PwC has announced it will no longer make donations to political parties, but a Labor senator central to investigating the consultancy firm’s misuse of confidential government tax information says the company needs to further boost its own accountability procedures.
In a note to the company’s partners on Monday, PwC’s acting CEO Kristin Stubbins said the firm’s self-imposed ban on making political donations was an “important step” in rebuilding its reputation.
“PwC Australia will no longer make political donations, with none to be made in FY24. This includes payments to attend fundraising events, in-kind donations for event hosting/catering and other direct donations,” Stubbins wrote, according to an excerpt of the note provided by PwC.
“Although we have always taken the utmost care to ensure our political donations do not create any real or perceived conflicts of interest, we recognise that doing away with political donations is the best way of ensuring the highest standards of governance.
“While we cannot change the past, we can control our actions today and in the future. As stated, we will continue to take all appropriate steps to improve the firm’s governance standards.”
According to the Australian Electoral Commission’s 2021-22 donor returns, PwC donated a total $246,352 to political parties in numerous individual donations to various national and state branches of the Labor, Liberal and National parties.
Analysis by the Centre for Public Integrity found the big four consultancy firms – PwC, Deloitte, EY and KPMG – have donated $4.3m to Labor and the Coalition over the past decade. During that time, the value of their government contracts increased by 400%.
Greens senator Barbara Pocock had called for a ban on the major firms making political donations while Geoffrey Watson, a board member at the Centre for Public Integrity, said the federal government’s “persistent over-reliance” on the firms had “a corrosive impact on the role of the Australian public service”.
Deborah O’Neill, the Labor senator from NSW, said PwC’s stance on donations was “entirely a matter for them” but that political parties relied on such donations, and noted they were subject to laws around declarations. She added that the company’s announcement on donations did not ease her concerns about whether PwC had learned lessons from the ongoing scandal.
“The gross breach of trust and ethical misconduct by PwC which saw them monetise confidential government information for their own profit was reflective of their firm’s internal failures of professionalism and accountability. The move by PwC to cease political donations, does not have any bearing on the kind of misconduct which has been the subject of public discourse in recent months,” O’Neill said in a statement.
“This announcement also fails to provide any increased assurance that PwC will not engage in unethical or inappropriate conduct with regards to the undertaking of future government contracts.”
PwC last week confirmed the divestment of its government consultancy business to the Sydney-based Allegro Funds. The new business, named Scyne Advisory, will have its own staff and will solely advise the public sector and its agencies.
O’Neill, who led scrutiny of PwC’s misuse of confidential government information along with Pocock, claimed that the company’s “obsession with profit has been the driving force behind their gross failures of professionalism and monetisation of government information”.
“I await announcements from PwC regarding what decisive action they will take to address their glaring lack of internal accountability frameworks and culture of pursuing profit over government, client and employee outcomes,” she said.
Pocock welcomed the end to PwC’s donations, calling on the other Big Four firms to follow suit.
“Anyone doing business with the government should not be allowed to make political donations. I’ve been calling for a ban on donations from the Big 4 for months. Labor should have acted on this as soon as the PwC scandal broke but they sat on their hands and now it is the business community who see the ethical problem and have done the right thing.
“If Australia’s biggest consulting company recognises the perceived corruption then so should Labor and the LNP. It’s time to break all the links. The government must act now to clean up politics once and for all.”
