainable transition
to net zero.
Over the past 12 months, our work has focused on two priorities:• Transforming organisations to enable progress across
key stages of their transition to net zero – understanding
their existing level of maturity, considering the risks to
climate and nature from their industry, their business andoperating model and assessing the people, social andeconomic impacts of their decarbonisation journey.
• Reporting on ESG performance against commitments
and meeting disclosure requirements – ensuring ESG
performance information is timely, transparent and reliable
to inform stakeholders and their decisions.
We have also seen growing demand for ESG due diligence thisyear and have assessed approximately over $900 million oftransactions, looking at companies’ ESG risks and complianceto help inform investments, acquisitions and other deals.
The impact of our work also extends beyond individual client
engagements through the delivery of community engagement
and consultation to help inform the decarbonisation of existing
industries and the development of clean energy industries– helping to ensure impacted stakeholders are heard andconsidered in Australia’s transition.

• Net zero, purpose at pace
• Climate transition planning: prepare your organisation• Accelerating Australian electric vehicle uptake– KPMG Australia• Potential economic pay-off of a circular economy©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSCASE STUDYBuilding resilience toextreme weather events
due to climate change
KPMG Australia was engaged by Essential
Energy to assess the impact and risks
to its distribution network posed byclimate change. Essential Energy is a
NSW Government-owned corporation,with responsibility for building, operating
and maintaining one of Australia’s largest
electricity networks – delivering essential
network services to more than 885,000
homes and businesses across 95% of
NSW and parts of southern Queensland.
As extreme weather events become more frequent, protecting the physical network infrastructure – the ‘poles and wires’,
underground cables, substations and transformers – is critical to ensuring a safe and continuous supply of power tocommunities and cities.
KPMG’s work with Essential Energy involved forecast modelling to quantify the impact of bushfires, floods and windstorms
on its network and development of a strategic response to the physical risks associated with climate change.
This work has enabled Essential Energy to gain better visibility of and better manage climate risks to support continuous
servicing into the future.

This year we released several new offerings to the Australianmarket including:• Climate IQ – a comprehensive, multi-industry risk
management tool that evaluates KPIs to address questions
around a company’s exposure to climate change, to help
formulate decisions in line with business needs andregulatory requirements.
• Climate Navigator – a climate risk and resilience tool toreview our clients’ structures, systems, and settings to
identify opportunities for improvement, develop a practicalroadmap to good practice, and track progress over time.

• ESG maturity benchmarking tool – to informparticipating organisations on the current status of their
ESG governance, strategy and performance reporting
against peers.
• Embedded ESG – a tool to help our clients embed ESG
as a part of their organisation’s strategic performance
management practices, navigate ESG challenges andleverage future ESG opportunities.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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Ensuring our shift toclean energy benefits
First Nations communities
Australia’s transition to renewable energy can bringconsiderable economic opportunities for Indigenous
communities, as many large-scale renewable projects
are being developed on Indigenous lands. To achievethis, there is a need to focus on protecting cultural
heritage and Country, supporting cultural competency
and creating genuine social and economic benefits for
those communities.
KPMG Australia was commissioned by the Clean
Energy Council – the peak body for the clean energy
industry in Australia – to co-develop a set of leadingpractice guidelines for renewable energy companies
when engaging with First Nations communities. The
guidelines build on the 10 principles developed by theFirst Nations Clean Energy Network – a partnershipof Indigenous people, community organisations, land
councils, industry groups, legal experts and renewableenergy companies – to help ensure First Nations
communities, people and businesses participate inand benefit from the renewable energy transition.
Aboriginal and Torres Strait Islander peoples’ rights
and interests in land are formally recognised overaround 50% of Australia’s land area. The team isengaging widely across First Nations communities –on Country where possible – to cover a diversity ofdifferent regions and renewable technologies. We also
spoke with many renewable energy developers totranslate community needs, expectations and hopes
into practical action, supporting the industry towards
a just transition.
This guide is also a great chance to educate theindustry – particularly international stakeholders– about the historical and cultural significance ofAustralia’s First Nations people and their rights.
The guidelines will be launched in late 2023.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSTechnology
and innovation
OUR COMMITMENT:BUILD A THRIVING TECHNOLOGY BUSINESS AND INNOVATE
WITH OUR CLIENTS, ALLIANCE PARTNERS AND THE
STARTUP ECOSYSTEM
We are developing future capabilities, leveraging emerging
technologies and investing in cutting-edge research andstartups to help tackle complex business, societal andsustainability challenges.
For clients, KPMG Australia has been investing in solutions,products, managed services and platforms to help us
respond to the changing market and meet evolving client
expectations around data, cloud and technologies like
Artificial Intelligence (AI).
Our new Connected Technology Group (CTG), formed during
the year, is helping us build a modern technology business,transforming our firm and accelerating the growth and adoptionof innovative technology solutions.
KPMG Futures, established last year, leads our investment
in research, ventures and capabilities in emerging Horizon 2
and 3 technologies – focusing entirely on what lies ahead tohelp clients and our own firm predict, adapt, and leap into thisaccelerating change.

