www.pwc.hu

Sustainability Report

1 July 2019 – 30 June 2020

1 I Sustainability Report – 1 July 2019 – 30 June 2020 Contents

CEO’s letter 3 Our key performance indicators 4 About the report 5 About PwC 7 Responsible marketing & communications 8 Our values 10 Our people 12 Diversity 20 Our strategy 22 Our stakeholders 33 Responsible operation 43 PwC in Hungary 48 Quality and risk management 54 Human rights 55 GRI content index 59

2 I Sustainability Report – 1 July 2019 – 30 June 2020 CEO’s letter

PwC closed an unusual financial year on 30 June 2020. The worldwide Without building trust, it is impossible to achieve success, and today we are spread of COVID-19 has brought unprecedented uncertainty to all actors facing a global problem that is in our common interest to solve. This year, in the economy and society. Factories have shut down, educational we have supported organisations and causes that have been particularly institutions have closed, we have been forced to work from home en masse vulnerable to the pandemic, and have developed solutions inspired by the for months and our free movement has been restricted. We had to come up changed circumstances. with new business procedures and new ways of working almost overnight to ensure business continuity. However, amidst all the uncertainty, one thing is clear: the world as we knew it has changed, and we are facing a spate of new challenges. We At PwC, we have adopted a “new normal” in our operation: with the help must all adapt to these challenges. When, if not now, do you most need of our internal systems and advanced technologies, we have been able new skills and knowledge to stay afloat? to work seamlessly even away from the office and our clients, and I can proudly say that we are now moving forward with the third phase of crisis Our responsibility to others begins at home and extends to the communities management, which means long-term strategic measures. Our primary goal in which we live and work. We have invested in innovative solutions at PwC is to retain jobs, maintain continuous operation and quality of work while Hungary and in the global network for years, and the current circumstances Tamás Lőcsei doing everything we can to keep ourselves, our people, our families and our afford even more opportunities for online learning and cooperation. We clients healthy. were pleased and proud to share PwC’s free English-language Digital Country Managing Partner, Fitness app with everyone. I encourage you to download and use the app PwC Hungary PwC’s global mission statement to gain up-to-date knowledge through the range of content it offers. I believe today’s leaders need much more empathy to be able to motivate – “We build trust and solve employees. It holds true even more so today that people want to work for a company that has a mission, a business philosophy that resonates with important problems” – has never them both intellectually and emotionally. This is a moment in history that provides an opportunity and incentive for all organisations to consolidate been more relevant. their goals. I thank all PwC staff, clients and civil society partners for working together over the past year. I believe that mutual trust will pay off and that, as a result of quality work, PwC will emerge stronger from the crisis as a company with advanced digital skills and renewed operations.

3 I Sustainability Report – 1 July 2019 – 30 June 2020 Our key performance indicators

Sales revenue Headcount HUF 23,161,700,000 835

Number of Pro bono Voluntary training hours working hours working hours 97,838 1,445 2,781

Ratio of women to Average age Client satisfaction CO2 emissions men 33.3 years index -4.64% 59% women 64 41% men

4 I Sustainability Report – 1 July 2019 – 30 June 2020 About the report

PwC Hungary began publishing its annual sustainability report in 2012. This report provides an overview of the efforts we made in the past financial year to find valuable solutions for today’s challenges and complex business problems. In this document, we summarise the activities our colleagues carry out every day, aligned with our strategy, to ensure PwC’s operation as a sustainable business. Our goal is to continually improve our economic, social and environmental performance and to contribute to the development of the Hungarian and global economy.

Our report is an important management tool, as it provides a comprehensive overview of our past performance and future direction. The internal review carried out as part of the reporting process clarified the extent to which our corporate systems and processes affect our economic, environmental and social performance, and highlighted the areas for improvement that could further improve our performance in the field of sustainability.

We have prepared our report in accordance with international GRI standards, without independent third-party certification.

