A group claiming to be current and former PwC partners in Australia have ridiculed the firm’s response to a damaging tax scandal as “grossly inadequate” and demanded more transparency and accountability.
The anonymous letter, signed by a group calling themselves “the committee to restore trust in PwC through transparency and accountability” was sent to the acting chief executive, Kristin Stubbins, on Monday morning, one day after the firm announced it would divest its government services.
“The purpose of this correspondence is to express our deep concerns regarding the current course of action, the proposed plan and the timeline known to us,” the letter said.
“We find it lacking in transparency, grossly inadequate, and potentially detrimental to the firm beyond repair. Urgent corrective measures must be undertaken to salvage our partnership from further disaster.”
The group argues the divestment of PwC’s government work to Allegro Funds for $1 “exhibits significant deficiencies and fails to subject various pertinent matters to the necessary scrutiny required to meet community standards”.
PwC declined to comment on the letter.
On Monday, Stubbins told a parliamentary inquiry that everyone involved in the misuse of confidential government tax plans would be publicly named, once an investigation was completed, and those on the list would not be allowed to transfer to the new company.
“We will make sure that all staff and partners included in that transaction have not done the wrong thing,” Stubbins said. “Anyone who has done the wrong thing, when we complete our investigation, will be announced and those people will not be going across.”
The chair of PwC’s governance board, Justin Carroll, said the divestment was an “extremely difficult decision” that was necessary to protect jobs and regain trust after a confidentiality scandal damaged the firm’s reputation and revenue.
The letter said the financial damage caused by the scandal would affect the livelihoods of many partners and staff who were unaware of the scandal and complied with ethical and legal responsibilities.
“We have experienced total losses of government-related revenue. The firm’s reputation has suffered irreparable harm, resulting in substantial revenue loss of client revenue,” the letter said.
“We face challenges in retaining and recruiting high-quality partners and staff. All of which will translate into billions of dollars lost.
“These events will directly impact the lifetime earnings of all current and future partners for the next 25 years. It is neither fair, just, nor right that the partners directly responsible for these events, including their oversight and leadership of our firm, continue to benefit in any capacity.”
The letter argued it was “naive, arrogant and insulting” to claim that only those who were mentioned or featured in emails discussing the confidential information were responsible.
“Punishing only those named in the email or directly involved in the tax scheme would be woefully inadequate and an attempt by the firm to shield those ultimately responsible,” the letter said.
“The breadth of responsible parties who have placed our esteemed firm in this position is extensive, and each must face significant consequences for their actions or inactions.”
The Greens senator Barbara Pocock, who sits on a parliamentary committee examining PwC’s conduct, said government departments should continue to view the firm and any spinoff cautiously.
“We need more than verbal assurances,” Pocock told the ABC. “The government needs to be confident that the practices, the protocols and the leadership really understand what government expect from them.
“We have a fair distance to travel with some very significant procedures under way through the Australian federal police and a range of inquiries and a mere change in structure and leadership doesn’t deliver what is really needed here.”
