Kenta Kon is set to be the new CFO of Toyota as of this week, as the firm aims to eliminate all executive vice president (EVP) roles and streamline the way the company is managed. By doing this, it plans on improving production systems and shrink costs in all areas.
Answering to CEO Akio Toyoda, who has been at the helm since 2009, Kon will be the firm’s no.2 executive. Current CFO Koji Kobayashi is set to remain within his secondary role as chief risk officer. Six of the firm’s EVP roles, which have been in place since 1982, will be binned, paving the way for a new more streamline executive management system. Some of these roles will now become COO roles and the according individuals will manage more niche operations of the firm, though four of these will pretty much continue working as the same role, just without the EVP title.
“I have judged that it is necessary for me to directly communicate with the leaders of the next generation and to increase the amount of time for sharing our concerns, by further reducing the number of layers of management.”
The appointment of Kon as CFO is just one of Toyota’s latest moves in simplifying the way it works internally, in order to compete on a level playing field with rivals, and as one of the world’s largest motor manufacturers, keep up with the latest technology, such as electric vehicles, self-driving cars and more.
According to Reuters, President Akio Toyoda said: “I have judged that it is necessary for me to directly communicate with the leaders of the next generation and to increase the amount of time for sharing our concerns, by further reducing the number of layers of management.”
As KPMG aims to dramatically scale back its costs and restructure its operations, particularly following recent performance backlash, and in preparation for regulatory changes in the financial sector, it is planning a one-off cull of its UK partners.
Back in August KPMG suffered serious reputational damage following the collapse of Carillion, and in the past year or so has had to pay out over £20 million in regulatory fines. In order to manage performance, it appears KPMG is now taking serious action by cutting away around 65 partners form its UK divisions.
According to the FT, it’s pretty normal for KPMG to lose around 45 partners each year in staff turnaround, either by those who leave naturally, or forced into retirement, but this is the single biggest company action in years.
KPMG has confirmed most of the departures will come from its business divisions, though its unlikely many will come from KPMG’s perceivably low-performing auditing divisions.
KPMG said: “It is critical that our firm constantly evolves as we build the mix of capabilities required to service the changing needs of our clients. To achieve this, we are significantly increasing our investment in all of our core businesses — audit, tax, deals and consulting. This year we have appointed 50 new partners and 200 new directors, across all parts of our business.”
You can read more about KPMG and the other Big Four firms’ performance in one of our latest special features: ‘Are the Big Four Still ‘the Best’?’
UPDATE:
Recent reports indicate KPMG has now denied allegations that it would be culling a tenth of its UK partners.
Donald Trump is set to make a decision on the Chair of the Federal Reserve by Thursday this week. This decision will shape a big part of the US President’s economic legacy in the job.
The current chair of the Federal Reserve was appointed by President Obama in 2014 and is the first woman to hold the position.
Below Finance Monthly hears from a few expert sources on their thoughts surrounding the future prospects and overall impact of the appointment of a new US Fed Chief.
Joel Kruger, Currency Strategist, LMAX Exchange:
We worry investors could be setting themselves up for a letdown on this expectation the appointment of Jerome Powell as the next Fed Chair will generate a sustainable rally in risk assets. There is a danger associated with what has become a fixation on 'one dimensional role designation.' Central bankers should be neither inherently hawkish or dovish. The Fed's responsibility is to ensure it works in the best way possible to achieve its goals of maximum employment and price stability.
Considering where we're at in the cycle, there's simply little room for dovish central banking into 2018, much in the same way there was little room for hawkish central banking back in 2008, at the onset of the financial markets crisis. We believe we've reached the point where dovish leanings will no longer pair well with effective monetary policy, given an economic outlook contending with the very nasty combination of full employment, financial stability risk (from overinflated stocks), and the threat of rising inflation. We would also add that the prospect of Powell as the next Fed Chair is one that has been played out ad nauseam. This alone leaves risk assets vulnerable and exposed to a sell the fact reaction, albeit after what is likely to be an initial wave of euphoria.
Mihir Kapadia CEO and Founder, Sun Global Investments:
After months of speculation, President Donald Trump’s nominee for the Federal Reserve chairman seems likely to be Federal Reserve governor Jerome Powell. A former investment banker with Treasury experience during the Bush administration, Powell looks to be a reliable choice for the role. The markets have reacted positively to the suggestion that Powell is the frontrunner in recent weeks following the President’s interviews with each of the candidates.
However, Powell’s succession to the Fed chair is not necessarily secure. Other candidates include former Fed governor Kevin Warsh, seen as a more hawkish alternative to the polices of Yellen ad Stanford Professor John Taylor who would definitely be seen as more hawkish. Gary Cohn, Trump’s economic adviser, was also touted for the job, although the President has indicated his preference for Cohn to remain in the White House. Furthermore, current Fed chair Janet Yellen still remains a viable possibility.
Trump’s relationship with Yellen has been tricky to define. On the campaign trail, Trump was highly critical of Yellen and her tenure, and accusing her of being political. However, his stance has softened considerably since becoming President, praising her both personally and professionally, leading some to believe that he could yet choose her for another term. Of all the candidates, Jerome Powell represents a pragmatic compromise for the President – he represents a break from the past and a shift towards Trump’s administration whilst representing continuity as his policies are unlikely to differ substantially from Yellen’s. Whatever the President’s decision, the Fed chair will play a powerful role in shaping the economic identity of Trump’s America.
We would also love to hear more of Your Thoughts on this, so feel free to comment below and tell us what you think!
