Get access to the Editor’s Digest without cost
Roula Khalaf, the Editor at FT, shares her top picks in this engaging weekly newsletter.
Tensions arose last year between Saudi Arabia’s sovereign wealth fund and PwC over the firm’s plans to recruit a key executive from one of the fund’s significant projects, according to sources familiar with the situation. Recently, the Public Investment Fund (PIF) placed a one-year halt on awarding new advisory projects to PwC, a firm heavily involved in the $500 billion Neom project along the Red Sea, managed by PIF.
This decision struck a blow to PwC’s Saudi Arabian operations, which rank among the fastest-growing in the company’s global network. It also sparked wider discussions about Saudi Arabia’s reliance on international consultancy services.
PwC’s desire to hire Jason Davies, Neom’s chief internal audit officer, reportedly displeased insiders at PIF, according to five informed individuals. Davies, who had joined Neom in 2020, was set to transition to PwC midway through last year, some sources noted.
These recruitment efforts led to “friction and angst” between PIF and PwC, said one insider. Recruiting a senior executive from a client, they added, “causes a lot of aggravation and doesn’t look good.”
Having previously worked at Deloitte and Tesco in the UK, Davies left Neom in September, according to his LinkedIn updates, but he never joined PwC. He did not offer any comments on the matter.
During his tenure at Neom, PwC showcased Davies in a feature on their website, highlighting his achievements in building Neom’s internal audit operations. However, this page has been removed and now redirects to PwC’s main site.
Several sources pointed to the dispute over Davies’ hiring as a key element in the strained relationship between PIF and PwC, resulting in the recent restriction. Although PwC can continue ongoing consulting assignments for PIF and its audit work remains unaffected, it won’t be eligible for new bids from the fund.
Both PwC and PIF declined to comment on the situation.
PwC’s Middle Eastern wing, a subdivision of PwC UK, has contributed significantly to revenue growth, especially during a downturn in consulting demand within the UK. For the year ending June 2024, sales in the Middle East grew by 26%, while UK revenues saw a modest 3% increase. This regional business represented nearly a third of PwC’s total revenue, amounting to £6.3 billion from the UK and Middle East combined.
Over the past decade, Saudi Arabia has attracted numerous consultants following Crown Prince Mohammed bin Salman’s ambitious initiatives to modernize the country and lessen its reliance on oil. The hefty $925 billion PIF has been central to this transformation, channeling vast sums into mega-projects and creating new enterprises.
Neom, featuring plans like the linear city The Line, a ski resort, and hubs for logistics and tourism, stands as the prince’s hallmark enterprise, generating substantial fees for consulting companies.
However, after years of aggressive spending, Riyadh has recently tightened its financial plans, reassessing its investments with some projects being postponed or downsized. This fiscal adjustment places increased demands on government bodies and consultants to deliver measurable outcomes and justify their contributions.