Experimenting with AI
When ChatGPT launched in late 2022, KPMG Australia initiallyrestricted access to the AI solution until security and data
sovereignty issues could be managed to protect sensitive
information, including client data. We performed a seriesof controlled tests to ensure ChatGPT met our security
requirements and access to the platform was provided acrossthe firm. Our Chief Digital Officer, John Munnelly, hosted an
innovation challenge, inviting our people to share their best
ChatGPT use cases and ways it could support the firm’s
culture of innovation.
KPMG Australia and the firm’s Alliance Partner, Microsoft,then worked together to understand how best to further
harness the AI platform within parameters set by our firm.
In March 2023, KPMG became one of a handful of companies
globally to be given access to a private version of ChatGPT
known as KymChat. The solution is directly integrated
with Microsoft Teams and allows our people to safely use
ChatGPT’s groundbreaking technology in the workplace.
On the first day of its launch, our people interacted with
KymChat over 10,300 times and after 100 days, the AI
powered chatbot had answered 55,000 questions frompeople across KPMG Australia.
In July 2023, KPMG launched a version of the world-classtechnology for clients, to help accelerate their AI journeys.
By the end of 2024, we are anticipating that KymChat willprocess complex data and respond to client issues withspecialist insights.

ARTIFICIAL INTELLIGENCE
We have been actively exploring the role that AI can play increating sustainable value and deepening our research to help
us and our clients navigate the trust challenges and potential
impacts that can affect its adoption. While our initial focus isexperimenting in-house, we are applying our learnings to client
offerings as well. We are now working towards embedding ourcollective learnings and thought leadership on AI into a peoplecentred AI governance framework to support the firm and its
clients, to be implemented next year.

NEW TECHNOLOGY SOLUTION FOR OUR FIRM AND OUR CLIENTS

10,300the number of times our people interactedwith KymChat on the first day of its launch©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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Understanding trust in AI with the Universityof Queensland
Now in its fourth year, our research into trustworthy AI led byProfessor Nicole Gillespie and the University of Queensland(UQ) generates timely insights that are helping shape emerging
thinking in this space. We continued our thought leadershipprogram to better understand the public’s attitudes towards
AI. Our most recent joint UQ and KPMG study Trust in AI:
Global Insights involved 17,000 people across 17 countries
and investigated the perceived risks and benefits around AI
use and the public expectations around the governance andmanagement of AI systems.
We found that three out of five people globally are either
ambivalent or unwilling to trust AI, but that most people(85%) believe that AI will deliver a range of benefits including
efficiency and innovation. While the benefits, challenges,
risks and opportunities that AI offers differ from one industry
to another, the research identified common design andgovernance principles and practices that the public expectorganisations to use when designing and deploying AI.
The Human Technology InstituteThis year, KPMG Australia started a four-year partnership with
the Human Technology Institute (HTI), which is housed at the
University of Technology Sydney (UTS). The HTI focuses on ahuman-centred approach to the development and use of AI ina way that achieves fair, accurate and accountable decisionmaking. We are working with HTI through three connected‘laboratories’, focused on AI strategic skills, practical tools
and policy. Together, we have begun to use these labs to
test, validate and collaboratively develop solutions to client
challenges, and engaged our people and senior leaders indiscussions, events and experiences.

KPMG FUTURESThe KPMG Futures team’s focus this year has been dedicatedto Next Generation Internet, quantum and next gen AI – theareas we believe will have the greatest impact on us andour clients.

