PWC Australia staff face ‘severe’ fallout over tax leak, MPs told
A legal probe will conclude ‘shortly’ and the firm will name any staff found to have ‘done anything wrong’, acting CEO says
Sydney — PwC Australia staff who are found to have acted improperly in a scandal over the leaking of government tax plans will face “severe” consequences, acting CEO Kristin Stubbins told a state parliament inquiry on Monday.
In her first public appearance since her predecessor resigned over his involvement in the scandal, Stubbins said an investigation by two law firms will conclude “shortly” and the firm will name any staff found to have “done anything wrong”.
“We have failed the standards we set for ourselves as an organisation, and I apologise on behalf of our firm,” Stubbins said.
PwC Australia is under fire after a former partner who was advising the federal government on laws to prevent corporate tax avoidance shared confidential information with colleagues who then used it to pitch to multinational companies for work.
The firm has already placed nine partners on leave and named four former partners directly involved in the breach who have since left the firm. Two of those four have publicly denied any wrongdoing.
Stubbins faced a New South Wales state parliamentary inquiry a day after the firm announced plans to sell its government consulting business for A$1 ($0.67) and a further leadership shake-up as it responds to a scandal that has led government agencies and major pension funds to freeze work with PwC.
PwC’s initial decision in May to ringfence its government consulting practice and set up a separate board “didn’t go far enough”, said Stubbins. PwC Australia would receive no financial benefit from the A$1 sale, she added.
About 1,500 staff and more than 100 partners will go across to the new entity, which will be set up as a corporation with the help of private equity firm Allegro Funds and launched in about September.
The move will cut PwC Australia off from the “vast majority” of public sector consulting work, though some external audit work for government clients may stay, said Stubbins.
Stubbins took over from former CEO David Seymour in May after he admitted he was one of at least 67 staff who received emails containing confidential government plans to curb multinational tax avoidance leaked by a former partner at the firm between 2014 and 2017.
She will remain in the role until Kevin Burrowes, now global clients & industries lead based in Singapore, relocates to Australia for the job.
Reuters