Our report aims to be comprehensive, showing our stakeholders how our company operates and how we impact our immediate and broader environment. We use the experience gained during the reporting process, as well as the feedback we receive, to improve our sustainability performance.

The report covers all PwC entities operating in Hungary and their sustainability performance, and presents consolidated information on their economic, social and environmental performance.

■■ PwC Auditing Ltd. ■■ PwC Hungary Ltd. ■■ indirectly, Réti, Várszegi & Partners Law Firm PwC Legal

5 I Sustainability Report – 1 July 2019 – 30 June 2020 The reporting period includes – in accordance with our financial year – the one-year Defining the topics interval between 1 July 2019 and 30 June 2020 (FY20 or 2020 financial year). Due to the non-calendar financial year, besides the information and data, the special measurement We summarise below the topics that constitute the basis for how we do business. We and calculation methods are also shown where necessary. Where possible, we have also report on the performance of the previous financial year by means of these topics because provided the data of the previous financial year (FY 2019) to facilitate comparison. We they are the most important in terms of the sustainability of PwC’s operations. have prepared the report in accordance with the Global Reporting Initiative (GRI) reporting framework in terms of both the structure of the report and the reporting process. We have The topics covered here have been defined on the basis of the information requested prepared our sustainability report in accordance with the GRI Standards: Core option to by our leaders and representatives of our various units. Every year, we define the right report about economic and social impacts, emphasizing the following principles for defining tools to examine and improve these topics, and to make them sustainable. In order to report content and quality: materiality, stakeholder inclusiveness, completeness, accuracy, determine the topics, we collected information on an ongoing basis, analysed our activities, comparability, timeliness, reliability, balance, and the sustainability context. coordinated with our organisational units, engaged stakeholder groups, and incorporated feedback.

We ranked the relevant areas and topics according to their strategic importance and their Definition of the reporting process social, economic and environmental impact on our stakeholders.

In our reporting process, we have progressed in accordance with the steps outlined in the GRI criteria system. Firstly, we determined the focal points (important issues) that are relevant for the future of the company and are closely related to our objectives. Secondly, Wellbeing of our people we explored the company’s environment while mapping our wider stakeholder groups, and then ranked them by their influence, and finally we explored the major topics that they think Innovative business are relevant to the company’s operation. solutions Customer satisfaction

Stakeholder groups or “stakeholders” are those persons and small or large social groups that influence the effectiveness of corporate operation, or on whom the company has any Reaching the next economic, environmental or social impact and who gain benefits or suffer disadvantages as Professional self-fulfilment of generation a result of the company’s operation. our people, talent management

If you have any questions or comments concerning our sustainability report or PwC’s operation, please e-mail us at [email protected]. We will use your feedback to improve next year’s report. Professional assistance Community to civil society engagement

Sustainability in our supply chain

Diversity and inclusion

6 I Sustainability Report – 1 July 2019 – 30 June 2020 About PwC

PwC is one of the world’s leading business consultancy firms. We help our clients achieve their goals through our industry-specific professional services. PwC Hungary With offices in 155 countries and more than 284,000 people, we are among the leading professional services networks in the world. We help organisations and individuals create the value they’re looking for, by delivering quality in assurance, tax, advisory and HUF 23,161,700,000 technology consulting services. Sales revenues

At PwC, our purpose is to build trust in society and solve important problems. 2 offices

835 employees

PwC Global

Gross worldwide revenue by region Gross worldwide revenue by service USD 43,032,000,000 (in millions of USD) area (in USD millions) Sales revenues Tax advisory Western Europe 13,927 10,748 155 countries Americas Audit 18,286 17,603 Middle East 284,000 and Africa employees 1,766

Central and Eastern Australia and Europe Oceania Asia Advisory 950 1,721 6,382 17,603

