‘Shadow’ culture of profit first blamed for PwC tax leaks scandal
A scathing report into PwC Australia has blamed a “shadow” culture which tolerated bad behaviour in the pursuit of profit “growth at all costs” and lack of governance that “went unexamined and uncorrected for many years” that led to the firm’s tax leaks scandal.
The review, by former Telstra chief executive Ziggy Switkowski, laid bare the brutal, uncompromising culture at the top of the big four accounting firm, which had become an unaccountable boys’ club with an all-powerful CEO who could not be challenged.
PwC Australia boss Kevin Burrowes and PwC global chairman Bob Moritz.
Dr Switkowski made 23 recommendations to reform PwC, including adding independent members to the firm’s governance board, giving that board the power to fire the CEO, changing the way partners are rewarded, overhauling the firms weak risk management systems and fixing a culture where “revenue is king” and rainmakers who were described as “untouchables” to whom “the rules [didn’t] always apply”.
The firm has agreed to all the recommendations in the report that was released on Wednesday, and will also, in a first for a big four accounting firm, publish audited financial statements from 2025.
PwC Australia chief executive Kevin Burrowes hopes the response to the report will put a line under a crisis that has, in the words of Switkowski led to a “brutal unravelling of that trust” in the once-dominant accounting and consulting outfit.
“The report highlights that we’ve had failure of leadership, by individuals and by the firm, and that’s really difficult and disappointing to read, if I’m honest with you,” said Mr Burrowes, the senior partner who was parachuted into the role by PwC global in an effective takeover of the local firm.
“And obviously,
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