Tax: A new risk to corporate reputationFollow @PwC_LLP
Author: Rick Stamm - Vice Chairman, Global Tax
Tax has moved up the agenda of business leaders around the world. This does not come as a surprise to me or, I suspect, to many in the C-Suite at multinational corporations worldwide.
In the past 12 months we have seen a sharp rise in public debate on how businesses pay their taxes and on how countries levy them, a topic that has engaged governments, the media, citizen advocacy groups, NGOs and multilateral bodies such as the OECD. Tax avoidance will be at the heart of next month’s G8 summit in Northern Ireland, the first time that it has taken on such prominence at the meeting. The tax debate is adding a new dimension to the uncertain global business environment that we face in 2013.
Corporations are certainly feeling the heat – especially those who have found themselves in the media spotlight due to their tax strategy – and justifiably are concerned about the reputational and strategic risks. However there seems to be a disconnect. Our new report, Tax Strategy and Corporate Reputation, shows that almost half of CEOs do not consider corporate reputation a priority area for investment in the year ahead.
This seems contrary to the environment in which we are operating. It is my belief that tax strategy and managing this link to corporate reputation should become a higher strategic focus for businesses in 2013. Business leaders need to acknowledge that tax and the link to corporate reputation creates new risks that they cannot afford to ignore.
Explore this issue in detail and download the report here on pwc.com: 16th Annual Global CEO Survey: A focus on tax.
Rick Stamm is PwC’s Vice Chairman for Global Tax. He is responsible for building the capabilities of Tax practices across the PwC network of firms, as well as for interacting on Tax and business issues with many of the firm's larger clients.