Big four consultancy firms fess up to misconduct

A review has recommended major changes to the operations of consultancy firm PwC.

A review has recommended major changes to the operations of consultancy firm PwC. Photo: AAP

Embattled consultancy firm PwC has admitted to another conflict of interest breach, but claims it did not involve the misuse of government information.

The firm revealed the breach occurred in 2018, but is separate to the misuse of treasury information scandal that has engulfed PwC.

In response to questions from Greens Senator Barbara Pocock, PwC confirmed it had “taken action in relation to two matters involving conflicts of interest and/or the misuse of government information in the past five years”.

It comes as Australia’s other big consulting firms revealed they have fired partners and staff over integrity issues, sexual harassment, bullying, and dishonesty.

KPMG, Ernst and Young (EY) and Deloitte provided the figures to a parliamentary inquiry into their processes, following revelations PwC had misused confidential tax information to help drum up business.

KPMG wrote that it had received 88 allegations about staff misconduct in the last financial year, with 38 of those complaints found to be substantiated.

This resulted in 11 people being sacked, while others were given warnings or had their bonuses cut.

“We will continue to empower our people to speak up about any unethical or inappropriate behaviour in the workplace, especially to their leaders,” the response reads.

Eight partners at EY Australia have been fired in the past two years for failing to meet the company’s values.

The breaches include not acting with integrity, sexual harassment, bullying, and dishonesty.

Deloitte confirmed 121 incidents of misconduct with 13 involving partners, of which four were fired.

PwC has banned donations to political parties after the tax leak scandal.

In its response to the inquiry, EY wrote it “does not make any direct monetary political contributions”.

KPMG wrote that while it did not make “cash political donations”, it did contribute for memberships and sponsorships of business associations and conferences which provided networking and policy briefing opportunities.

Deloitte said its “contribution to Australian political parties is primarily for the purpose of facilitating discussion and the exchange of ideas between business, the broader community and government in the formation of policy”.

Senior partners at PwC used confidential government information to help companies pay less tax.

The embattled firm has since offloaded its government consultancy arm in a $1 sale to private equity firm Allegro Funds.

A parliamentary committee’s interim report criticised PwC for engaging in a calculated breach of trust by using confidential information for tax avoidance.


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