Skip to article navigation Skip to content

Public trust - Our performance

A page refresh occures when a subject is selected.

Skip article navigation.

Continuously improving quality

Over recent years, we have seen a steady improvement in quality – this is borne out by the results of both internal and external inspections.

  • In Assurance, 84% of our engagements rated ‘satisfactory’ in 2020/2021, compared with 78% the previous year.

  • In Advisory, we also maintained very high standards – 98% of our engagements rated ‘satisfactory’ (either green or amber), compared to 99% last year. Rates have been at 97% or above for three successive years now.

Improvements are due mainly to a further strengthening of quality culture and controls. During the year, inspections by our main regulator – the Netherlands Authority for the Financial Markets (AFM) – also confirmed the results of our internal quality reviews[1]. This adds to the earlier positive outcomes of other inspections by the AFM on our quality-oriented culture and system of quality controls. The US regulator PCAOB also commenced inspections this year. These results are expected next year.

We see partner involvement as a way of further improving quality – our aim is to use partners in areas where we believe they can make a positive difference to audit engagements. In 2020/2021, our partners accounted for 8% of all audit engagement hours with public-interest entities, or PIEs[2], compared with 9% the year before. With non-PIEs, that figure was 7%, unchanged from 2019/2020. For both PIEs and non-PIEs, the percentages are close to the KPMG benchmark (of 10% and 6% respectively). Very large engagements have a negative impact on these percentages since a relatively high amount of the engagement hours is spent by non-partners. Excluding the engagement hours of these very large engagements, the percentage of hours spent by partners on PIE for 2020/2021 and 2019/2020 would be 10% and 11% respectively. 

To help improve quality, we also keep a close track of complaints and suspected violations:

  • In 2020/2021, we identified 9 independence violations within the firm (2019/2020: 0). The increase can be explained as a consequence of more personal independence audits performed and none of these incidents impaired the independence of the firm. The figure of last years is corrected. A closer look at the reports after the financial year closed showed that there were no independence violations in the past financial year.

  • During the year, we recorded 82 quality-related instances (2019/2020: 71) – the majority were related to QPR ratings, restatements of financial statements and recidivism of the timely completion of mandatory e-learning courses and confirmations. Discipline-related exceptions mainly related to late completion of annual compliance affidavits or late completion of mandatory e-learning courses and timely updates of our tracking system for personal investments (KICS) during the reporting year.

  • Seven notifications or complaints (2019/2020: 10) were received through our whistle-blower hotline and all were followed up. One internal issue was identified and addressed in accordance with the applicable sanction policy.  

During 2020/2021, we also made progress in preparing the firm for two other changes that will further improve our approach to quality: the roll-out of KCw and the introduction – at the end of 2022 – of a new international quality standard for audits:

  • KCw – or KPMG Clara workflow – is our new eAudit system – it will make audits quicker, easier, improves quality and enables the application of the latest technologies. We see it as a vital step towards a fully data-driven audit. The system uses advanced data analytics, AI and next-level cloud technology, provided by Microsoft Azure, resulting in more insights and better risk management. KCw is currently being rolled out across KPMG, which will bring greater consistency to our audits. During the past year, we set up a transition support unit to help with implementation – KCw should be up and running by the end of next year. With the change to KCw, we are also updating to a new KPMG Audit Execution Guide – replacing the current KPMG International Audit Manual. This involves rewriting our audit methodology, one of the most significant changes we’ve made in the past 25 years.

  • At the same time, we are also preparing for the introduction of the new International Standard on Quality Management 1 (ISQM 1). The new standard shifts the focus from quality control to a firm’s overall quality management. We do not expect significant changes to corporate governance, but ISQM 1 will change the way we document decision-making. KPMG will make the switchover at the beginning of October 2022 (by the start of the firm’s 2022/2023 financial year).

Value to society

Part of Public Trust is making sure we make a positive contribution to society. We do this by sharing our knowledge and expertise – what we call ‘thought leadership’. We also support good causes, particularly in education and training – an issue we believe is fundamental to the UN’s current Sustainable Development Goals (SDGs), especially in areas such as gender equality. Where we can, we’re also reducing our impact on the environment - by restricting flights and switching to green transport options. In the years ahead, we also plan to extend carbon emissions reporting to include scopes 1-3[3]. Across KPMG, we are pursuing our Impact Plan, which sets out clear commitments in four areas: Planet, People, Prosperity and Governance; these commit us – among other things – to achieving net-zero carbon emissions by 2030, to building an inclusive culture, and eliminating discrimination in the workplace. Importantly, the Plan also commits us to giving financial markets, clients and leaders ‘clear, comprehensive, high-quality information’ on the impacts of climate change on their business – a commitment that goes to the heart of our purpose as a company.

