For a man who’s at the top of his game, John Griffith-Jones can sometimes
appear to contradict himself. ‘At least I feel so far, so good, as opposed to
coming in from the outside on the crest of a wave or whatever. Not that I think
it’s the crest of a wave, but just that feeling that it is a hard act to follow.
But in truth it is a hard act to follow.’
Clear? Let’s say he is ambitious for the firm. ‘By the time I finish here I
want to hand it over so that my successor has got an even tougher job than I’ve
He will step into the shoes of long-standing KPMG chief Mike Rake on 1
Griffith-Jones, who has been with the firm 31 years (just six short of his
soon-to-be predecessor’s stretch), is not oblivious to Rake’s successes – but he
doesn’t appear intimidated by them either.
‘He was the boss, there’s no doubt about that. But we were a team and I did
almost all of the day-to-day management stuff. So I feel like the success of the
past four years has been something that we did together, rather than still
thinking, “Oh my god, I’ve got to beat that.”’
Judging by his confidence and ease of manner, by-products, no doubt, of his
Eton education and time as a Royal Green Jacket, Griffith-Jones seems
well-qualified for the job.
He is aware that his biggest challenge in heading up the firm is to tackle
the issues of the modern day that face both his firm and his clients.
But Griffith-Jones has a plan, which is to get people arguing. He wants to
ensure the firm is a place in which people feel comfortable enough to debate. ‘I
think I like a bit of an argument more than [Rake] does. I think it’s really
good to have an argument about a big decision. The most senior person in the
room is by no means always right.
‘I like to have someone to challenge me, or to be challenged by,’ he says.
‘But you can only do that if everyone feels safe. It relies on everyone sitting
in on the meeting, not keeping quiet,’ he argues.
It is this quality that Griffith-Jones feels he will bring to the
organisation – a ‘slight difference in style’ he calls it. ‘I’m very much a
people person. It’s important to understanding what the other person is
thinking. It’s more important than trying to persuade them about what you’re
thinking, because if you don’t understand why they’re not doing things, you’ll
never make progress in persuading them to change their mind and go along with
the project,’ he explains.
These ideas tie in with what he sees are key priorities in developing the
business. Today the audit profession must keep up in a rapid-paced,
technology-driven world, with ever-increasing automation. ‘What iPod did to
compact discs is evidence of big shifts in the technology and economic power
balance. We are a very high-cost economy in the UK, so we need to be on our toes
in this marketplace to make sure that the total product range and technical
services we are providing our clients with are leading edge,’ he says.
On the non-audit side, which comprises two-thirds of the firm’s £1.2bn
revenues, competition remains stiff. Ability to adapt is a cornerstone of his
strategy for the firm. ‘What we sell a lot of this year we may be selling none
of next year. So you need [to be in top of] the next thing. We don’t invent
products, but we need to be alert to whatever the collective issues are facing
our client base, to work out how we can quickly help them solve whatever issues
they may have.’
Evolution, not revolution, is Griffith-Jones’ priority. The best way to
evolve is to attract the best graduates, to show them KPMG is the best place to
work. In those stakes the firm’s on the right track. ‘We do want to do well on
the people front. We are very proud of our people tradition.’
KPMG topped the Sunday Times’ Best Big Companies To Work For list for 2006,
based on interviews with 1,000 of the firm’s employees. The quality of staff and
the value attached to working at KPMG are high on Griffith-Jones’ agenda.
‘You cannot run a service sweatshop and get away with it indefinitely in the
21st century. You have got to run a place which is genuinely the best place for
them to work,’ he says. ‘It’s like bottling wine. You get a good vintage, and
once you have got it, no one else can get it.’
Third in line
Perhaps he is not revealing his true thoughts when he says that he doesn’t
want to compete with his Big Four rivals for taking the number two spot. This
would involve making up £70m in income fees, on comparable figures.
‘The gap is tantalisingly small and that amuses us. Being number three and
actually chasing is quite fun. You’d have to ask John Connolly (Deloitte senior
partner and chief executive) whether being number two and being chased is as
much fun,’ he says.
KPMG isn’t in fact that bothered with size at all, or so Griffith-Jones would
have us believe. ‘It’s a great sort of spur to action. But the reality is that
size for size sake is not what we’re about. If I was compulsively passionate
about overtaking Deloitte, I would go back into legal services, merge with a
medium-sized firm with a turnover of £100m, and, hey presto! I’d overtake
That does not mean he hasn’t thought about the possibility of taking the
number two spot, the key to which he says would be clients as well as staff. He
plans to ensure his clients feel the same way about KPMG as its employees. ‘If
we succeed that, then it is logical to assume that we will tend to grow faster
than the others, because if you are the best, then people will use you more. But
I’m not playing the game of I’ve got to be top-dog,’ he says.
In the meantime, he has bigger fish to fry in maintaining and promoting the
UK in global capital markets. No small challenge, but one in which he
acknowledges is not his job alone. ‘We’re a small cog in a rather successful
machine which is the City of London.
Therefore, it is in our interest that the machine continues to flourish. That
goes hand in hand with the Companies Act, IFRS, FSA, what the Americans do
around Sarbanes-Oxley, and the politics of persuading the Indians, Arabs,
Chinese and Russians that London is a safe place to keep their money and an
honourable place in which to do business,’ he says.
The issue is a question of honour for Griffith-Jones, considering it was his
profession that somewhat tainted business confidence following Enron. Since
2001, regulators around the world have put in place a variety of measures to
safeguard against corporate fraud, but new legislation here has stalled on
several key points. In particular, the profession is concerned over the proposed
clause on the ‘reckless audit report’ contained in the bill.
Griffith-Jones says: ‘If people commit what society regards as a criminal
act, they should be punished, and auditors should be no different from anybody
else. To my mind, there’s a difference between negligently making a mistake and
conniving in hiding the truth.’
Whether lawyers are able to argue the clause in or out of the final
legislation remains to be seen. ‘But if they nail people who make genuine
mistakes, they will damage the profession in the medium term,’ he says.
Audit quality remains a priority for all of the Big Four. Griffith-Jones’
challenge is to make sure the firm stands out from the others. Part of this
could see a higher offering of non-audit services from the firm, in line with
his ideas on innovation and meeting client needs outside of standard auditing.
‘Evolution rather than revolution,’ he repeats.
‘And if we get this right, we certainly will be bigger and hopefully better
than the others.’ Does this mark a clear point of change for KPMG? Watch this
• On pet hates: People arguing from a point of self-interest and
unsustainable arguments; people being over-defensive.
• On technology while on holidays: I turn my BlackBerry on about once a day.
But I go dinghy sailing on holiday, so luckily they haven’t yet invented a
• On work/life balance: My wife would say my work-life balance is ridiculous.
But I don’t take papers home from the office. I get in to work otherwise at
8.30am and leave at about 7pm. And I attend about two functions a week.
• On his career to-do list: I don’t have a list. When I want to do something,
I get it done. I’m very determined and I can be quite persistent. I’ve never had
a 20-year view and now it’s too late.
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