Leading on emerging tech
Next Generation Internet – Head of Metaverse
Following a large number of enquiries from clients around theuse of Next Generation Internet and Web3, we appointed ourinaugural Head of Metaverse Futures, a first in our industry.
A specialist team now offers a unique approach to growthand innovation using game-changing metaverse technologies
and is designing new business models for the firm.

First mover in quantum computingThis year, KPMG Australia’s Quantum team has worked
with Microsoft and Quantinuum to demonstrate a significant
building block in making quantum computing more
efficient and accessible. This is the first time an Australiancompany has accessed and run code on the Quantinuum
Quantum computer.
Through this partnership, we have been able to develop and run
quantum code on real quantum hardware from a KPMG laptop
using Quantum Azure. This new functionality enables quantum
and classical computers to integrate seamlessly together inthe cloud, an industry first and an important step to quantumat scale. Our code was made available via open source. The
project represents a significant innovation and Microsoft has
published a public tutorial to explain to the broader quantum
community how to replicate the work that the KPMG
team undertook.
Generative AI and Large Language Models
We are also expanding our collaboration with fast-emerging
generative AI companies particularly with Large Language
Models (LLMs) to support internal processes such as bid
and proposal content generation, enabling our teams to craft
bespoke proposals which can be rapidly refined to meet ourclient-specific requirements. We are leveraging other LLMs andadvanced data modelling to understand and synthesise web
intelligence, to help our teams and clients quickly understandany market attributes such as risks, opportunities, participants,
trends and emerging capabilities.
Build leading firm-wide tech capability
Through our Eclipse Academy, we have created digital learning
modules providing fast-paced introductions to fundamental
concepts, insights and trends on innovation and technology,
including modules on automation, extended reality andthe metaverse, as well as generative AI. With the HTI, ourpeople have been able to interact with facial recognition
and AI through an immersive experience called Face Value.
The events challenged the thinking of 150 partners and 240
colleagues, helping them better understand the decisions
AI makes and how it can impact their lives, to inform morehuman conversation about emerging technology.
Working alongside Professor Genevieve Bell and the ANU
School of Cybernetics, we have also delivered capability
building on cybernetics for our partners.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSINCUBATING AND INVESTING IN TECH STARTUPSKPMG x Stone & Chalk
Alongside Stone & Chalk, a leading innovation startup andscale-up hub, KPMG Australia launched the Future Technology
Program to help Australian startups succeed and grow. The
program runs twice a year, supporting five startup founders
and their teams who receive complimentary residency for
12 months at one of Stone & Chalk’s startup hubs and abespoke support program covering areas such as investor
readiness, industry insights, connections to potential clients,and mentoring on how to work with large, global companies.
The Program’s first cohort of supply chain-focused startups
is almost halfway through their year-long program. Startups
supported by the program include Givvable, an ESG-focused
supply chain management platform, and Zondii, a real-timesmartphone verification and validation solution for the foodand fibre industry. The team is currently working on selecting
the startups for the second cohort, which will focus on
space technology.
Incubating tech startups
KPMG Futures also incubates tech startups inside KPMG ina protected environment to allow them to scale quickly andaccelerate technology solutions for our clients and our firm.
Wiise and KPMG Origins are two of several such ventures
within KPMG Futures.
• Launched by KPMG in partnership with Microsoft in 2018,
Wiise is a standalone business-to-business SaaS startup
developed for companies experiencing growth that are
ready to move beyond accounting and invoicing softwareand are looking for a robust solution as they scale theiroperations. KPMG Futures has incubated the Wiise teamas they have worked with several partners and resellers
in Australia, and achieved significant growth over the past
year. Hundreds of Australian companies now use Wiiseto help manage their business operations.

For example, in August 2022, KPMG Origins launched
the Building Trustworthy Indicator (BTI), working closelywith the NSW Government to help increase consumer
confidence in the building and construction industry.
Environmental regulators in NSW and Queensland
have also turned to KPMG Origins to help them develop
a consistent solution to track hazardous waste.

• KPMG Origins has grown to a team of over 40 members
since its creation in 2021. The centralised data platformleverages blockchain technology to increase transparency
by helping reshape industry supply chains throughbetter traceability, visibility and control of data acrossorganisations, industries and international borders.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESS
Societal impact
OUR COMMITMENT:CREATE A FAIRER, MORE INCLUSIVE AND MORESUSTAINABLE FUTURE FOR OUR COMMUNITIES
We work alongside impactful NGOs, community organisations
and social enterprises, leveraging our people’s passion,
expertise and time to help create meaningful and lasting
positive change in our communities.

