Supervisory Board Report

Letter from the Supervisory Board Chairman

We are living in extraordinarily uncertain times. When I joined KPMG N.V’s Supervisory Board, in June 2021, we were still in the midst of the Covid-19 pandemic. At the time, we had high hopes that the pandemic would soon be over and that we would be heading for calmer waters.

Instead, earlier this year, came Russia’s invasion of Ukraine. First and foremost, of course, the war is a tragedy for the people of Ukraine. But it also poses a very real risk to our society. Individuals and businesses must deal with the economic consequences of the war, not least sharply rising energy prices.

The war has also added to a feeling of insecurity, made worse by climate change, and political tensions between the US and China. This feeling of insecurity is evident across our society – it is not just households struggling with the rising cost of living, it is also companies unsure about the future of their businesses.

It is at times like this that KPMG is most needed. There is an opportunity to lead change, not just react to it. Society needs the assurance auditors provide; businesses need advice to help them manage uncertainty, to adapt to higher energy prices or transition to new, more sustainable business models. This applies not just to large multinationals, but also to small and medium-sized companies that make up the backbone of the Dutch economy.

Over the past year, KPMG N.V. has continued to grow, in both Assurance and Advisory, despite economic uncertainty. In Assurance, the firm has won impressive new contracts. Audit quality continues to improve – absolutely vital because it relates to public trust and goes to the heart of the company’s purpose. In Advisory, KPMG N.V. continues to lead the debate in ESG and sustainability.

All this is a testimony to the hard work and dedication of our Board of Management, led by Stephanie Hottenhuis as she embarks on a new, four-year mandate as CEO. It is also evident that KPMG has the right model, combining audit and advisory. As the Supervisory Board, we support management’s determination to retain this multidisciplinary model.

Arguably, the most pressing issue facing the company is talent. It is an issue that is constantly on the agenda of the Supervisory Board. There are skills shortages across the Dutch economy – companies are often competing for the same skills in data analytics, IT and audit. To attract people to work for KPMG N.V., particularly younger people, we need to create the right work environment. That means jobs with a real purpose, a safe and inclusive environment, with a healthy work-life balance and opportunities for development. Over the past year, we have made definite progress in this area – as the Supervisory Board, we welcome that. Retention rates in both Assurance and Advisory remained remarkably high, and last year we took on over 1,500 new recruits including interns, no mean achievement in the current market.

It is one of KPMG’s great strengths that our younger professionals are already able to influence our work. Throughout the company, I often see younger employees eagerly discussing social or environmental issues, looking for ways to change the world for the better. This is a people business – and it is people who will drive KPMG N.V.’s work and the successful execution of its Trust & Growth strategy.

My predecessor, Bernard Wientjes was Chairman for more than six years and was one of the reasons why KPMG has had so much recent success. Over the past twelve months, I and my colleagues on the Supervisory Board have done our best to continue his good work. During the year, we made two appointments to the Board: Linda Hovius and Kuldip Singh will bring experience of leadership, HR and digital, providing an expert view of both the risks and opportunities. Importantly, they will also bring new and different perspectives to our work with management. Finally, I want to express my gratitude to Rob Kreukniet, who stepped down from the Board of Management after seven years, and wish every success to Marc Broskij, his successor as Chief Operating Officer.

Next year will again bring challenges. We will still be living with the appalling effects of Russia’s war in Ukraine, including considerable economic uncertainty. Given that, it is reassuring to see KPMG N.V. enter 2022/2023 in a strong position in both Assurance and Advisory, and with a clear plan as part of Trust & Growth for the coming year. I am confident that all at KPMG N.V. will meet these challenges as they have met the challenges of the past twelve months: with energy, professionalism, commitment and according to the highest standards of integrity.

Roger van Boxtel
Chairman of the KPMG N.V. Supervisory Board