KPMG Australia chairman Martin Sheppard will leave the firm as part of a governance overhaul that also includes the departures of audit partners Paul Rogers and Eileen Hoggett and the appointment of the firm’s first independent chair.
The changes, announced on 23 June 2026, mark the latest escalation in KPMG Australia’s response to failings surrounding confidential client information and the handling of a whistleblower. Sheppard will remain for a short transition period before leaving the firm and retiring from his regional board responsibilities.
Rogers and Hoggett are also leaving KPMG Australia. Both had already been identified as subjects of an Australian Securities and Investments Commission investigation linked to the audit controversy. Hoggett previously stepped down as chief operating officer, while Rogers remained an audit partner.
The latest departures follow the earlier resignations of chief executive Andrew Yates and head of audit Julian McPherson. Stan Stavros is serving as interim chief executive while KPMG progresses its search for a permanent CEO, who will be expected to refresh the executive team.
KPMG’s planned governance changes go beyond replacing senior personnel. The firm intends to appoint an independent chair and add independent members to its Australian board, creating a balance between external directors and KPMG representatives. The board’s remit will also be reviewed, with independent members involved in committees overseeing audit quality, ethics, whistleblower controls and other public-interest responsibilities. The structure represents a significant change for a partnership in which senior leadership has traditionally been selected from within the firm. Independent oversight should create greater distance between those responsible for commercial performance and those assessing conduct, risk and audit quality.
Principia Advisory has been appointed to conduct an independent retrospective review of KPMG Australia’s whistleblowing system. The firm has committed to publishing the findings and updating its policies governing how disclosures are identified, escalated and managed. Firm-wide training will accompany the changes.
A separate external review will examine the handling of the whistleblower complaint and the failings that followed. KPMG also plans to appoint a third party to assess progress against its action plan and publish periodic updates. The Commonwealth Department of Finance is conducting its own independent review, with which KPMG has said it will cooperate.
The overhaul follows KPMG’s admission at a parliamentary hearing that confidential Optus information had been shared with an internal team bidding for Telstra’s audit. That disclosure widened a controversy that had already centred on allegations involving confidential client material and the firm’s earlier failure to substantiate the whistleblower’s concerns.
Controls around audit pursuits will now be amended, ethical barriers strengthened and confidentiality training made mandatory across the firm. Audit partners and directors will receive further targeted training covering client confidentiality, privacy and information protection.
Replacing leaders will not settle the questions facing KPMG Australia. Audit committees, regulators and public-sector clients will want evidence that confidential information is properly separated, whistleblowers are protected and senior personnel face consistent consequences when controls fail.
The independent chair and new external directors will inherit responsibility for demonstrating that the revised structure can challenge management rather than simply endorse internal decisions. KPMG’s credibility will depend on the publication of review findings, visible progress against the action plan and proof that governance changes alter behaviour throughout the partnership.
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