The global leadership’s intervention in the Australian firm is a sign of how serious the matter has become, and the danger the leaks saga poses to the firm’s global brand and relationship with clients around the world.
Diana Weiss, Global General Counsel PwC
The tax leaks saga began in January, when the Financial Review revealed that the Tax Practitioners Board, which regulates the country’s tax agents, had terminated the registration of former PwC tax partner Peter Collins for the unauthorised sharing of confidential information about the government’s tax plans with other partners and staff.
The board also ordered the firm to run additional training about managing conflicts of interest.
Last Tuesday, the Senate published a cache of internal PwC emails that showed exchanges between more than 50 redacted email addresses, discussing a marketing project to target US tech companies and offering a “work plan” to deal with new tax laws for which Mr Collins was providing advice to Treasury.
The emails also revealed PwC ended up charging $2.5 million in fees to advise 14 clients how to sidestep new tax avoidance laws in 2016, relying on the confidential information.
On Monday, assurance partner Kristin Stubbins was installed as acting CEO leader of the Australian firm after Mr Seymour stepped down.
On Wednesday, senior partners Pete Calleja and Sean Gregory also stood down from their leadership positions at the firm.
PwC’s Peter Collins and Tom Seymour at the Senate inquiry into corporate tax avoidance in 2015.
A PwC source earlier said Mr Calleja felt it was appropriate to step down from his role ahead of the Senate inquiry, while Mr Gregory, who the source said was not involved in the matter, stepped down as he was the leader responsible for risk management at the firm.
Ms Stubbins has appointed partner Rob Silverwood to lead the financial advisory business and partner Tony O’Malley to take on a new role of chief risk and ethics leader. Another partner, Nicole Salimbini, will lead a response plan for creating better governance and structures.
“We deeply regret that we have failed the high standards we set for ourselves as an organisation,” Ms Stubbins said in a statement.
“We now need to re-earn trust, which is why we have taken appropriate action, including the announcement that we will establish an independent review, in relation to our governance, accountability and culture.”