Two years ago, we launched our inaugural Trust Roadmap after undertaking a detailed look at what trust means for PwC Canada and identifying what we need to do next to ensure we’re meeting the expectations of our stakeholders. It included a set of commitments for how we’ll build trust and a list of key performance indicators to measure how well we’re doing against our targets. We promised we’d be transparent about our progress along the way. We also began having more conversations about trust both inside and outside our firm.
Why did we do this? At PwC Canada, trust is at the core of what we do. It’s part of our purpose, which is to build trust in society and solve important problems. It’s also a key element of our strategy, The New Equation, which is all about helping organizations build the trust they need to succeed.
Our path to building trust in PwC Canada
Our Trust Roadmap reflects our recognition that for us to help others build trust, we must be trusted ourselves. One of the key steps in the journey was to hold ourselves accountable by disclosing five-year targets and KPIs to measure our performance across our top trust drivers each year.
Our roadmap is an acknowledgement that the importance of trust continues to grow as societies around the world grapple with declining public confidence in key institutions. At PwC, we are not immune to this, and we acknowledge that there can be situations where our stakeholders ask us to do better.
We are committed to ensuring that we continue to earn our stakeholders’ trust every single day. If and when issues do arise where we don’t get it right, we take immediate ownership and corrective action.
This report provides an overview of our progress on our most important trust drivers identified by our stakeholders, which we’ve divided into three categories below. The update includes actions taken, how we’re tracking against our goals and key learnings during our 2023 fiscal year, which covers the period from July 1, 2022, to June 30, 2023.
Download our 2023 Trust KPI table (PDF)
Our progress towards addressing our blind spots
Holding ourselves accountable while helping organizations align around reporting standards to drive better quality outcomes: Actions included the submission of comment letters in response to consultations for the Global Reporting Initiative (GRI) and the International Sustainability Standards Board (ISSB) and membership to the ISSB Partnership Framework for capacity building, which aims to support implementation of the sustainability standards.
We’ve also supported the evolution of the Task Force on Climate-Related Financial Disclosures (TCFD) and now the Task Force on Nature-related Financial Disclosures (TNFD). To further support this, we’ve launched our global Centre for Nature Positive Business to help organizations in their climate and nature journeys and undertook a nature-based materiality assessment of our land footprint for offices that are next to key biodiversity or protected areas. Within Canada, we reported three locations—Vancouver, Gatineau and Windsor—where we put a greater emphasis on understanding our physical impacts on the surrounding natural environment.
We also continued to actively participate in coalitions to advance environmental sustainability across our global network of firms. These included the LEAF Coalition, a public-private effort to protect tropical forests; the World Economic Forum’s First Movers Coalition, which brings together companies using their purchasing power to create early markets for innovative clean technologies across eight hard-to-abate sectors; and the WEF’s Clean Skies for Tomorrow coalition, which seeks to help the world transition to sustainable aviation fuels.
Here in Canada, we’re focused on leading and shaping the Canadian Chamber of Commerce’s Net-Zero Council recommendations on climate policy and released new thought leadership offering insights on key sustainability and environmental, social and governance (ESG) trends. These included our 2023 ESG Reporting Insights for public companies and our playbook for tech-enabled ESG reporting.
Refreshed our People Value Proposition and reimagined our performance pay program: We further integrated PwC Canada’s trust drivers into our Canadian business strategy and used feedback from a national listening tour with our people to launch our refreshed People Value Proposition (PVP), Me + PwC Canada. Our PVP reflects the authenticity and value that each person brings, as well as the meaningful work, connections, rewards and growth our firm offers. As part of our PVP, we reimagined our performance pay program to bring greater transparency to our review processes, with a focus on being consistent and equitable across our lines of service.
These actions helped contribute to an overall increase in our People Trust Index to 75% from 71% towards our 85% target. Our people’s sentiments around being treated fairly also increased (to 75% from 72%), as did feelings of being treated well (to 79% from 74%).
While we’re trending in the right direction, our people want us to share even more about how well we deliver against the commitments we make to our stakeholders. That’s why we’ve moved to a monthly trust survey and have launched a leadership dashboard to compare how well our actions and progress align to our people’s feedback. We plan to share more about what we’re learning.
Took action on workforce representation to support greater diversity on our teams: This year, we increased representation on our partnership board, with the percentage of women rising to 46% from 33% towards our goal of 50% and visible minorities increasing to 23% from 17% towards our target of 30%. But we didn’t move the needle as fast across our partner and staff populations in all areas. To help accelerate the transformation of our corporate culture and further embed an environment of belonging, we introduced new programs based on feedback from our annual equity, inclusion, diversity and belonging (EIDB) survey.
We launched a new interactive Amplifying Black Leaders (ABLe) personal and professional leadership development pilot program. Our workforce data indicates that attrition rates for Black managers and senior managers are higher than peers across the firm. While results are improving on a year-over-year basis, Black women at the firm continue to have the lowest equity, inclusion, belonging and safety scores on the EIDB survey. The ABLe pilot program is one way we’re addressing these issues.