7 I Sustainability Report – 1 July 2019 – 30 June 2020 Responsible marketing & communications

The PwC brand One of the tasks of PwC Hungary’s Marketing, Communications and Business Development Our brand is the thread that runs through all the team is to find relevant forms and channels of activities in which PwC is globally engaged. It is a communication that allow us to address our various cornerstone of the quality we represent. The PwC stakeholder groups. brand helps us stand out, while at the same time obliging us to stay true to our values and enhance All members of the PwC network have a staff the value of our brand. member in their Marketing, Communications and Business Development team whose duty is to As a global network, we must protect our brand ensure that all communications materials comply elements with great care and attention so that they with the rules and principles concerning the PwC are clear and consistent. A brand is more than brand and trade name, as determined by the PwC just a logo, a set of colours, style or imagery; it is Global Brand team. Our aim is to present a uniform about personal relationships and human emotions. corporate image, whether in print publications, It allows us to tell a powerful and well-formulated sports sponsorship arrangements, client events or story through our people and to articulate our press releases. common goal: we strive to build trust in society and solve important problems.

8 I Sustainability Report – 1 July 2019 – 30 June 2020 Media appearances in the 2020 financial year

In the financial year ended on 30 June 2020, we had 1,483 media appearances. Number of followers per Key topics of PwC’s media appearances: channel (rate of increase):

■■ Hungarian and global CEO surveys, ■■ employee preference survey, ■■ the impact of artificial intelligence on jobs in Hungary. 642 new followers (Note: this media analysis was prepared by IMEDIA based on its own media appearance analysis tool.) 1481 new followers Managing our client database is also the responsibility of the Marketing, Communications 818 and Business Development team. In the 2020 financial year, we received no complaints of new subscribers abuse of personal client information, loss or unauthorised use of client data.

Social media Number of posts/videos:

280

208 74

9 I Sustainability Report – 1 July 2019 – 30 June 2020 Our values

At PwC, we strive to address the world’s biggest challenges, working together to solve important We build trust and solve important problems and build trust in society. We facilitate the operation, adaptation and development of complicated problems together. systems – whether capital markets, economic or tax systems – in an increasingly complex and fast-paced world in order to enable them to benefit communities and society. We aim to support our clients in making informed decisions and operating in an efficient manner.

Our values drive who we are, what causes we support and how we behave. We have shaped our values together and we all play a role in making these values show in our day-to-day operations. These values help us Act with integrity Make a difference Care Work together Reimagine the achieve our goals. possible

We speak up We are informed and ask We aim to We co-operate and share We question Despite the different backgrounds and cultures in which for what is right, questions about our future. understand all our relationships, ideas conventional ways and we work within the PwC network, we have common especially when it ■ parties we get in and knowledge within try new paths. values all over the world. Our values guide us in our feels difficult. With the help of our contact with. the PwC network. ■ conduct with our clients and colleagues, and make us ■ colleagues, our clients, ■ ■ We innovate, test and responsible for delivering the best possible performance We expect and and social groups, We acknowledge all We seek and integrate learn from failure. in all cases. This is the key to our success. aim to achieve the we make an impact contributions to a a diverse range of ■ highest professional through our actions. common cause. perspectives, people We seek opportunities The trust of our clients, employees and communities in standards. ■ ■ and ideas. in all ideas. PwC as well as our high ethical standards guide us in ■ We respond promptly We cherish each ■ all our activities. Our values constitute the foundation When making to the challenges other’s development We provide and request for our Code of Conduct, which serves as a reference decisions and presented by the constantly and let everyone feedback to develop framework for our everyday decision-making and performing our changing environment in perform at their best. ourselves and each business activities. activities, we which we operate. other. behave as if our own reputation were at stake.

