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October 2, 2023

PwC’s Mandated Conflict of Interest eLearning AKA a BuzzFeed Quiz on Ethics and Integrity

PwC building in Melbourne

Which Tax Practitioners Board Code of Conduct violation are you? It seems that’s the question PwC Australia is trying to answer in its new conflict of interest training, born out of the absolute shitstorm that began years ago when former partner Peter Collins leaked confidential information he’d received about upcoming Australian tax legislation in consultation with the Australian Tax Office to several other partners at the firm so PwC could turn this information into billable hours.

As part of its severe punishment for this malfeasance — as if the catastrophic reputational damage isn’t punishment enough — PwC has issued its first compliance report required by the TPB to show that the firm is explaining to grown professional adults what the word “confidential” means. The full report [PDF] is embedded below and a copy of the TPB order can be found here, we’re going to run through the TPB requirements quickly.

From December 2022 to December 2024 PwC is required to:

  1. Ensure that appropriate training is provided on a 6-monthly basis to relevant partners and staff on compliance with the Code of Professional Conduct and PwC’s policies on conflicts of interest, particularly including PwC AU’s policy for managing conflicts of interest arising from engagements of partners and staff by Treasury, the Board of Taxation and/or other Australian Government agencies. [Note: PwC sold off its poisoned public sector consulting practice so…that’s one less conflict]
  2. Ensure that the Head of Regulatory Affairs (or their delegate) takes all reasonable steps to maintain the central register of confidentiality agreements, including regular status-checks with relevant partners and staff on the register.
  3. Ensure that the Chief Strategy, Risk and Reputation Officer (or their delegate) reports every 6 months to the Executive on the management of the participation of relevant partners and staff in confidential tax consultations with Treasury, the Board of Taxation and/or other Australian Government agencies.
  4. Provide a compliance statement to the Tax Practitioners Board every six months confirming:
    • that PwC AU has complied with the requirements detailed in (1), (2) and (3) above
    • the names of all relevant partners and staff who attended the training outlined in (1) above
    • the content of the training provided under (1) above.

Thus we are here now talking about the first compliance report and, more specifically, the training modules the firm was required to put together to adequately train tax partners and staff on the art on not screwing up. The report is, as expected, branded in PwC autumns but clearly the in-house designer was directed not to spend too much time making it fancy like they do sales materials and recruiting brochures.

I mean, compare this:

To this from a report that wasn’t required by a supervisory body as a direct result of bad behavior:

Whatever, it’s not like they’re trying to win business from anyone on the Board.

The report says PwC developed “a targeted training course focused on the Tax Agent Code of Conduct and Regulatory Consultation processes” that specifically covers professional conduct, PwC policies on conflicts of interest, and PwC policy for managing conflicts of interest arising from confidential consultations. The course was completed by all Registered Tax Agent Partners and Managing Directors (via video conference) during the period November 2022 through February 2023 and training was tracked for attendance. The training course material was then converted to an eLearning format and was subsequently provided to all Tax and Private Tax Partners and staff during May and June of this year.

Appendix B of the report includes the whole shebang (starts on page 24 in the embedded report below).

Just in case any well-educated professionals over the age of 40 are confused on the definition of NDA (as it seems Peter Collins was), there’s a bit on that too. A lot on that, actually.

It’s too bad this training didn’t exist years ago or maybe we wouldn’t be here talking about it. Oh well. Now because they were forced by the TPB to do this after the fact they have to write all of this out as if they’re going to be invited to confidential consultations with the government anytime soon. Here’s a bit of the text, some of which they highlighted in red for extra emphasis. TL;DR: DO NOT GET US IN FUCKING TROUBLE

Finally, confidential information is not limited to client information. It may also extend to any information you receive when you are working on a tax confidential consultation with government or a regulator where you have entered into a confidentiality agreement.

 Tax confidential consultations

  • A tax confidential consultation is where PwC has been asked to contribute ideas or make recommendations to government, government agencies or regulators (e.g. ATO / Board of Taxation / Treasury) as they develop policy positions or undertake regulatory reform.
  • PwC’s contributions may, on a case-by-case basis, analyse the technical and / or broader merits of proposals and in doing so we may identify inherent weaknesses and biases for consideration by a government, government agency or regulator.
  • These consultations may be performed under normal commercial engagements, pro bono / low bono or on secondment.
  • You may also be asked to sign a confidentiality agreement when working on a tax confidential consultation.

Conflicts of interest and confidential information

  • Participation in a tax confidential consultation with government or a regulator means that the participant will receive and have access to confidential information.
  • The participant must at all times observe their duty of confidentiality to the relevant government department or regulator. Different consultations may involve different obligations.
  • The confidential information may be relevant to the commercial or strategic interests of one or more of our clients but still may not be disclosed to the client and, in many cases, cannot be disclosed even to fellow colleagues.

In some circumstances, disclosure of confidential information can constitute a criminal offence. If you are not sure about the scope or content of a confidentiality obligation, please seek advice from the Office of General Counsel and FA Risk & Quality.

Quiz: can you consult the government with one hand and clients with the other using information you aren’t supposed to monetize? No, no you cannot.

In a news release on its website the Tax Practitioners Board said:

TPB Chair, Peter de Cure AM, acknowledged the report and said ‘PwC have agreed to pro-active transparency with the TPB. This report shows steps PwC has taken to comply with the TPB’s Order, including additional training on legal and ethical issues for over 1,300 personnel.’

Mr de Cure went on to say ‘the Compliance Report states that PwC have improved their management of confidential consultations with government, including a central approval and registry process, and oversight by their Executive Board. The TPB welcomes improvements made by PwC and all tax practitioners, to enhance professional standards, including integrity, confidentiality and conflict of interest management’.

See you again in six months for the next report.

PwC Compliance Report via Tax Practitioners Board by Adrienne Gonzalez on Scribd

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