The proposed merger, subject to partner votes in both countries, represents the most significant strategic shift since UK chief executive Jon Holt’s appointment in 2021. This move aims enhance profits, which have trailed behind those of its competitors in recent years.

The UK operation of KPMG, employing around 17,000 people, reported revenues of £2.7 billion for the 12 months leading to September 2022, with partners receiving an average payout of £717,000. In contrast, KPMG Switzerland, with 2,600 employees and 145 partners, reported net revenues of 527 million Swiss Francs (around £480m) in its latest financial year.

This merger, if successful, would echo Deloitte’s UK business strategy from 2006, which saw a merger with its Swiss counterpart. It’s notable that KPMG, like other Big Four firms, operates as a network of locally owned partnerships, sharing brand and technology but not pooling profits globally. The firm’s fragmented structure has been a topic of discussion, with industry executives pointing out that it increases costs and complicates the allocation of profits on international projects, the Financial Times reports.

The integration of the UK and Swiss operations could streamline services for multinational clients, especially in high-value cross-border consulting work.

The merger’s final structure is yet to be determined, with partners’ pay possibly reflecting factors such as geography, service line, and revenue generation. Partners from both firms will be consulted in the coming months, with a merger vote anticipated next year.