KPMG UK has appointed its first female leaders in its 150-year history, replacing boss Bill Michael who was forced to step aside.

Bina Mehta has been asked to step in as acting chairman and Mary O'Connor will take over Michael's day-to-day executive responsibilities as acting senior partner. It is the first time in KPMG’s 150-year history that either role has been held by a woman. 

Michael faces an investigation over alleged offensive remarks he made.He reportedly told consultants to "stop moaning" about the pandemic's impact. Michael has stepped aside while the investigation is carried out into his alleged comments made during an online meeting on Monday.

It has also been reported that he told staff to stop "playing the victim card" dismissing staff concerns about job stress during COVID-19.

He later apologized, saying the comments did not reflect his beliefs. Michael has run KPMG UK since 2017 as chairman and senior partner.

The accounting giant, which employs more than 220,000 people globally, immediately began an "independent investigation" which will be carried out by law firm Linklaters. 

His remarks triggered angry responses from some staff on an app used to post comments anonymously during the meeting.

Current and former KPMG insiders said they thought it was unlikely that Michael would return as Chairman, according to a report in the Financial Times. Michael, who was hospitalized with COVID-19 last year, was paid £1.7m in 2020, KPMG UK revealed last week.

The firm is also poised to tell staff that it will overhaul its unpopular performance rating system whereby employees are ranked according to a “forced distribution curve”. KPMG said its executive board decided to move away from a “fixed” distribution model at the end of January, instead of moving towards a more flexible system that will allow managers to assign more top ratings within their teams. 

The change will go some way towards boosting morale within KPMG’s 19,000-strong workforce, with several insiders saying they were shocked, disappointed, or upset by this week’s events.