KPMG N.V. is a holding company for our Assurance, Advisory, and Business Services activities. The contents of this chapter relate to KPMG N.V. but also apply to KPMG Accountants N.V. (“Assurance”), KPMG Advisory N.V. (“Advisory”), and KPMG Staffing & Facility Services B.V. (“Business Services”).
All shares in KPMG N.V. are held by Coöperatie KPMG U.A. Our equity partners are members of this cooperative through the practice companies of the individual equity partners. These partners provide services to KPMG N.V. clients under a management agreement with the cooperative. Under Dutch law, Coöperatie KPMG U.A. board members are considered co-policymakers. KPMG Accountants N.V. is a 100% subsidiary of KPMG N.V.
External regulation
The AFM is responsible for overseeing audit firms in the Netherlands. This oversight is based on, among other mechanisms, the following two Acts:
Wet toezicht accountantsorganisaties (Wta; Dutch Audit Firms Supervision Act)
Wet op het accountantsberoep (Wab; Dutch Auditors’ Profession Act)
To operate, all audit firms must have a license from the AFM. KPMG N.V. aims to maintain active, two-way communication with the AFM, which conducts regular inspections of KPMG N.V., as do the PCAOB and the NBA. See the Public trust (new window) chapter of our management review for more information on recent inspections.
In the Netherlands, audit clients classified as PIEs according to Dutch law must change their audit firm at least once every 10 years and their external auditor at least once every five years. In addition, there is a four-year cooling-off period before a former audit firm may be re-hired.
Although KPMG N.V. is not legally required to apply the Dutch Corporate Governance Code ("the Code"), KPMG N.V. voluntarily applies its principles as and where relevant.
At an international level, KPMG N.V. regularly discusses industry matters with the International Forum of Independent Audit Regulators (IFIAR) and representatives from the Committee of European Auditing Oversight Bodies (CEAOB).
Role of the Board of Management and Supervisory Board[1]
We have a two-tier management structure:
Our Board of Management manages the firm. It is responsible for strategy, performance, and value creation.
The work of the Board of Management is overseen by our Supervisory Board, which operates in part through three committees: Assurance Quality, Audit & Risk, and Remuneration & Appointment.
Our Board of Management is made up of four members: the Chief Executive Officer (CEO), the Chief Operating Officer (COO), and the Heads of our Advisory and Assurance businesses.
Our Supervisory Board comprises five members, all of whom are external and independent of the firm's management. All Supervisory Board members are appointed by the shareholder, Coöperatie KPMG U.A. Supervisory Board members are elected for terms of up to four years and may serve no more than two terms, for a maximum of eight consecutive years. Our Supervisory Board members are also considered co-policymakers under the Dutch Audit Firms Supervision Act. Board of Management members are appointed by our Supervisory Board, following approval by KPMG N.V.’s shareholders, the cooperative. For further information, see the Supervisory Board report (new window).
We aim for diversity among the members of both our Board of Management and our Supervisory Board. We believe diversity makes for better long-term decision-making. Diversity is built into the rules of procedure and profile descriptions for both the Board of Management and the Supervisory Board. Under the rules, our aim is to have 50% women on our Supervisory Board and a minimum of 40% women (or, if applicable, 40% men) on the Board of Management. See the Social (new window) chapter of our sustainability statement for more information.
Our Supervisory Board and Board of Management Rules may also be found on the KPMG N.V. website (new window).