10 I Sustainability Report – 1 July 2019 – 30 June 2020 Values in times of crisis – ADAPT Which current and future consequences do these trends have for organisations, the industry and the society at large? How can we shape them and respond to them? The market economy is the most powerful driver of social changes ever. Whereas the majority of trends is governed by an obvious set of rules, there is a growing number of In 2017 PwC’s experts identified a set of urgent challenges the world was confronting challenges which are either not being dealt with or are not being efficiently handled by and captured their findings in a framework called ADAPT. The framework analyses and the current system. Such challenges are posed by climate change, as well as the different considers these problems in a manner which enables us to take positive steps towards forms of economic exclusion and inequality. The world is grappling with system-wide tackling them. problems, which the coronavirus pandemic has shed even more light on. The coronavirus pandemic has brought about significant economic and social changes Values become accentuated in crisis situations. Corporate goals were a major concern which have accelerated existing trends and now demand prompt solutions from economic for CEOs already before COVID-19, and have gained even more attention now. This is and social players. a moment in history that provides an opportunity and incentive for all organisations to consolidate their goals, i.e. to focus on responding to principal and substantial issues: Why do we exist? Why are we here? Whose needs are we here to meet?

We’ve identified five key, long-term megatrends that are shaping our clients’ and our business’s future:

Asymmetry Disruption Age Polarisation Trust Increasing The pervasive Demographic Breakdown Declining wealth disparity nature of pressure on in global confidence in the and the erosion technology business, social consensus and a institutions that of the middle and its impact institutions and fracturing world, underpin society class on individuals, economies with growing society and the nationalism and environment populism Demographic and social Shifts in global Rapid urbanisation change economic power

Climate change and Technological advances It is our aim at PwC to find solutions and develop innovations for these pressing resource scarcity problems, as well as to empower society to navigate the new world, in a manner that focuses attention on the opportunities opened up by technology and takes human and environmental aspects into account at the same time.

11 I Sustainability Report – 1 July 2019 – 30 June 2020 Our people

PwC’s most valuable assets are our people because PwC employees they have the knowledge, professional expertise and experience on which we build our services. This is enriched by a wide variety of human factors that carry the feeling of belonging to a community. At PwC we focus on ambition, competence, flexibility, leadership and networking skills and develop them every day. These characteristics help our current and future colleagues to be successful in both their private lives and their work.

Our total staff in Hungary numbered 835 according to statistical data as of the last day of the 2020 financial year (including full-time and part-time employees and interns). Our people work in the following areas: financial consulting and advisory; audit; tax and legal; business and technology consulting; marketing, communications and business development; human capital; finance; IT; and infrastructure and 2019 2020 procurement. 816 Employees 835 The workplace is a space for self-fulfilment 731 Full-time 678 in a community. employees

Part-time 85 employees 157

81 Interns 77

12 I Sustainability Report – 1 July 2019 – 30 June 2020

Staff numbers by position, gender and age Turnover according to age and gender

Partners FY19 FY20 FY19 FY20 FY19 FY20 123 138 30-49 3 4 11 11 Female 88 136 50-69 1 1 5 5 101 103 Male 107 124

170 186 Under 30 137 166 Staff 10 colleagues had the FY19 FY20 FY19 FY20 53 59 opportunity to go on 30-50 Under 122 194 166 145 secondment abroad 50 92 30

30-49 1 1 196 204 212 164 above 50

8 2 50-69 8 17 11 13

New Leavers joiners

Interns

FY19 FY20 FY19 FY20 Under 44 48 30 37 29 2 colleagues joined PwC’s management

PwC’s headcount is characterised by constant minor fluctuations, reflecting changes in the labour market, development of the annual business figures and the individual interests of our colleagues.

13 I Sustainability Report – 1 July 2019 – 30 June 2020

Remuneration At PwC, we aim to make life more pleasant and easier for our people. We offer free, unlimited coffee to keep people going during the week, and on Friday evenings they can start off the weekend with a complimentary spritzer at the bistro downstairs. We endeavour to enhance our people’s Cafeteria, insurance, promoting health, paid company holidays, health with various free or discounted specialist medical Remuneration learning & development, sports, flexitime, company events, examinations, general medical consultation, and weekly sabbatical leave, high-tech equipment, fruit day fruit days. We arrange for many discounted services to be offered in our office (massage, shoemaker, tailor, dry cleaning).

