Tensions between PwC and Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), escalated last year over the Big Four firm’s plans to hire a senior executive from Neom, one of PIF’s most significant projects. This dispute contributed to PIF’s recent decision to impose a one-year ban on PwC from securing new advisory work with the fund.
According to sources cited by Financial Times, PwC’s attempted recruitment of Jason Davies, Neom’s chief internal audit officer, created “friction and angst” within PIF. Davies, who had worked at Neom since 2020, had agreed to move to PwC in mid-2023 but ultimately did not take up the role. His departure from Neom in September, coupled with PwC’s attempt to bring him on board, was seen as an aggravating factor in the fund’s decision to temporarily sever ties with the firm.
This move is a significant setback for PwC, whose business in Saudi Arabia has been one of the fastest-growing within its global network. While the firm will be permitted to continue ongoing consulting projects and retain its audit work in the kingdom, it will be barred from bidding for new work with PIF during the one-year suspension period.
PwC and PIF have declined to comment on the matter. However, insiders indicate that hiring a senior executive from a key client is generally seen as poor practice and can strain professional relationships. PwC had previously featured Davies in a glowing profile on its website, highlighting his role in building Neom’s internal audit function. That page has since been removed.
PwC’s Middle East operations, which fall under PwC UK, have played a crucial role in sustaining revenue growth amid a slowdown in consulting demand in Britain. In the year ending June 2024, PwC’s Middle East business reported a 26% revenue increase, compared to just 3% in the UK, contributing significantly to the firm’s total £6.3bn revenues across the two regions.
The dispute also comes amid broader changes in Saudi Arabia’s economic strategy. Over the past decade, international consultants have flocked to the kingdom following Crown Prince Mohammed bin Salman’s ambitious development plans. PIF, valued at $925bn, has been central to these efforts, driving economic diversification through mega-projects such as Neom, The Line, and other large-scale infrastructure initiatives.
However, after years of aggressive spending, Riyadh has recently shifted towards a more measured approach, reassessing and prioritizing its projects. This recalibration has put increased pressure on both government entities and consulting firms to demonstrate tangible returns on investment and prove their value in a more cost-conscious environment.
PwC’s fallout with PIF underscores the complexities of operating in Saudi Arabia’s evolving economic landscape, where competition for lucrative consulting contracts remains intense, and strategic relationships are paramount. The one-year ban highlights the delicate balance that firms must maintain when working with powerful government entities in the region.
