A review into the firm by former Telstra boss Ziggy Switkowski found excessive power was conferred on PwC's chief executive and that there was a lack of independence and outside voices within the governing body.
The report was commissioned in the wake of the tax advice scandal, where partners at the firm shared confidential tax information from the Treasury department in order to boost business for PwC in the private sector.
Mr Switkowski said there were multiple shortcomings in the company arising from poor practices that went unreported for years.
"The aggressive growth agenda overshadowed and occurred at the expense of the firm's values and purpose," the report said,
"The focus on 'whatever it takes' seems, at times, to have contributed to integrity failures - some partners did the wrong thing while others failed to do the right thing by minimising the significance of questionable behaviours."
The report said an overly collegial culture within PwC amplified the power of the chief executive.
Mr Switkowski found that collegiality had created blind spots within the company, making it too willing to overlook unethical behaviour.
"The emphasis on growth coupled with high levels of trust and reluctance to challenge created blind spots. It may also have contributed to a willingness of partners to tolerate poor behaviours of 'rainmakers'," he said.
"PwC Australia has, at important times, been too slow to respond to mistakes and, as a result, found itself at the mercy of public narratives on trust."
The report outlined 23 recommendations for reform, including a board of partners restructure to ensure independence, change how the chief executive is appointed, and improving risk management.
PwC has accepted the findings of the review and agreed to implement the recommendations.
Chief executive Kevin Burrowes said the company took full accountability for the situation.
"From the top down, we are committed to rebuilding and re-earning the trust of our stakeholders. We are committed to learning, changing, and leading," he said.
"These investigations reveal shortcomings that should not have been possible at a firm like ours.
"It is clear that we did not meet our own expectations – much less those of our stakeholders – and that there was a failure of leadership, both by individuals and as a firm."
The Switkowski review also found the company did not have constructive dissent within the firm, exhibiting a culture where good news was communicated but bad news was held back.
"For partners of PwC Australia, events of the past several months are no doubt a reminder that, in a partnership of the firm's size and complexity, trust or an assumption of matters are 'being managed' is not good enough," the report said.
Earlier on Wednesday, the finance department said it was investigating whether PwC's spin-off company Scyne Advisory would be eligible for government contracts.
PwC divested its government consultancy business after the tax advice scandal for $1 to Allegro Funds, leading to the creation of Scyne.
The department's deputy secretary Andrew Jaggers said work was ongoing to determine if Scyne had no involvement with partners or officials in PwC involved in the tax advice scandal.
12°C