In thought leadership, over the past year, we:

  • Published dozens of studies and articles addressing issues such as healthcare, pensions, data management and ESG reporting – we also issued a report on lessons to be learnt from the Dutch government’s handling of the Covid-19 crisis.

  • Organised regular webinars, courses and other events – and offered training and development for finance professionals through our KPMG Learning Academy.

  • Continued to share our views with policymakers and other public stakeholders – in 2020/2021, notably, we provided constructive feedback on a new draft Future Accountancy Sector Act in the Netherlands and proposals to introduce a standard set of Audit Quality Indicators (AQIs) across the profession. From 2021, we are including both fraud and ‘going concern’ in the auditor’s report for selected organisations.

In 2020/2021, positive media coverage of KPMG in the Netherlands had a potential reach 2.73 billion readers - a sharp increase from just under 1.6 billion the year before.

We also supported a number of good causes in education, including:

  • The KPMG Jan Hommen Scholarship programme, which provides funding for poorer students in vocational education. We support students for up to four years with bursaries worth EUR 2,500 a year; we also offer them coaching and mentoring. Students are selected following an initial traineeship and an three-day ‘Empower Survival Camp’.

  • The Refugee Talent Hub, which offers training to refugees with financial or IT skills. KPMG supports the Hub’s Finance Academy; the Academy offers a five-month training programme to help refugees find jobs in the Netherlands.

  • JINC, which helps disadvantaged youngsters into work – as part of the JINC programme, youngsters are introduced to KPMG, taught digital skills and shown how to apply for a job.

Our professionals also do pro bono work, which we support. In 2020/2021, KPMG employees volunteered just over 5,000 hours, lower than the previous year because of the Covid-19 pandemic. During the year, our pro bono projects included helping the charity Stichting Met je Hart (‘With Your Heart’ Foundation) with its IT operations, and support for the Fawaka sustainable business school in Amsterdam.

Giving back

As KPMG, we take a responsible approach to the environment. By offsetting our emissions, we have been carbon neutral now for more than ten years. Our goal is to be net zero by 2030, in part by encouraging more employees to use bicycles, electric cars or public transport. In 2020/2021, our net CO2 emissions – after subtracting renewable energy – totalled 3,629 tonnes, down nearly 60% compared with 2019/2020 due mainly to the impact of Covid-19 (which resulted in office closures and less business travel). Gross emissions are shown below.

CO2 emissions 

Emissions (tCO2e: tonnes, CO2 equivalent) [1]

2020/2021

2019/2020

   

Scope 1

Natural gas used[3]

114

133

Leased vehicles – diesel[2]

279

1,063

Leased vehicles – petrol[2]

2,927

4,727

Total scope 1

3,320

5,923

Scope 2

Purchased electricity – non-renewable[3]

37

47

Purchased electricity – renewable[3]

1,528

1,658

Leased vehicles - electric[2]

98

74

Total scope 2

1,663

1,779

Scope 3

Rail travel

10

103

Air travel

160

2,743

Total waste (includes recycled water)

1

1

Recycled waste

86%

89%

Water used[3]

3

3

Total scope 3

174

2,850

Total gross emissions

5,157

8,894

Net CO2 emissions

3,629

7.236

  • 1 Emissions are measured using the Greenhouse Gas Protocol.  
  • 2 Cars owned privately by KPMG employees are not included in the table above.  
  • 3 Figures for natural gas, purchased electricity (both renewables and non-renewables) and water usage are given for the calendar year.

Brand value

In 2021, KPMG was again ranked the second most valuable Dutch brand (behind Shell). According to Brand Finance, however, the value of our brand fell by just over 20%, returning to its pre-pandemic level. Strong scores on innovation and use of technology were offset by a decline in well-being, an issue which has gained in importance during the Covid-19 pandemic. Read more about our approach to wellbeing in the People section. Through our regular client satisfaction surveys, we also measure brand attributes – whether clients recognise these attributes in their work with us. In the latest survey – for the first half of 2021 – 97% of clients said our five brand attributes[4] either ‘fitted well’ or ‘mostly fitted’ their experience of KPMG.

  • 1 Based on feedback from the AFM's review of three separate KPMG engagements. Communication from the AFM on these reviews can be found on their website.
  • 2 In this report we use the term PIE (Public Interest Entity) when we refer to the Dutch 'OOB' (Organisatie van Openbaar Belang). PIE should thefore be read as Public Interest Entity according to Dutch Law. 
  • 3 Under the Greenhouse Gas Protocol, scope 1 relates to direct emissions from KPMG’s own business operations; scope 2 to indirect emissions from the use of purchased energy; and scope 3 to emissions from the firm's value chain (i.e. emissions from clients, suppliers and other business partners in the course of their business with KPMG).
  • 4 Our five brand attributes are: Expert, Global mindset, Forward-thinking, Value-adding and Passionate.