A Corporate Future for Reconciliation

In this week's Executive Insight, Head of Corporate Citizenship at KPMG Australia, Catherine Hunter, speaks about the firm's Reconciliation Action Plan and how business can show leadership on politically-sensitive issues. 

In the last decade, reconciliation has emerged as a key issue on the Australian corporate radar, extending the fight to improve outcomes for indigenous Australians into boardrooms and offices nationwide.

Increasingly, Australian corporations are formalising their commitments to indigenous Australians through Reconciliation Action Plans (RAP) – public statements made by the organisation outlining the actions it will undertake, within its sphere of influence, in the national effort to close the gap between Indigenous and non-Indigenous Australians.

In 2009, KPMG became the first major accounting firm to have a RAP endorsed by Reconciliation Australia. Their 2013-2015 RAP focuses on supporting social and economic development, recognising and promoting the rights of Indigenous Australians.

The RAP was informed by the UNGC’s Guiding Principles and the UN Declaration on the Rights of Indigenous Peoples and KPMG Australia is a founding member of the United Nations Global Compact (UNGC) in Australia, with the firm’s Head of Corporate Citizenship, Catherine Hunter, currently chairing the network.

Pro Bono Australia News spoke to Hunter about KPMG’s RAP, the company’s Australian-first efforts to measure its impact, and how the business navigates the political sensitivities around indigenous issues.

Shaping the RAP

KPMG first took steps towards supporting reconciliation in 2006 and released its first RAP in 2009. That same year, the firm was a founding member of  the Australian Indigenous Minority Supplier Council, and established an internal Reconciliation Working Group including members from within the firm and their Indigenous friends and colleagues.

“For an Australian firm that’s also a part of a global network, we wanted to turn our minds to some of the most pressing issues facing Australia…[considering our] reputation globally with the inequality for our first Australians – at that point expressed by a more than 10 year gap in life expectancy,” Hunter said.

The types of reconciliation strategies in the firm’s RAP are diverse, including:

• Procuring goods and services from Indigenous business

• Developing Indigenous cultural awareness among partners and staff

• Assisting Indigenous Not for Profit organisations

• Supporting the campaign for the Constitutional Recognition of Indigenous Australians.

“The number one driver for what we do is community impact,” Hunter said. “The position we come from is that it’s the right thing to do. What is it that we can do to better society? The best way we feel we can do that is by using our professional skills.

“It’s a values-based decision in the first instance, but we know it also has measurable, tangible benefits for our business, and for our people.”

“We take a very high number of graduates and have a fairly young average age in the firm, and we know that people joining the firm are actually very openly telling us they’re choosing KPMG as their employer of choice because of our values.”

Valuing the RAP

KPMG has taken steps to capture both the social and economic benefits of its reconciliation strategies. Hunter says she believes KPMG’s RAP is the first in Australia incorporating an assessment of social impact.

The assessment valued the social and economic impact of KPMG’s RAP at $12 million, on an investment of $5 million. That is equivalent to $2.40 in social and economic benefit for every dollar invested.

The main beneficiaries were Indigenous business and communities (53 per cent); with the remaining benefits (47 per cent) being recognised by KPMG and its employees.

“It was a complex and long process. We did a qualitative evaluation, which was a lot of interviews and consultation both internally and with external partners…and then we did an economic analysis as well,” Hunter said.

“The process itself was enormously valuable because what it meant was that we were having those very deep conversations with our partners and our people…we were pausing at a point in time.. It did provide an opportunity to say to our partners, ‘challenge us, and say what we can do better’.

“It surprised us a little how much some of the projects – particularly some of the pro bono and honorary work – was highly valued. We had probably taken that for granted a little bit. It also did provide some further evidence for us where we knew ourselves to be a little bit weak, particularly around indigenous employment which continues to be a challenge for us.

“It gave us some additional evidence to go to the business and say, ‘we thought this intuitively, but this gives us a stronger business case’.”

Navigating Political Sensitivities

According to Hunter, the humans rights lens the company applies to many of its activities sees it frame issues that are arguably politically sensitive as merely essential steps in recognising the rights of Indigenous Australians.

“Interestingly, we saw constitutional recognition as a non-political issue because it had bipartisan support, while other businesses saw it as highly political,” Hunter says.

“I think it’s naive to say it’s not political because clearly it is, but we do see in principle bipartisan support.  

“We certainly don’t want to be instructing people in our firm how to vote should there be a referendum. What we want to say as an organisation, in principle, is that we absolutely agree we should be acknowledging our first Australians in our founding documents because recognitions is a key ingredient in reconciliation.”

Part of the process is enabling Indigenous communities themselves to be heard, Hunter said.  

“We’re very fortunate to have some great and trusted relationships with indigenous leaders, and a lot of them have different views,” she said.

“The challenges for Indigenous Australia, even at times where they can be unified, is that it’s difficult to be heard, making up only three per cent of the population…it’s one of the challenges perhaps unique to Australia’s indigenous population relative to other minority indigenous populations around the world.  

“Sometimes we don’t see our role as necessarily taking a position, our role is simply to enable, and support and empower those communities we’re working with so they can have a voice.”

KPMG is able to lead by example and work to help Government on key issues, Hunter says.

“Through the Diversity Council Australia and the Indigenous Task Force we participate in, that’s a good opportunity to collectively, as a business group, advocate on behalf of some issues in regards to certain things like the Forrest Review…and other [issues] which we were an early adopter and advocate for, like purchasing and procuring from indigenous suppliers.  

“Indigenous procurement is a very tangible and immediate action that any business can take to support economic empowerment for Indigenous business.

“Government is a key client of ours, they support us and we do work to support them… we can support them in their great work [on reconciliation].”

Leveraging Corporate Australia

Hunter is an advocate for a human rights-based approach and hopes other Australian corporates will continue to recognise its importance.

“If we can demystify a rights-based approach for companies it doesn’t need to be a scary thing,” she said.  

“[Through my role as Chairman at UN Global Compact] we ran a national dialogue on Australian human rights at the Australian Human Rights Commission last year and we saw an unprecedented appetite from corporate Australia to gain a greater understanding of what that means for businesses. I think it’s incredibly encouraging that businesses on the whole are starting to understand.

“A lot of it’s from a risk perspective – that if businesses don’t turn their minds to these issues, it poses great risk…by doing the right thing, businesses also managing the risk for their organisation, which is also a smart economic decision and therefore a strategic business decision.

“At KPMG we contextualise our indigenous engagement through a human rights lens, and it doesn’t need to be scary to take that approach. We see it as a best practice approach.”

Hunter sees reconciliation as a national issue, and one that will require all of corporate Australia to come to the table.  

“[The RAP] is enriching our organisation, it’s enabling us as a firm to contribute in a significant way to something that we do see as a national issue, a national challenge that requires collaboration – for all stakeholders, all businesses.

“We see our competitors engaged in this space and we openly welcome that collaboration because I think the issues are really bigger than any one organisation and we all need to be collaborating.

“Where we can share our learnings with others – which is why we’ve been very open about where we think we can do better – because I think as business when wére happy to be transparent and open about the challenges – that’s where we can often learn the most from one another from one another.

“Looking at global learning about human rights and using some of those UN-endorsed frameworks to guide our work is also enormously valuable because this stuff is tough.

“There’s so much more work to be done but it’s something we’re finding incredibly rewarding along the way.”