OUR IMPACT IN THE COMMUNITY

Every part of the organisation is engaged in delivering on
our commitments outlined across our Climate Action Plan
2023–2030, Lifelong Learning Action Plan 2022–2026, andReconciliation Action Plan 2021–2025.
Our people are making a difference in our communities throughtheir day-to-day work, their involvement in skilled volunteeringand mentoring programs, and their participation in on-theground volunteering activities with our national and state
community partners.
With our Board Connect program, we also provide
opportunities for our people and partners to connect with
relevant roles and build their capacity and readiness toengage in not-for-profit Directorships.

• 455 of our people held over 575 Board roles with not-forprofit organisations.
• Overall, 1,399 of our people engaged in 17,178 hours
of community impact.
• We have valued our people’s time, combined with ourcommunity investment, at $12.9 million.28
This year, we refreshed our community impact strategy
to strengthen our alignment with specific UN Sustainable
Development Goals (SDGs) and help us further progress
our commitment to create a fairer, more inclusive, and moresustainable future for our communities. We have focusedon the following three impact areas:• ‘Reducing inequalities’ – enabling fairer and more
inclusive access to opportunities.
• ‘Climate action’ – accelerating climate action and solutions
for a nature positive world (refer to our progress in thePlanet section).
• ‘Resilient and sustainable communities’ – advancing
ideas and supporting initiatives that promote community
wellbeing, resilience, and sustainable futures.

28

455
1,399
$12.9

PEOPLE
on not-for-profit Boards

PEOPLE
participating involunteering activities

MILLIONin community contribution

This includes value of volunteering and pro bono time, cash contributions, management costs and other non-cash contributions.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSREDUCING INEQUALITIES
Lifelong Learning
Through our Lifelong Learning Action Plan 2022–2026, we arecommitted to supporting people in our community experiencing
disadvantage, and those under-represented in the workforce
to access the skills and opportunities they need to thrive in the
new world of work.
In the past 12 months, we have dedicated our focus toreducing inequalities by helping remove the barriers toparticipation in STEM careers for girls, women and people fromlow socio-economic backgrounds and by reducing the digital
divide in high school students. We have directly supported
over 1,300 young people through our various lifelong learning
mentoring, traineeships and digital inclusion programs this year.

Reducing the digital divide
The KPMG Laptops for Lifelong Learning program, incollaboration with social enterprise WorkVentures and
ABCN, was launched in February 2022 to help deliver on
our commitment to increase digital inclusion with a targetof donating 1000 laptops by 2026.
Since then, the firm and our people have raised funds tosupport 444 digitally excluded high school students within the
ABCN network with a refurbished laptop and personalised
technical support from WorkVentures.

ABCN
KPMG is a founding partner of the Australian Business andCommunity Network (ABCN) since 2005. Through ABCN, weconnect our people with students from low socio-economic
backgrounds to provide workplace-based mentoring programs
that develop students’ confidence, skills and aspirations vitalfor thriving in the workplace of the future.
This year, over 200 KPMG people contributed their time as
ABCN mentors and volunteers, to help shape and guide thefutures of 631 students. Our CEO Andrew Yates also dedicatedhis own time by joining the ABCN Board and participating in
ABCN’s ‘Partners in Learning’ co-mentoring program with ahigh school principal.
KPMG Technology Traineeship Pathway
The KPMG Technology Traineeship Pathway provides highschool graduates in Sydney with an alternative route to acareer in technology. The three-year traineeship pays highschool graduates to rotate through the various technology
teams within KPMG Management Consulting, while studying
for their diploma at TAFE. Since 2022, 20 high school trainees
have completed the program. Traineeship opportunities are
currently offered to Year 12 graduates from targeted publichigh schools in Western Sydney.
Robogals
Robogals is a student-run organisation that aims to inspire andempower young women to consider studying engineering andrelated fields.
This year, KPMG supported over 300 students throughnetworking, professional development, competitions andtechnical presentations, to encourage young women to
explore STEM in school and to take up STEM careers.