We introduced three new inclusion network groups based on feedback from our people to help celebrate and support more cultures and identities within our firm: the Middle Eastern and North African Inclusion Network; the Muslim Inclusion Network; and the Jewish Inclusion Network.
Top trust drivers to address blind spots:
- Engaging in courageous conversations in the moment·
- Showing how decisions are made and actions are taken
- Treating stakeholders fairly and well (these are related yet different concepts)
- Fostering connection to PwC Canada through approachable leadership and a broader sense of community
Our progress on maintaining trust around our core competencies
Continued to strengthen audit quality: The Canadian Public Accountability Board (CPAB) undertakes an annual inspection of the quality of PwC Canada’s work as auditors of Canadian reporting issuers. In March 2023, CPAB issued a report on the 2022 inspection. As at June 30, 2023, the 2023 CPAB inspection was underway and is likely to conclude towards the end of this year. While we can’t share the results publicly due to regulatory restrictions, we continue to be very proud of our CPAB inspection results.
In addition, the firm is registered with the PCAOB and subject to PCAOB inspections on a sample of clients where we are auditors of SEC registrants and their affiliates. While we are not satisfied with our 2022 findings that were released this year, we are confident in our continued ability to deliver strong audit quality. We have analyzed the root cause of the matters raised, have taken remedial actions and remain focused on continuous improvement. For more information, read our Transparency Report, which includes additional information about our audit practice and related services.
Conducted testing to reinforce our unwavering commitment to independence: All PwC Canada partners and practice staff must complete comprehensive annual training and a compliance confirmation, through which they confirm their compliance with relevant aspects of our independence policy. Professional staff are subject to personal independence compliance testing on a random basis. Findings of external non-compliance represented 0.7% of tests completed, up from 0.6% as of our last fiscal year.
Strengthened the psychological safety underpinning our culture of speaking up: Last year, we started to disclose our Speak-up Index, composed of responses to our People Trust Survey, to assess employees’ knowledge of and interaction with our ethics protocols. It includes industry-standard elements for measuring awareness of channels for escalation as well as experiences and satisfaction when raising ethical matters.
This year’s results rose by five percentage points, to 81% from 76%, with the biggest increases seen in our people’s awareness of reporting channels based on a national campaign we undertook. We noted a decrease in results related to satisfaction with resolutions of concerns raised, primarily attributed to a small sample size. This remains an area for continuous review.
Reinforced our commitment to quality and compliance with our network’s professional standards: Quality and compliance are at the heart of our purpose and a top priority for our stakeholders. Our measures related to engagement quality and compliance reflect our values and a culture of transparency and continuous improvement.
Last year, we spent more than 27,800 hours on engagement compliance and quality reviews, and we’re committing to maintaining our strong track record as part of our 2025 targets. PwC Canada is in full compliance with our network’s code of conduct and upholds its professional standards and values through every interaction with our stakeholders each day.
Announced plans to invest $200 million over the next three years to expand our artificial intelligence (AI) capabilities: This will help strengthen our ability to deliver human-led and technology-powered solutions and build trust and drive sustained outcomes in line with our global strategy, The New Equation. Our investment features an industry-leading relationship with Microsoft, creating scalable offerings using OpenAI’s GPT-4/ChatGPT and Microsoft’s Azure OpenAI Service. We’ll use this technology to help organizations reinvent their businesses and deliver better outcomes by generating richer insights, driving more productivity and developing new products and services in ways that build greater trust with stakeholders.
Upskilled our teams through badges: Our badge program gives our people an opportunity to learn, apply and gain recognition for the knowledge and skills our clients and our business demand. Last year, 790 current and former partners and staff earned a badge in Canada.
We also introduced a new badge—Sustainability: Climate Impact—designed to help our people navigate client conversations and understand what success looks like for climate leadership. Through a series of videos, online learning, simulations and activities, participants learn about the urgent need for action on climate change, industry trends, the steps we can all take as individuals and what PwC Canada is doing to help.
Top drivers of maintaining trust around our core competencies:
- Adapting our services to evolving ethical business practices to earn the right to lead our industry
- Delivering the quality products and services our stakeholders expect
- Clearly articulating what we stand for, acting on our values and we delivering on our promises
Our progress on the table stakes disclosures our stakeholders care about most
Pay equality and transparency: Last year, we undertook a comprehensive, two-year analysis of our pay equity landscape and have set, and publicly disclosed, aspirational targets for equity in compensation for women and visible minorities by the end of our 2025 fiscal year. We assessed and refined our compensation programs to understand how consistent we are in our compensation for employees performing the same job.
These reviews helped us proactively identify and address factors that could contribute to a wage gap to ensure we’re creating a workplace where we’re continually advancing and realizing fair and equitable pay for all, regardless of gender or race. While we made progress year over year, we still have more to do and are working to deepen our understanding and implement plans across lines of service and levels within our business.