Promoting a healthy lifestyle Other Instant recognition card, loyalty recognition, success story award for incentives teams, Key Talent programme Physical activity is part of a balanced lifestyle. To that end, we offer our employees sporting opportunities, including

■■ weekly in-house Pilates classes ■■ team sports organised by PwC (soccer and volleyball) Financial ■■ MOL Bubi (public bicycle fleet) pass New business bonus, referral bonus, project bonus incentives ■■ in-house Step Counting and Cycle to Work competition ■■ running competitions ■■ Summer Fest – summer sports day ■■ Care4Life – promoting a healthy lifestyle

Variable pay Company bonus and/or sales incentives

Guaranteed BASE pay

14 I Sustainability Report – 1 July 2019 – 30 June 2020

Lunch & Learn Cafeteria plan We think it is important to share our expertise and In 2020 the following benefits knowledge not only with our clients, but also in-house, could be chosen: which is the purpose of our Lunch & Learn events. Our colleagues give presentations on internal projects and services (e.g. PwC’s software that analyses and evaluates Tickets for cultural Language course Fuel card top-up SZÉP Card – hospitality football players) and other matters of interest (PwC’s events support (Only for company car assessment of employee preferences and the results of users) PwC’s CEO Survey), with buffet-style lunch provided.

Summer Fest

In June 2020, because of the epidemic situation, we found Cash allowance Tickets for sporting Support for SZÉP Card – SZÉP Card – leisure an innovative way of organising our summer fest to mark (Cafeteria benefit paid events nursery/ accommodation the end of the financial year. With the required technological in cash) kindergarten fees background at hand, our employees had the choice of various online activities to join from the comfort of their homes. The main activity was still sports: our colleagues participated in e-workouts, quarantine training, yoga classes, and there was also a cocktail and cookie making workshop, wine tasting, an online quiz and a guided art PwC Outlook – inspiring people, interesting stories exhibition.

It is important for us to provide our colleagues, most of whom are trained in business and economics, with inspiration from other sources, to present auditors and tax advisors fascinating and valued people outside their professional field, and that is why we have launched PwC Outlook. This extraordinary year, in which we could enjoy five out of the originally planned eight events, we had current topics of general interest and exciting stories of successful professionals in our offering. Among the guests of the hour-long moderated conversations we welcomed a musician, an actress, a poet, a director, an education expert and a hostage negotiator.

15 I Sustainability Report – 1 July 2019 – 30 June 2020 Employer-employee relationship Recruitment and selection

It is our shared goal to work with the most talented and most To have the best professionals, we need to find and attract excellent experts, and to make PwC an attractive workplace for the most talented workforce. The work of our Recruitment professionals who can identify with us and our values. It is therefore team within Human Resources involves hiring new The main reason why I find PwC important to make our employee brand promise not just appealing colleagues according to market needs. We are present an attractive workplace is that but also credible. on several online platforms and events where prospective they offer the opportunity to work employees can get to know our firm and the positions we with the most influential market Along with the values that PwC represents globally, our employees offer. players and management from expect us to provide them with the following: various industries.”