CASE STUDY

Laptops for Lifelong Learning:
our impact on digital inclusion•

444 students from low socio-economic high schools
received refurbished laptops and digital inclusion
support from WorkVentures.

•

15 schools in low socio-economic areas in the ABCN
network supported.

•

80% of students surveyed indicated that the lack ofadequate access to a computer meant that they either
occasionally, often or frequently had trouble finishingclasswork and assignments.

“I have never had a laptop so this is a massive opportunity forme. I am also excited because I don’t have to go to the library
to use the laptops there, I have my own one now! Thankyou!” – High school student and 2023 laptop recipient.
Principal Brenton Farleigh from Loganlea State High School
in Queensland, where less than 10% of students havea device they can bring to school, wrote to personally
thank KPMG and its people: “I am a believer that financial
hardship should not be a barrier to students becoming
digitally literate. However, in my experience, it often is. Your
contribution to our school will make a significant differencein the lives of our students.”©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSRECONCILIATION
Reconciliation continues to be a core part of delivering toour commitment to enable fairer, more inclusive access toopportunities for our First Nations communities. In December
2021, KPMG launched its 2021–2025 ‘Elevate’ Reconciliation
Action Plan (RAP), our third Elevate RAP, and our fifth
RAP overall.
In January 2023, we refreshed our Indigenous Peoples Policy,
in line with the United Nations Declaration on the Rights ofIndigenous Peoples.
Importantly, we are also making good progress on theleadership projects committed to in our RAP, which aredesigned to contribute to long-term positive change for
Aboriginal and Torres Strait Islander peoples:• We are developing our firm’s first Indigenous culturalsafety framework in conjunction with an independent
Indigenous consultancy.
• We are working collaboratively with the Indigenous suicide
prevention sector to develop an approach to Indigenous
suicide prevention. In February 2023, we released The
StatUS Report: A case for First Nations LBGTIQA+SB SelfDetermination in conjunction with Black Rainbow, a nationalorganisation focused on the pursuit of positive health andwellbeing for the Indigenous LGBTIQA+SB community.
• We have continued to work closely with community
partners including Jawun, the Australian Indigenous
Education Foundation (AIEF) and the GO Foundation.
We currently have 15 people mentoring Indigenous highschool students through AIEF, and 22 people participatedin six-week long Jawun secondments during 2023.
We once again exceeded our Indigenous procurement target,achieving 3.82% against a target of 3% addressable spend.
We report annually and hold ourselves to account on
our progress with Reconciliation through our FY23 RAP
Progress Report.

3.82%

INDIGENOUS
PROCUREMENT SPEND
against a 3% target©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSRESILIENT AND SUSTAINABLE COMMUNITIES
Mentoring social enterprises
Our partnership with the Social Impact Hub ‘RISE Mentoring’
program is an example of initiatives that promote community
resilience, wellbeing and sustainable futures. The program isdesigned to help social enterprises grow and navigate businesschallenges by matching them with corporate mentors who
have the expertise required to assist on a specific project.
This year, 34 KPMG people embarked on six-month longprojects working with social enterprises focusing on issues
that impact our communities such as homelessness, accessto employment, food insecurity, circular economy, anddisability inclusion.

CASE STUDYSUPPORTING A RESILIENT COMMUNITY SECTOR

The Beautiful Bunch (TBB) is a flower deliverysocial enterprise launched in late 2020 during oneof Melbourne’s extended lockdowns, to create
an inclusive work environment for young refugee
women. Within weeks – and largely through wordof-mouth – the team increased its sales from 7 to70 bunches of flowers a day. Soon, the organisationneeded to find additional ways to generate revenue
and we partnered with the RISE program to identify
business development opportunities.

RISE mentoring: from little
things, big things growA refreshed Pro bono @KPMG program
We reviewed our Pro bono Program to identify the areas
we are best placed to leverage our expertise and deliver
meaningful impact to assist the not-for-profit and social
enterprise sector and the diverse communities they support.
This year we delivered 116 pro bono engagements valued at
approximately $6.5 million.

A five-person team from KPMG was matched withThe Beautiful Bunch and produced an outreach kit tohelp engage prospective customers, which included
hospitality venues, salons and large corporates. KPMG
volunteers shared their knowledge of marketing andassisted the enterprise with their presence on different
social media platforms, including Instagram and LinkedIn.

