Re-thinking purpose and policy on a highly contentious societal issue
“Men on mountain tops (and it’s usually men) shouting through megaphones, does not work anymore”
– Jane McCormick,
Global Head of Tax, KPMG
Responsible Tax for the Common Good
KPMG and Jericho Chambers
KPMG’s tax advisory arm operates in a volatile space. An issue of significant public interest, the tax debate – especially in the UK – drives at the heart of the wider conversation on justice, fairness, globalisation, (in)equality and trust. For KPMG in the UK, a largely conventional and defensive approach to stakeholder engagement and communications around tax and tax policy was not working.. To openly confront tensions in the world of tax, KPMG recognised the need for radical, new forms of engagement, substantive action and more meaningful approaches to policy.
The first phase of the project started in May 2014 with a working group of 14 KPMG partners. They examined bigger, deeper questions around tax: not about how to communicate the firm’s activities, but about the very essence of their operations and responsibilities. What is the purpose of tax? What is the role of tax advisory? Together, building on KPMG’s own Tax Principles and led by Jane McCormick and Chris Morgan, with tax as “the entry fee we all pay for a civilised society”, the group arrived at a hypothesis around Responsible Tax for the Common Good. This became a premise for further scrutiny with external stakeholders – with a series of roundtables and conversations designed to test the thinking – and a catalyst for change in the wider tax community. KPMG deliberately did not seek to control this process. CoVi, an independent UK think-tank, was invited to curate and convene the discussion, privately and then publically.
Essential to an informed, legitimate and adult debate, contributions were invited from tax professionals and the corporate tax community, and also from their most vociferous critics, including Parliamentarians, tax activists and campaigners. The principle here was simple: you cannot learn if you do not listen. Jane McCormick, now Global Head of Tax at KPMG, was quoted in the media as the project unfolded: “at the beginning we were a bit nervous. We were a little worried that some stakeholders might be cynical and unwilling to participate… but we found that there was quickly a mutuality of trust and respect.”
The UK’s Responsible Tax web platform went public in March 2015, itself a commitment to radical transparency. A spectrum of different voices on what responsible tax could look like in the UK became immediately available in the public domain.
Content for the online platform was supplemented by a series of focused events on specific strands of the tax debate: morality, transparency, international competition and the developing world. These included a meeting for Faith Leaders to examine the relationship between faith, trust and business, as well as a Roundtable at the European Commission in Brussels (focused on international competition and cooperation between policymakers) and a CoVi-curated Responsible Tax Big Tent in London where over 120 stakeholders gathered to find common ground and agree better ways forward. The community, from its origins with 14 partners in the summer of 2014, has now grown to over 700 senior stakeholders in the UK alone across a spectrum of views.
Part of the challenge for KPMG involved embracing a new and open process, with no certainty of outcome, which defies corporate convention. Liberated from the usual KPIs, one result of this project has been a powerful generative dialogue around complex issues of tax, based on the exchange and development of new ideas. Responsible Tax for the Common Good has become a meeting place for policymakers, tax experts, professional advisors, activists, campaigners and civil society, a community that continues to expand and engage. A summary of the thinking which emerged from the project together with recommendations can be found in the co-produced think-piece ‘Rebuilding a Social Compact on Responsible Tax’.
Last, but not least, by opening up this space, KPMG found that the most willing participants were the business community, who enthusiastically welcomed the chance to discuss the complex ideas and issues they were facing as part of their everyday corporate tax experience.
KPMG has now elevated the Responsible Tax initiative to a Global level, bringing together policy makers, corporate leaders, tax professionals, media and NGOs to to drive an informed and considered framework for Tax in an increasingly complex global environment.
Robert Phillips & Neal Lawson