PwC seeks to limit pain
PwC Australia CEO Tom Seymour has stepped down from his position amidst a tax leak scandal that continues to plague the firm.
Seymour’s departure came after discussions with the PwC Australia Board of Partners, which agreed that it was in the best interests of the firm and its stakeholders.
The firm has appointed its assurance leader, Kristin Stubbins, as acting CEO while it elects a new CEO in the coming months.
The scandal began in January when it emerged that former partner, Peter Collins, had been banned by the Tax Practitioners Board for leaking confidential government tax plans, which included new rules to stop multinationals from avoiding tax, to other staff and partners at the firm.
Last week, internal emails sent by Collins were revealed in public documents during a parliamentary inquiry, adding to the pressure on PwC.
Seymour admitted that he was one of the partners who had received the information and said that the emails did not contain breaches of confidentiality, but demonstrated a “cultural problem at the time.”
The information had spearheaded a push for new business for PwC.
The scandal has angered the federal government, a key client of PwC, with Treasurer Jim Chalmers expressing his fury in January and threatening further action against the firm if necessary.
The fallout from the scandal is growing, with the Greens and integrity experts urging the Commonwealth anti-corruption commission to investigate the matter, while Treasury reviews whether a criminal investigation should be pursued.
Greens Senator Barbara Pocock said she would refer PwC and its former partner Peter Collins to the new National Anti-Corruption Commission (NACC) when it starts operations to scrutinise his leak of sensitive government plans to combat tax avoidance. The planned changes were marketed to multinationals that would be affected.
“Corruption on this scale is what NACC is for,” Senator Pocock said in a statement.
“This matter should be top of its agenda when it opens for business on 1st July.”
Treasury says it is still deciding whether to refer the matter to the Australian Federal Police in light of damning evidence of misconduct that was made public last week.
Former NSW Supreme Court justice Anthony Whealy, KC, now the chair of the Centre for Public Integrity, notes that the federal anti-corruption legislation could catch government contractors, such as PwC, and operate retrospectively.
Geoffrey Watson, SC, a director at the Centre for Public Integrity, said it was impossible to know whether Collins and PwC’s conduct was covered by anti-corruption legislation without knowing their exact relationship to the government.
However, he stated that “if this kind of conduct isn’t covered by the NACC, it’s the first clear instance where the legislation is inadequate to deal with all necessary circumstances”.
The scandal has resulted in the resignation of three of PwC Australia’s senior executives, although they remain in senior positions at PwC.