Deepening research into wellbeing
Our people made an important contribution to research andawareness around community health and wellbeing throughmultiple pro bono engagements, many of which were madepublic and communicated through media relations activity togenerate broad community awareness:• Connections Matter – a research report developed with
the Groundswell Foundation revealing the prevalence ofloneliness in Australia and the significance of its impact
on all areas of the community. Our report highlighted thesignificant economic impacts of loneliness, with an annual
healthcare cost to the Australian economy of $2.7 billion,
or approximately $1,565 per person per year.
• ‘Understanding the cost of addiction in Australia’ – a joint
report with Rethink Addiction, looking into the impact on
productivity and associated losses to the nation’s economy
due to addiction, which amounted to $80 billion for 2021
alone. We found that to reduce the harm across all areasof addiction, we must bolster our efforts in prevention,
reducing stigma to promote help-seeking and invest in
early intervention.

• The Australian Mental Wellbeing Index – part of a seriesof reports in a three-year partnership with Smiling Mind, adigital-led mental wellbeing not-for-profit, reporting mental
wellbeing trends based on the data collected through the
Smiling Mind app. The Index analyses and reports on key
factors contributing to positive mental health outcomessuch as emotional awareness and regulation, focus andconcentration, relationships and social connections, sleep,and stress.

HUMANITARIAN SUPPORT
During 2023, we also continued to partner with our global
disaster relief partner UNICEF Australia to support the
Sri Lanka appeal in July 2022 with more than $28,000; andagain in February 2023, KPMG Australia and our people jointly
contributed $75,000 to the Syria and Turkiye Earthquake appeal.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESSOUR COMMITMENT:ADVOCATE ON THE ISSUES THAT MATTER
We progressed our work in advancing ideas and awarenesson key issues through our ongoing advocacy, research andthought leadership including on gender equity, climate
and migration. During 2023, KPMG made 37 submissions
to various government and parliamentary inquiries andconsultations and published two public policy papers.

KPMG also published Towards a new and improved era inwomen’s equality: Valuing unpaid work in November 2022.
The report highlights the failure to recognise the value of unpaid
work, and outlines recommendations to reduce this inequality
including the consideration of a Carers’ Income Tax Offset,
which would be credited against any income tax payable uponcarers returning to work after caring for children, people with adisability or elderly parents, in recognition of the value of their
unpaid caring work.

ISSUES THAT MATTER
Equal opportunity
KPMG has continued its gender equity series in FY23 with
two new public policy papers.
In July 2022, KPMG released She’s Price(d)less: The economicsof the gender pay gap. In collaboration with the Diversity
Council of Australia and the Workplace Gender Equality
Agency, the report was the fourth in a series since 2009. The
reports analyses the contributing drivers of the gender pay
gap to explain why the gap exists, and where it needs to beaddressed the most. This most recent report showed that thegender pay gap in Australia has remained stubbornly unchanged
since 2019, and while there has been action across the public
and private sectors to address this, there is a worrying trend in
the rise of industry and occupation segregation.
In August 2022, we published Budgeting for gender equity
which outlines how gender responsive budgeting (GRB)
can act as a powerful enabler for the successful delivery of
governments’ gender equity strategies, both in terms of thedirect impact on policy funding and the signal that it sends tothe community about transparency and accountability.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR PROSPERITYPROGRESS
Building Australia’s international competitivenessIndigenous affairs

KPMG has continued to contribute to policy conversations inareas which are critical to Australia’s competitiveness in the
global market. This has included a number of submissions in
the areas of AI, data and technology including Australia’s cybersecurity strategy, data strategy, AI and automated decisionmaking regulation, and crypto. KPMG’s broader work in thisarea is discussed under ‘Technology and innovation’.

As an Elevate Reconciliation Action Plan (RAP) organisation,
KPMG supported the Uluru Statement from the Heart together
with other leading companies during National Reconciliation
Week in 2019. During this year, we considered our approachto the debate on the upcoming referendum on constitutionalrecognition and The Voice to Parliament, with our Board and
NEC listening to those on both sides of the debate.

This year KPMG provided submissions to:

Aligning with our support of the Uluru Statement andconsistent with the commitments in our RAP, we
subsequently publicly confirmed our decision to support
a Yes vote as a signatory to Reconciliation Australia’s
joint statement, released on 2 July 2023.

