PwC Australia’s government business will become a new company called Scyne Advisory after the embattled consulting giant offloaded it to private equity firm Allegro Funds in a $1 fire sale, seeking to move on from its damaging tax leaks scandal.
Scyne is set to be fully independent of the scandal-rocked consulting firm and will take on 1750 PwC employees, Allegro said in a statement on Tuesday morning confirming the binding deal. The private equity fund said it expected to invest more than $100 million to support the business in the future.
To boost corporate governance standards, Scyne will have an independent board of directors. Former Federal Court judge Andrew Greenwood will join as non-executive director, and candidates for an independent chair, a CEO and more non-executive directors are still being interviewed, the statement said.
In the interim, 12 senior leaders of PwC’s Government Health Infrastructure and Defence (GHID) and Trust and Risk (T&R) divisions, which together make up the new company, will lead the business to minimise interruption to client work.
The new company will also establish a number of boards, including a probity, conflict and ethics subcommittee chaired by Greenwood, an audit and risk subcommittee, and a people and remuneration subcommittee.
The sale of PwC’s public sector advisory business, which includes all its work for federal and state government departments, including healthcare and education, was flagged in late June and came into effect on July 1 after the consulting firm and Allegro signed off on the terms of the deal.
Public work represented about 20 per cent of PwC’s revenue for the 2023 financial year. The transaction is expected to be completed by the end of August.
“Scyne” is Old English for “scene – meaning beautiful and bright – and the name was chosen to indicate a new dawn for the troubled government consulting business, a spokesperson said.
The company is eager to win back government clients that effectively blacklisted PwC after the scandal broke.
Scyne partner Tim Jackson, one of the 12 former PwC partners forming its interim leadership, described the business as a “start-up” intended to restore trust in public sector consulting and be governed in a conflict-free way that puts clients first.
“To be a part of a start-up that has the chance to really totally redefine consulting to the public sector in Australia I think is super exciting,” he said. “To do that with the heft of about 130-odd partners and 1500 staff is something I don’t think we’ll ever get the opportunity to do again in our lifetime.”
“Making sure that we can hand on heart say that our team are free of those conflicts is a really critical element of our business model going forward.”
Scyne will devise its own code of conduct that will build on the Australian Public Service (APS) code of conduct, which stipulates that employees must act with honesty, integrity, care, diligence and not misuse information for personal gain.
Meanwhile, its Greenwood-chaired probity, conflict and ethics subcommittee is designed to ensure that new and existing employees are not associated with PwC’s tax leaks scandal, looking at conflicts of interest in the past and people potentially associated with those to start the new firm off with “a clean slate”, said Scyne partner Tim Jackson.
Allegro co-founder Adrian Loader said the private equity firm was backing the troubled business’s new leaders and their “vision to drive real change” in the public service advisory sector.
“It’s clear there is a need for a strong and independent government advisory firm of scale in the Australian market,” he said. “Scyne Advisory will have an industry-leading governance model able to meet the requirements of the Australian government and its agencies.”
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Source: Thanks smh.com