Macquarie Group Record Profit, Same-Day CEO Exit|Boards Own Auditor Now Under Enquiry

A Record Handover, On Paper

Macquarie Group has confirmed that chief executive Shemara Wikramanayake will retire on the sixth of November, ending an almost forty-year career at the firm. Her successor is Greg Ward, the current head of banking and financial services, who has worked alongside her for three decades. The board is presenting this as continuity rather than disruption, timed against a share price sitting near a record high.

Under Wikramanayake, Macquarie delivered a total shareholder return of one hundred and ninety two percent, comfortably ahead of both the banking sector index and the broader ASX 200. Full-year net profit rose thirty percent to four point eight five billion dollars, with a record second half. On the numbers alone, this looks like a chief executive handing over a business at its peak.

But the succession announcement was not the only news out of Macquarie's annual general meeting. On the same day, chair Glenn Stevens confirmed the board had commenced a formal enquiry into KPMG, the firm Macquarie itself selected as its incoming external auditor. The question is not about Wikramanayake's record. It is about whether the board's own governance judgment can be trusted at the exact moment it hands the keys to someone else.

The Boardroom Confrontation

The enquiry follows a whistleblower allegation that KPMG misused client information to help win the audit tender. Macquarie's own tender process had narrowed the field down to a final choice between the incumbent, PwC, and the eventual winner, KPMG, after Deloitte and EY were eliminated earlier.

Activist shareholder Stephen Mayne pressed the board directly at the AGM, arguing that narrowing the process to PwC versus KPMG so early is what opened the door to the conflict-of-interest allegations in the first place. He pointed to Macquarie director Michelle Hinchliffe, a former KPMG partner, and the seventy five million dollars a year in business the group had awarded her former employer.

Chair Glenn Stevens pushed back in the room, insisting the tender was run to seek the best offer and that PwC remained genuinely in contention throughout. He stated plainly that none of the reputational problems facing the big four firms were related to audit quality or integrity, and that the board unanimously recommended KPMG. Two named parties, looking at the same tender process, reached opposite conclusions about what it proves.

This is not a new question the board is fielding for the first time. At last year's AGM, Stevens dismissed scrutiny of the KPMG contract as silly talk. Twelve months later, that same question has escalated into a formal enquiry, with an external review by law firm Allens commissioned under terms Macquarie itself agreed. The board's own credibility on governance judgment is what is actually being tested here, not KPMG's.

What Ward Actually Inherits

The KPMG dispute does not stand alone. Compliance failures have been accumulating at Macquarie for some time. More than a quarter of investors voted against executive pay last year, and staff at the investment bank have separately accused a handful of managers of bullying and other transgressions.

Underneath the record headline profit, return on equity has improved to fourteen percent but still sits below the mid to upper teens the bank used to generate routinely. Macquarie now trades at two point six times book value, a discount to Goldman Sachs and Morgan Stanley, who have pulled ahead toward three times. The market volatility from the Iran war helped this year's bottom line, but that is a tailwind, not a structural fix.

Stevens himself acknowledged at the same AGM that remediation work for past regulatory and compliance shortcomings continues, even as he highlighted progress on platform and data upgrades. Greg Ward is not just inheriting a business at a record share price. He is inheriting the unfinished remediation, the pay-vote dissent, and now an active audit-integrity question, all under his own name from day one.

The Checkpoint Before November

The clock on this is shorter than it looks. Ward formally joins the board on the seventh of November, and KPMG's own appointment as auditor is subject to regulatory consent and a shareholder vote at next year's AGM, with the audit itself not starting until the beginning of financial year twenty eight.

That gives a clean discriminator. If the Allens review clears the tender process of conflict, the seamless-succession framing survives largely intact, and the KPMG question fades into a footnote on Wikramanayake's record. If the review finds the process was compromised, Ward inherits a board decision he did not make and a shareholder vote next year that could reopen the entire auditor choice, before his tenure has properly begun.

For existing holders, the variable to watch is not the December profit print but the outcome of the Allens review itself, since that is what actually tests whether the governance judgment behind this record run can be trusted going forward. For anyone on the sidelines, the trigger is next year's shareholder vote on formally engaging KPMG. A clean review and a smooth vote turn this into a well-earned handover. A contested one turns Ward's opening chapter into a governance crisis he did not create but now has to own.