Tuesday, February 06, 2024

PwC opens ethics investigation into Luke Sayers

255 George Street was never as alive as tonight as Rocky and Kim Kardashian invaded Sydney. Kim swung by at 5:23 pm and even Obama did not enjoy as generous police and security escorts as the former lesser-known sidekick of Paris Hilton … Kim was spotted reading the AFR story that is making waves on the Google news 

PwC opens ethics investigation into Luke Sayers

By  Mark Di Stefano

A complaint has raised allegations against the former PwC CEO. The firm’s ethics department has started an investigation.

Well, the attempt from ex-PwC chief executive Luke Sayers to self-extricate himself from the firm and its scandals lasted for less than a week.
The big four consultancy’s ethics department this week opened an internal investigation into Sayers after receiving a complaint that alleged conflicts of interest around the firm’s treatment of businessmen and politicians close to the former chief executive.
The whistleblower complaint has been lodged by someone claiming to be a PwC employee, focusing on allegations Sayers had improperly influenced ASX-listed Helloworld getting PwC’s travel account in 2016.
According to the complaint, the tie-up allegedly gave Sayers access to then-finance minister Mathias Cormann and former treasurer Josh Frydenbergthrough Helloworld CEO Andrew Burnes, who was the treasurer of the federal Liberal Party at the time.
They claim Burnes then became an investor in the Sayers Group, a consulting business set up by Sayers after he left PwC. Sayers declined to comment, while Burnes did not return calls for comment.
This column is not suggesting the allegations in the complaint are true, just that the complaint was made and is now being investigated.
The complaint was sent to PwC’s senior leadership last Monday, which included Kevin Burrowes, the Britbrought in to clean up the joint after the tax scandal brought the firm to its knees.
On Monday afternoon, PwC’s ethics and business conduct leader Valerie Clifford replied to the individual that “an investigation has been commenced”. PwC declined to comment, but did not dispute the veracity of Clifford’s email.

Helloworld and PwC

Many of the claims in the original complaint span Sayers’ whole tenure, and some of the specifics are already matters of public record. They all touch on Sayers’ extensive personal and business network.
PwC had been Helloworld’s long-time auditor. The complaint claims that around 2016, Sayers allegedly interfered in ensuring QBT, a subsidiary of Helloworld, won PwC’s travel account.
They claim this was part of a “preferential relationship” with Burnes, whose Helloworld became the travel sponsor of the Carlton Football Club – where Sayers was club president – and donated to Emotion21, the charity helmed by Luke’s wife, Cate Sayers. In 2021, Frydenberg was named Carlton’s No. 1 ticket-holder.
Burnes and his relationship with senior Liberals was put under the spotlight in 2019 after The Sydney Morning Herald and The Age revealed Helloworld had given Cormann free flights months before the company was given a $1 billion contract from the Finance Department.
The scandal also drew in then-US ambassador Joe Hockey, who was one of the top 20 shareholders in Helloworld.
The complaint claims Burnes became an investor in the Sayers Group, set up in 2020. He wouldn’t be the only one, of course.
During last year’s Senate inquiry into the consulting sector, Sayers said Cormann received equity in Sayers Group in December 2020, one month after the minister quit politics. That has now been relinquished.
While this paints a man elbow-deep with the Liberal Party, it’s worth noting Sayers is equally at home in Labor circles. In his home-town of Melbourne, Sayers is known for his closeness to former premier Daniel Andrews.
A copy of the complaint seen by this column did not include a paper trail or other evidence substantiating the allegations. But the succinct run-down coming from someone claiming to be a PwC staff member clearly was enough to warrant an investigation. The very fact Clifford and her PwC ethics colleagues started a probe suggests they’re not afraid to scrutinise the tenure of the former CEO. Let the sunlight in!
They also cc’d senators Deb O’Neill and Barbara Pocock running the Senate’s consulting inquiry. On Tuesday, O’Neill told this column that the fresh allegations, if proven true, “heighten concerns surrounding Mr Sayers’ complicity in PwC’s conduct during his tenure as CEO”.
This all comes as Sayers bids for an audacious extension to his tenure at the Carlton Football Club. It was during that pitch last week that Sayers brushed off the PwC scandal by saying, “from my personal perspective, I believe that’s completed”.
We understand that Sayers was referring to any further contact with the Senate inquiry.
The PwC ethics department might have something to say about that.
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Mark Di Stefano is Rear Window columnist, based in the Sydney newsroom. He previously worked at BuzzFeed, the Financial Times and The Information before joining the Financial Review as a media and tech correspondent. Connect with Mark on Twitter. Email Mark at mark.distefano@afr.com

PwC Australia has revealed it blocked a staff member entering into confidential policy consultation with the government in the wake of the firm introducing new compliance codes. 
In its latest report to the Tax Practitioners Board, PwC said the firm was continuing with its confidentiality compliance training program for staff after the regulator revealed the firm had misused sensitive government tax documents. PwC has been under siege after the TPB banned its former head of international tax Peter Collins and slapped the audit and consulting giant with a good behaviour order.
As part of its punishment, PwC must supply the TPB with a report detailing its efforts to improve staff training and disclosing any issues within the firm. 
The report reveals PwC has now pushed all new starters in the firm through tax and confidentiality training in the six months to November. However, PwC noted there were 90 staff, including four partners, who have not yet done the training as they were on leave in the period. 
PwC told the TPB it would continue with its training for staff in the coming six months to June 2024, including “additional comprehensive training and education program on conflict identification and management that will be rolled out to all PwC Australia partners and staff”. 
The report revealed elements of PwC’s training program for staff which asks staff to learn about honesty and integrity, independence, confidentiality, and competence. 
The training also includes a multiple choice quiz, asking staff questions including how to respond to “unethical situations” or identify examples of confidential tax consultation. 
PwC’s former head of international tax Peter Collins. Picture: Luis Enrique Ascui
PwC’s former head of international tax Peter Collins. Picture: Luis Enrique Ascui
PwC also said it would also insert “a clear policy statement” noting the firm would not approve confidentiality consultation on tax matters “with an organisation listed above where that individual has a client-facing role”. PwC told the TPB its head of compliance had updated the firm’s register of confidentiality agreements and undertaking entered into by the firm’s personnel. 
The firm said it had logged “well over 300” confidentiality agreements from staff and was now conducting a review of all nondisclosure agreements staff had uploaded to PwC’s database. 
PwC’s report reveals the firm knocked back the only staff member who requested to enter into a new confidentiality agreement for potential consulting on policy or regulatory reform in the period. “On the basis of the information contained in sections 1 to 4 of this report, it is considered that PwC AU complies with items 1, 2 and 3 of the TPB order, and this report forms PwC AU’s compliance statement as required by item 4 of the TPB order,” PwC noted in its report. 
TPB chair Peter de Cure said the regulator noted PwC’s response to the tax scandal and the orders by the regulator. 
He pointed to PwC’s moves to introduce a management response and action plan in the wake of a review of the firm’s culture by corporate veteran Ziggy Switkowski last year. Mr Switkowski warned PwC’s “aggressive growth agenda” had fed the culture that saw the firm misuse confidential briefings to benefit its tax practice. 
Mr de Cure said Mr Switkowski’s report raised concerns about PwC’s governance, culture, risk management and accountability. “We strongly encourage all registered tax practitioners to review and, where necessary, improve their processes of governance, risk management, supervision, culture, training and quality assurance,” he said. 
The TPB said it was continuing to monitor PwC “to ensure that any professional standard breaches are dealt with appropriately”.