Reinforced our near-term net-zero targets while adhering to our 50% emissions cap: PwC has made a worldwide commitment to achieve net-zero greenhouse gas emissions with 2030 goals. The PwC network will also work with our clients to support their efforts, contribute to public policy developments in support of net-zero goals and decarbonize our own operations and supply chain through near-term targets validated by the Science Based Targets initiative (SBTi). To reduce impacts today, PwC will offset emissions through high-quality carbon credits, transitioning to 100% carbon removals by fiscal year 2030.
As part of our efforts to ensure personal and business accountability within Canada, we also made progress against our 50% business travel cap to mitigate emission increases from flights as we emerge from the COVID-19 pandemic. We didn’t breach this cap during our 2023 fiscal year due to actions we took to embed carbon budgets into each of our business units. Supporting our efforts were new technology solutions we incorporated into our client engagement planning process, such as the Environmental Footprint Insights tool that offers carbon-budgeting capabilities and enables better reporting through insights into our emissions, carbon costs, travel time and expenses.
Accelerated our progress towards digitally upskilling two million Canadians: We’ve continued to make progress on our social impact efforts such as our commitment to digitally upskill at least two million Canadians by our 2025 fiscal year. We’ve now reached more than 1.6 million beneficiaries through our upskilling programs and have increased our focus on sharing our pro bono capabilities to further enhance our impacts. Here are three examples of successes last year:
- Women in Capital Markets (WCM): Our women-led engagement team developed a series of training modules focused on equity, diversity and inclusion; sponsorship; psychological safety; unconscious bias; and supporting flexibility in the workplace. By scaling our efforts, we reached almost 100,000 financial services leaders in support of WCM’s vision.
- Alloprof: Our team developed a new strategic plan and financial model to help this Montreal-based francophone charity take advantage of new digital capabilities. Our work included the introduction of new AI solutions to help enhance the user experience, reach and impact of Alloprof's programs and services, which more than 550,000 students access for free each year.
- Canada Learning Code (CLC): Our Behavioural Insights team undertook an analysis of a student’s learning journey and developed interventions to help increase the number of students who register for a course on an annual basis and their likelihood of attending and completing it. This project will impact at least 45,000 learners over the next three years and help provide access to the knowledge young people need to prosper in our digital world.
Continued to deepen our economic impact: As part of our focus on paying our fair share of tax and helping build a stronger and more resilient economy for all, we work with our Canadian economics and policy practice each year to quantify our direct, indirect and induced economic impacts. This year, our contributions to Canada’s gross domestic product increased, along with our impact on jobs, labour income and government tax revenue.
Key disclosures to address stakeholder expectations:
- ESG reporting topics
- Fair pay for fair work (and with pay equity)
- Sustainable and profitable growth in the business
Key takeaways for an evolving trust agenda
Our experiences have not only uncovered some of the gaps we need to address but have also given us key insights into the broader trust agenda. For leaders and organizations working on their own approaches to trust, here are some key takeaways and insights from our journey over the past year:
Empowering people to learn about ESG on the job can help them generate richer insights for the business while accelerating sustainability outcomes
People are attracted by the opportunity to work for an organization they admire and whose values match their own. This, in turn, supports recruitment, retention and performance. We’ve also learned that when providing people with ESG training and knowledge they can use on the job, it can help them think differently, feel a greater connection to the firm’s purpose and generate richer insights and innovative solutions for our clients.
This has a ripple effect on the firm’s ability to provide people with more meaningful work, connections and rewards and has resulted in positive progress across many of our Trust Roadmap KPIs. Our people’s feedback has also led to the development of important new initiatives that have had significant impacts, such as Amplifying Black Leaders, ESG content for our badge program and pro bono support for Women in Capital Markets. Empowering people to make a difference can supercharge your sustainability objectives.
Data quality, transparency and assurance remain critical, but the automation of ESG information through technology is the game changer
ESG data must be collected, structured and stored in a way that lets functional leaders access timely and meaningful internal information that helps them improve their own sustainability performance. Technology is key, which is why we used new solutions like Environmental Footprint Insights to embed ESG decision making into our client engagement life cycles and created automated workflows and data visualizations to become more agile in our ESG-related leadership decisions.
This has helped create a more fulsome picture of how data quality builds trust in our reporting; uncover opportunities to better integrate existing technologies to strengthen internal controls; develop an ecosystem connecting data and insights to behavioural change; and expedite the time required to undertake limited assurance on this report.
Setting near-term targets associated with public commitments and reporting on concrete action plans are now stakeholder expectations
Companies need to report ESG data that’s of the same quality as their financial information and is independently assured. Regulators are moving quickly, and so are our stakeholders. They’re asking for clear action plans to describe ways we’re transforming our operations today, aligning with reporting standards and providing examples to demonstrate immediate progress year over year.
This is why we’ve updated our near-term science-based targets for our net-zero goals and are providing more illustrative examples to show how our firm is making meaningful and quantifiable progress across our compliance, independence, diversity, inclusion and social impact programs. This has been a starting point to strengthening transparency with our stakeholders as we focus on breaking down our commitments into manageable chunks.
We’re also being open about what is and isn’t working and why. Bold leadership requires all organizations to talk about their course corrections immediately and show how they’re making changes today, especially now that stakeholders expect this as part of a licence to operate.
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