KPMG whistleblower refused to move to Australia, fearing alleged bullying
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The whistleblower who triggered the scandal engulfing consulting giant KPMG Australia refused to move to Australia in part because he claimed he had been bullied by one of KPMG’s most senior executives at the time.
Documents released by a parliamentary committee this week show the whistleblower, who has not been identified, had been hired by KPMG outside Australia and had initially been open to moving back as the firm requested under its policies.
Kim Lawry was one of KPMG’s senior audit partners and a member of its board until last week.
In July 2023, the freshly released emails show, the man said that he would not move back to Australia from an unknown country in part because of what he said was “bullying and defamation” by Kim Lawry, a top audit partner and board member at KPMG.
“I have raised with you and a number of other partners the inappropriate and bullying behaviour of Kim Lawry,” the whistleblower wrote to a colleague at the firm in 2024.
“I have been retaliated against as a consequence of not relocating to Australia and for concerns that I have raised around the behaviour of certain partners,” the whistleblower said in emails that had been made public by a parliamentary committee this week. The emails do not say what form the alleged bullying took.
Lawry, communicating through a spokesperson, declined to comment but pointed to KPMG’s previous response that the allegations had been investigated and were found to be unsubstantiated.
“KPMG has not been able to substantiate the allegation,” the firm told a parliamentary committee in April this year. “No evidence of bullying, aggressive, or threatening conduct was identified.” Lawry has previously been described as a “well-liked” staff member at the firm in other media outlets.
The documents released by the Parliamentary Joint Committee on Tuesday evening revealed for the first time a partial record of the whistleblower’s emails to KPMG from 2024, which raised a raft of complaints about the firm. As well as the alleged bullying, the man complained about taxation, superannuation, pay rises, weekend work, travel and bonuses.
Many of those issues related to the relocation that KPMG Australia appears to have raised at various points before changing its policies in June 2024 to demand all employees live in the country.
“The policy states that under no circumstances, can a partner or employee of KPMG Australia work remotely from another country on a permanent or long-term basis,” a KPMG executive told the whistleblower via email in July 2024 after he had already raised issues with the firm. “This new policy position will be applying across all teams.”
In an escalation of its response to the scandal at KPMG, on Wednesday, ASIC sent a letter to 2900 registered company auditors warning them of meeting their professional obligations amid “concerns about trust and confidence in the profession” due to the scandal.
The unidentified whistleblower singled out Lawry for particular attention in his correspondence with the firm.
The whistleblower said Lawry was “protected” due to her board position and her crucial role in bidding for the lucrative Westpac audit account that was worth around $34 million a year.
“I was also actively discouraged from raising issues regarding Kim as she was the lead audit partner on the Westpac pursuit, a contract that is commercially sensitive and important to KPMG, and any investigation into Kim or further action may have put this contract in jeopardy.”
KPMG ultimately won the lucrative Westpac audit contract, but this has been jeopardised by the fallout from the whistleblower scandal.
Lawry resigned from the KPMG board and partnership last week after the bank requested that she be removed from the audit contract “to ensure there is no distraction”.
Chairman Martin Sheppard stuck to his defence of KPMG at the public hearing last month but resigned within the week. Getty
Westpac has not indicated plans to change auditors due to the scandal, but the bank’s audit committee chairman and former KPMG partner, Peter Nash, resigned this month over perceptions of conflict over his relationship with the firm and former KPMG chairman Martin Sheppard.
Lawry was one of the senior partners sanctioned by the firm this year over their access to confidential Lendlease board papers that contained information which was allegedly used ahead of its Westpac audit bid.
The other two partners involved, Eileen Hoggett and Paul Rogers, had previously resigned from KPMG over the matter.
A spokesman for Lawry confirmed she was working as an independent contractor to KPMG to help transition the Westpac audit account to the new audit leader.
Law firm Allens is conducting an ongoing investigation into the whistleblower’s claims after the firm admitted that its previous investigations, which largely found no evidence of wrongdoing, had been inadequate.
KPMG’s submission to parliament from April, published this week, also referred to whistleblower allegations of racism and sexism and said the allegations did not “contain sufficient information to enable further investigation”.
The parliamentary committee released the documents on Tuesday following the appointment of KPMG veteran John Sams to replace Yates as CEO.
Federal and state governments have suspended new business with KPMG while they review its fitness to remain a contractor. ASIC is investigating allegations relating to KPMG auditors and their work with corporate clients.
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Colin Kruger is a senior business reporter for the Sydney Morning Herald and The Age.Connect via email.