Welcome bites

New joiners get acquainted with professional and Opportunity Continuous Diverse Teamwork Friendly community activities based on PwC’s values in small to become development clients & culture workplace I greatly appreciate teams and in an interactive manner on their first day an expert sectors the flexibility that PwC with us. They can gain deeper insight into an activity provides.” they choose (e.g. pro bono volunteering, innovation We place value on regularly updating the above list and validating opportunities, digital skills development) already on their our messages to potential employees based on the results. To this first day. end, we conducted the CEE Employee Value Proposition survey in spring 2020, which was completed by 287 colleagues from the Hungarian office. According to the answers provided to the mini questionnaire, PwC’s propositions show the following order “ of importance for the employee target groups (career starters, Having worked at PwC for ten experienced colleagues, technology experts): years, I am convinced that Creating a healthy and you can find the best safe working environment, ■■ opportunity to work with the best professionals colleagues here – both protecting our colleagues, ■■ opportunity to become an expert personally and professionally.” and ensuring that persons ■■ continuous development involved in recruitment have ■■ positive and respectful working environment a positive experience are equally ■■ network of diverse clients, sectors and countries important to us. This is why we recruited ■■ teamwork in a fully online manner during the ■■ rapid professional development COVID-19 pandemic. ■■ high professional standards ■■ working together with experts from all over the world Orsolya Kelemen, Head of Recruitment and Employer Branding

16 I Sustainability Report – 1 July 2019 – 30 June 2020 Wellbeing of our people during the pandemic Training PwC’s purpose is to build trust in society and solve We have invested in innovative solutions at PwC Hungary We pay particular attention to ensuring that our important problems. A few months ago we could not have and in the global network for years, and the current people have extensive and up-to-date knowledge, thought that we would have the opportunity to fulfil that circumstances afford even more opportunities for online so they can meet the highest professional purpose in our daily lives, and not just by our individual learning. We launched our “Digitise CEE” programme in standards. We develop our business-specific conduct but also by taking collective actions to stop 2019. While we gain experience in co-operating with each training structure accordingly, and continuously spreading the coronavirus. Our primary goal is to maintain other and our clients by working mostly from home, the improve and update our training offerings. Training continuous operation and quality of work while doing programme can reach its highest potential in practice. courses are offered in consulting, negotiating skills, everything we can to keep ourselves, our people, our We hope that after the pandemic we will resume normal assertiveness, presentation skills and many more families and our clients healthy. operations as a community that has progressed to the next areas. level in digital skills and in rethinking their operations. Home office Training hours As a tech-enabled company, we have a great deal of experience in home office work, and the last couple of 97,838 months have proven that we can conduct our day-to-day business smoothly from home.

Within the PwC network, we have access to all of the G-suite applications: we use Google Meet, Chat, etc. in our daily communication. Video conferences with our clients run seamlessly. Our auditors are generally active in maintaining relationship with clients through online channels. They use a well-established system that organises incoming and outgoing mail, and sends alerts of mandatory notices and information requests.

17 I Sustainability Report – 1 July 2019 – 30 June 2020 We need an entirely new human resources management strategy: performing work and building communities is being transferred to a hybrid world, schedules and forms of work are changing, organisational communication is undergoing transformation, digital maturity is becoming more prominent, and this requires new skills from both employees and management. Home office has various advantages: it enhances organisational trust, adds more empowerment to corporate culture, may improve work-life balance, and may result in cost optimization, among others. Companies will be interested in maintaining this arrangement in the future.”

Tímea Rákos, HC Leader

18 I Sustainability Report – 1 July 2019 – 30 June 2020 Tips for the quarantine

To support mental and physical well-being of our people, we provided them weekly tips on how to cope with isolation and frustration arising from social distancing, as well as The advantage is with employees who adapt easily; they are creative and open to digital how to keep work and home life apart when all family solutions. There is more emphasis on these skills now, but this agile way of working can members are at home together. They also received tips be burdensome if proper conditions and support are not provided. We should prepare our on leading a sustainable way of life at home, setting up employees for the challenges presented by the new situation, maintain a continuous dialogue an ergonomic work station, joining online events, courses, with them, communicate transparently, request feedback from them, and let conclusions guide creative games, entertainment programmes for children, us in setting up a new way of operation. In the long run, the trust we place in our people will pay off.” doing project management for quarantine learning, and guidance for planning a new future. Tímea Rákos, HC Leader

Mental coaching

During the pandemic period, which was marked by remote work, we supported our colleagues with individual and group resilience coaching to keep them mentally healthy.