• Measuring what matters• Climate-related financial disclosure• A range of crypto-related regulatory consultations, including
crypto token mapping and the tax treatment of digitalassets and transactions• Automated Decision Making and Artificial Intelligence
regulation• Australian Data Strategy• Australia’s Cyber Security Strategy

As a firm, we are proud to support a Yes vote in thereferendum. We believe it is an important next step on a long
journey towards a reconciled nation. A reconciled Australia is
one where we recognise our shared past, present and future
and where, in that future, the Voice of Indigenous Australians
is heard, understood, and respected. We believe constitutionalrecognition and The Voice will lead to a stronger, fairer andbetter nation for all.
Importantly, we acknowledge that there will be different pointsof view, and we respect everyone’s right to vote according totheir own beliefs.

• A migration system for Australia’s Future• Review of the Privacy Act• The Australian Government’s Employment White Paper©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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MATERIAL TOPICSASSESSMENT
Understanding thematerial topics thatmatter to our businessand our stakeholders

A range of inputs were collected to inform our material topics:

CLIENTS AND
MARKETS• Review of our latest CEO survey, ESG reports from Australianindustry leaders, and client interviews.

This year, we reviewed andrefreshed the list of material
topics shared in our last
impact report. In line withthe latest Global Reporting
Initiative guidance, we
consulted senior leadersand subject matter experts
within KPMG Australia andreviewed key documents,
data and insights.

EMPLOYEES• Review of internal engagement surveys including our Global
People Survey, research to inform our People Promise andengagement with the leadership of our People & Inclusion team.

PEERS• Review of the topics raised by our international KPMG member
firms, including KPMG International and our domestic andinternational competitors.

REGULATORS AND
STANDARD SETTERS• Review of guidance from ISSB, GRI, ASIC and CAANZ on the
topics that impact professional services firms.

For the first time, we
also interviewed external
stakeholders specificallyto inform a deeper
understanding of our current
and emerging ESG impacts.
We engaged with clients,
suppliers, alliance partners,
and representatives of nongovernmental and community
organisations working acrosshuman rights, reconciliation,and the environment.

SENIOR LEADERSHIP• Review of strategic risk documents and consideration of ESG
risks, interviews with our Australian Chairman and National
Executive Committee (NEC) members.

SOCIETY• Review of media and public commentary, including monitoring
emerging ESG topics of importance to society and our industry,
review of independent trust research, and interviews with
non-governmental and community organisations.

Our approach to materiality

Our Impact Plan Steering Group, which is is comprised of senior representatives from each of ourfour reporting pillars – Governance, People, Planet and Prosperity – reviewed the outputs of ourmaterial topics assessment and the prioritisation of our most significant impacts for reporting.
Our Board and National Executive Committee (NEC) reviewed and approved this year’s material
topics and the commitments presented within this report.
As a result of our assessment, we added ‘Talent Attraction’ as new material topic and updated
three existing topics to acknowledge new or potential impacts:

1.

‘Continuous learning’ is now ‘Continuous learning and future-ready talent’,
to reflect the growing importance of building capabilities within and outside KPMG
by investing in the future of work skills and careers.

2.

‘Innovation’ is now ‘Technology and innovation’, to highlight the convergence of new
and emerging technologies such as generative AI, the metaverse and quantum computing,and our role in supporting their responsible adoption.

3.

‘Community impact’ is now ‘Societal impact’, in recognition of our Purpose andour commitment to creating a fairer, more inclusive and more sustainable future.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR 12 MATERIALTOPICS FOR 2023
GOVERNANCEPEOPLE

1

2.

3

PURPOSE, VALUESAND CULTURE

TRUSTED AND
TRUSTWORTHY

Our Purpose – inspire
confidence and empowerchange – is underpinnedby our Values: Integrity,
Excellence, Courage, Together
and For Better. These guideour culture, the decisions we
make, the work that we doand the way we behave witheach other, our clients and all
our stakeholders.

Through clear and fit-forpurpose governance andby exhibiting the highest
standards of personal
and professional integrityin everything we do, we
continue to build, preserveand strengthen trust.

INFORMATION PROTECTION, EMPLOYEE ENGAGEMENTDATA PRIVACY AND
AND EXPERIENCESECURITY
We continue to put ourOur commitments:

Our commitments:• Act lawfully, ethicallyand in the public interest.

