Dr Ziggy Switkowski will lead the investigation into PricewaterhouseCoopers. Photo: RMIT.
Former Telstra boss Ziggy Switkowski is leading a high-level inquiry into PricewaterhouseCoopers’ culture and business practices in the widening wake of the consulting giant’s breach of trust while advising the federal government.
On Monday (15 May), PwC announced that Dr Switkowski will head an “independent review of the firm’s governance, accountability and culture” and that an internal move has created the role of chief risk and ethics leader for PwC Australia.
Tony O’Malley, PwC’s global legal business solutions leader, takes up that appointment effective immediately.
PwC flagged the establishment of a review last week in a bid to contain the ongoing fallout from a partner sharing confidential tax policy information across the firm and, by extension, to clients.
Former PwC partner Peter-John Collins lost his registration as a tax agent for two years after a Tax Practitioners Board investigation found him guilty of integrity breaches.
The TPB investigation began shortly after Mr Collins left PwC in October last year.
It revealed that while a partner of PwC, Mr Collins was part of a confidential Treasury consultation about improving tax laws in an effort to stop multinational tax avoidance.
The TPB found Mr Collins made unauthorised disclosures of this confidential law reform information and, in so doing, failed to act with integrity, as required under his professional, ethical and legal obligations.
The scandal sparked an ongoing senate inquiry into the ethics and accountability of consultancy firms working in the Australian Public Service.
Greens Senator Barbara Pocock, who instigated the senate inquiry, said all Big Four consultancy firms – PwC, Deloitte, KPMG and EY – should be thoroughly examined, with the view of curtailing their involvement in confidential government briefings.
“Sharing details of proposals to rein in tax avoidance with firms like these, whose employees then behave unethically, is like putting the fox in charge of the henhouse,” Senator Pocock said.
“What confidence can taxpayers have that conflicts of interest like these are not widespread?”
The PwC breach has already claimed the scalp of former CEO Tom Seymour. Photo: PwC.
PwC’s chief executive officer Tom Seymour resigned his post last week, with the firm announcing this week that the now-former CEO will retire from his partnership on 30 September.
Dr Switkowski will now consider how PwC Australia applies professional values and ethical standards across its work.
His review will examine how decisions are made and overseen within PwC, including how financial goals, values and strategic objectives are balanced and prioritised.
In a statement, PwC said Dr Switkowski will examine how the firm’s partners and staff are held accountable for their responsibilities.
More heads could roll as a result of the review.
Acting CEO Kristin Stubbins said PwC will not hesitate to take the recommended actions, including “exiting further people and partners” from the firm where appropriate.
“We are committed to learning from our mistakes and ensuring that we embrace the high standards of governance, culture and accountability that our people, clients and external stakeholders rightly expect,” she said.
“Dr Switkowski will have access to all the people and information he needs to conduct a rigorous and robust review.
“We look forward to receiving his report and acting swiftly on its recommendations.”
Dr Switkowski is already on the case and has been asked to report his key findings and recommendations in September.
When complete, PwC Australia will share a summary of his key recommendations.
Mr O’Malley will have responsibility for all aspects of ethics and compliance at the firm and will help lead the implementation of the external review’s findings.
Last week, Labor Senator Deborah O’Neill delivered a brutal assessment of the PwC breach, saying it was a “deception of the Australian parliament, the Australian people and a betrayal of the ethical and professional standards” consultancies working in government should be upholding.
“This is a major cancer on the way that information that is vital to the national interest is being undertaken by those at PwC,” Senator O’Neill said.
“There are many more questions than answers, and I will not let this go, in the interests of the nation.”
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