PwC partners step up calls for reform and leadership purge

In the original letter sent by the group on Monday, and first reported in The Guardian, the partners addressed their concerns to senior PwC managers including global chairman Robert Moritz and US chairman Tim Ryan.

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PwC declined to comment about the group, which has been contacting the media – including this publication – and politicians about the scandal, under the condition of anonymity due to fears of repercussions from the firm.

The group of partners said that two former PwC chief executives – Tom Seymour, who is retiring from the firm, and Luke Sayers, who now runs his own consulting group and is president of the Carlton Football Club – should be held accountable for the scandal.

Sayers’ associates say he had no knowledge of the scandal.

Seymour stood down as chief executive in May and was replaced by Kristin Stubbins, who is now being replaced by Singapore-based Kevin Burrowes after the global firm effectively took over the troubled local operations last week.

Stubbins told a NSW parliament inquiry on Monday that the firm will soon complete the investigation by the two law firms looking into the scandal.

“We have been doing a very, very thorough investigation involving help from two external law firms. And so we will expect to announce consequences, you will see that publicly, and they will be severe,” she said in her first public appearance since taking the top job last month.

However, the group of PwC partners said more radical reforms are needed to save PwC. The group said in their letter on Monday that senior staff who have presided over the scandal should be fired and forfeit lucrative retirement payments.

They are also pushing the firm to install an independent board, remove all current partners from external company boards, and not do business with clients that have former PwC staff on their boards. They also want PwC to explore selling off, or dissolving its tax business.

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So far, PwC has revealed the names of four partners mentioned in the cache of emails sharing the confidential information on government plans to combat tax avoidance.

PwC announced plans on Sunday to offload its entire government business to a private equity group Allegro, after its plans to ringfence the business as part of a plan to avoid conflicts with its private sector business proved inadequate.

This week, the Department of Health and Aged Care confirmed that they have suspended a contract with PwC while it allays concerns about potential conflicts. It is the first time that a government department has suspended current work with PwC, as opposed to freezing the firm out of future contracts.

”PwC was conducting an audit of the aged care workforce bonus grant … The audit was suspended in early June 2023, to obtain additional information and assurances from PwC,” said a spokesman for the department.

“The grant program itself did not involve PwC and was already complete, so workers are not affected.”

In a sign of just how financially damaging the scandal has already become, PwC told its partners this week that it is forecasting that their income pool will drop by roughly 20 per cent for the 2024 financial year starting July 1.

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