Our people, clients andother stakeholders entrust
us with sensitive data andinformation. We continue
to invest in the policies,
processes, controls,
training and capabilities tomaintain stakeholder trust
by ensuring we protect dataand information against loss,
misuse and exploitation.

4
people at the heart of what
we do through our ongoing
listening strategy and act onopportunities to support andinspire them throughout theircareer at KPMG.
Our commitment:• Provide a great people
experience, built on ourPeople Promise.

• Respect human rights andwork against corruption
and modern slavery.

Our commitment:

5

6

7

INCLUSION, DIVERSITY
AND EQUITYEMPLOYEE HEALTH
AND WELLBEINGTALENT ATTRACTIONCONTINUOUS LEARNING
AND FUTURE-READY TALENT We continue to reimagine our

We continue to actively
support and accelerate
inclusion, diversity, equity
and belonging across ourbusiness – encouraging ourpeople to ‘come as they are’.

Our holistic wellbeing
approach provides the
programs, resources, andtools for each person toachieve optimal health andsustainable performancein their personal andprofessional lives.

We focus on upskilling,
reskilling and creating
opportunities for our people
to develop the critical skills
they need to grow, lead andthrive in the future of work.

Our commitment:• Foster a continuous andfuture-fit learning anddevelopment culture.

• Always act with aclear Purpose.
• Drive a responsible
tax practice.

• Uphold the highest
level of data andinformation protection,
privacy and security.

• To lead the professionin audit quality.

PEOPLE

Our commitment:• Champion gender equality
and create an inclusive andequitable culture for all.

• Protect the health andwellbeing of our people.

Our commitment:

8
talent attraction, recruitment
and onboarding process todeliver an exceptional andseamless experience andaccess new, skilled anddiverse talent.
Our commitment:• Simpler, more inclusive
recruitment processes toattract world-class talent.

©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
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OUR 12 MATERIALTOPICS FOR 2023
PLANETPROSPERITY

9

10

11

12

CLIMATE CHANGE
AND ENVIRONMENTALSUSTAINABILITYIMPACT OF OUR
CLIENT WORKTECHNOLOGY ANDINNOVATION

SOCIETAL IMPACT

We continue to deliver
relevant, quality services that
help build trust, transformbusinesses and create
sustainable value for people,
clients, communities and theenvironment.

We are developing futurecapabilities, leveraging
emerging technologies andinvesting in cutting-edge
research and startups to help
tackle complex business,
societal and sustainability
challenges.

We continue to collaborate
and advocate alongside
our people, clients, alliancepartners, community
organisations and NGOs
to support our transition
towards net zero and build
a more sustainable andresilient future.
Our commitments:• Decarbonise ouroperations and supply
chain towards net zero.

Our commitments:• Strong economic
contribution.
• Exceptional client
outcomes, throughwork that matters.

Our commitment:• Build a thriving technology
business and innovatewith our clients, alliancepartners, and the startup
ecosystem.

Leveraging our people’s
passion, expertise andtime, we strive to create
meaningful and lasting
opportunities and positivechange in our communities
and to advocate for theissues that matter most.
Our commitments:• Create a fairer, more
inclusive and moresustainable future forour communities.
• Advocate on the issues
that matter.

• Support our clients’ andAustralia’s transition to
net zero.
• Strengthen climate
resilience with ourpeople, clients andcommunity partners.
• Advance our commitment
to circularity.
• Understand and improve
our impact on natureand biodiversity.

The UN Sustainable Development Goals (SDGs) most relevant to us:

SDG 5: Gender
Equality

SDG 8: Decent Workand Economic Growth

SDG 10: Reduced
Inequalities

SDG 13: Climate
ActionSDG 16: Partnershipfor the Goals©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company
limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.

66

CONTACT
Andrew Yates
Chief Executive Officer
T: +61 2 9335 7545
E: ajyates@kpmg.com.au
Alison Kitchen
National Chairman (to 31 August 2023)
T: +61 3 9288 5345
E: akitchen@kpmg.com.au
Martin Sheppard
National Chairman (from 1 September 2023)
T: +61 3 8626 0918
E: msheppard1@kpmg.com.au

KPMG.com.au

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©2023 KPMG, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English
company limited by guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.

Liability limited by a scheme approved under Professional Standards Legislation.
August, 2023. 1107366131BRAND.