KPMG has appointed Michael Ebeid as its new chair, a decision met with criticism after emails surfaced showing he previously dismissed whistleblower leak allegations as 'completely false' and described a senator's actions as 'very inappropriate and unfair'. Ebeid apologised for those comments on Thursday, stating he would not have made them had he known the full extent of the firm's shortcomings.
Ebeid's appointment amid ongoing ethical scrutiny
Ebeid took over the role on 19 June after former chair Martin Sheppard resigned under pressure from a parliamentary inquiry into KPMG's ethical failings. The inquiry, led by the Parliamentary Joint Committee on Corporations and Financial Services, has been examining allegations that KPMG staff leaked confidential client information and surveilled a whistleblower's laptop.
Greens Senator Barbara Pocock, a committee member, said Ebeid's appointment 'risks entrenching the very culture and leadership that need to change'. She added: 'This is not the fresh start for KPMG that it attempts to be. Mr Ebeid is a part of the culture and leadership team where things have gone seriously wrong in KPMG.'
Emails reveal Ebeid's earlier stance
The committee released emails on Thursday showing Ebeid's reaction to Senator Deborah O'Neill's speech on 24 March, in which she made the whistleblower allegations public. In an email dated 25 March, Ebeid wrote: 'I assume Senator O'Neil [sic] made no attempt to contact KPMG before speaking … which in itself would be very inappropriate and unfair of her.' He also accused O'Neill of misrepresenting events and said 'many of the statements she makes are completely false'.
Ebeid was one of three independent board members overseeing KPMG's internal investigation into the whistleblower's claims. After the emails were published, Ebeid said he was not aware of 'the full range of facts' at the time. 'I recognise the gravity of the whistleblower's allegations and the shortcomings in the firm's approach at the time,' he said. 'From what I now know … I would not have written that email and am sorry for sending it.'
KPMG admits investigation failures
KPMG has acknowledged that its own investigations, which initially found no evidence of the allegations, were not rigorous enough. After O'Neill's speech, the firm admitted at least three staff had leaked confidential Lendlease and Optus information to colleagues applying for audit contracts at Westpac, Dexus and Telstra. Sheppard had refused to share investigation documents with the committee, claiming legal privilege, but relented after a fiery hearing on 19 June and resigned four days later.
The committee said it published the emails because Ebeid would have an 'important role' in addressing KPMG Australia's integrity issues and rebuilding trust. It also rebuffed Ebeid's suggestion that he knew O'Neill and could meet her, stating that no committee member knows Ebeid or has met him since the allegations were raised.
Pocock accuses Ebeid of inappropriate influence
Pocock went further, claiming Ebeid was trying to 'exercise inappropriate influence on senators and committee processes'. Ebeid responded by saying he respects O'Neill and the committee and will engage constructively with their work. 'I acknowledge the firm got things wrong but we are serious about fixing mistakes that have been made,' he said.
Leadership changes and government response
Earlier on Thursday, in KPMG's statement announcing his appointment, Ebeid said he would accelerate the appointment of a new chief executive and suggested more top staff could be replaced. KPMG's former chief executive, head of audit, and chief operating officer have all stepped down, but there have been calls for further departures. 'The incoming CEO will have a clear mandate to refresh the executive team where required,' Ebeid said.
The federal government has indicated it may consider splitting up the big four consulting and audit firms and capping partner numbers in response to the scandal, avoiding the sweeping reforms it bypassed after the PwC tax leaks in 2023.