Show off your home office

Forced by the coronavirus pandemic, we switched to working from home without any disturbances, and we all had different ideas for shaping our home office space. We invited our colleagues to show from where and how they work when far from the office building.

19 I Sustainability Report – 1 July 2019 – 30 June 2020 Diversity

The PwC network is committed to creating and supporting Care4Life an inclusive workforce. We employ people from diverse cultures and backgrounds and with a wide range of We launched our Care4Life programme in 2019 to experiences. We’re committed to making sure everyone encourage our people to take part in both existing and new who works at PwC feels comfortable bringing their true activities to improve their physical and mental well-being. selves to work. Advancing and supporting diversity and inclusion isn’t just the right thing to do. An inclusive Our Care4Life website provides content on healthy eating workplace enables us to embrace the diverse backgrounds habits, physical and mental activities, prevention, and and perspectives of all our people to create better recommends related events. outcomes for stakeholders and society.

Our diversity efforts focus on the following three areas:

■■ reintegrating employees returning from maternity leave, ■■ supporting women’s career paths, ■■ providing flexible forms of work, especially for workers with children. Equal pay We build a corporate culture that offers innovation, continuous learning and professional development, in which We regularly conduct comprehensive reviews of we work flexibly, thus supporting work-life balance. compensation data (pay equity reviews) to understand any differences between genders and positions, and make adjustments as appropriate.

20 I Sustainability Report – 1 July 2019 – 30 June 2020 Common cause Programme guide for parents with small children As an employer, one of our main goals is to increase the proportion of women in management positions and to support women’s career paths. Digital schooling posed real challenges to parents working In November 2019, we joined the “Common Cause” campaign of the non-profit organisation WeAreOpen because we for PwC. Finding activities for small children, helping believe that women and men should have the same opportunities in the workplace and we must work together to make schoolchildren in distance learning, and submitting their this happen. We made commitments in the following areas: assignments is especially hard when we have piles of work to do. Therefore, in addition to recommending summer ■■ increasing the proportion of part-time positions, camps, we set up a “timetable” with activities and ideas ■■ expanding flexible working arrangements, (e.g. exercising, storytelling, arts and crafts) for children. ■■ providing schemes to support employees returning from parental leave. Some of our colleagues’ children supported the programme by reading tales aloud.

I believe that diversity is a competitive advantage. More perspectives, more interests and diverse people will enable a company to better understand its customers and provide the best for them. However, being diverse is not easy. It requires a lot of effort to learn how to work well together and pay attention to each other. We as leaders must show the way.”

Tamás Lőcsei, CMP

We would also like to empower fathers at home by offering them flexible work schedules or longer leave at the birth of a child. Those who have taken advantage of this opportunity have returned with positive feelings, which is an encouraging example for future fathers.

Márta Szűcs, Diversity Partner

21 I Sustainability Report – 1 July 2019 – 30 June 2020 Our strategy

Our CR strategy, both globally and locally, focuses on mentoring the next generation, and developing innovative business solutions. We aim to achieve measurable and lasting positive changes in society and the environment. Our annual sustainability report on our corporate responsibility initiatives provides transparency and contributes to keeping our stakeholders informed. Our report presents our corporate responsibility programmes, our plans, and identifies the areas that need improvement. We believe that we can create permanent and sustainable value for our direct and indirect stakeholders through our core professional activities, technical expertise and related services. Accordingly, throughout the financial year, we provide professional assistance or pro bono services to NGOs, involving as many of our colleagues as possible.

CR management

Our Marketing, Communications and Business Development team is responsible for our firm’s CR function. They coordinate and monitor projects, action plans and initiatives concerning our CR strategy, and ensure that our internal and external CR communications are consistent and uniform. Conceptual and strategic CR planning is the task of the CR strategy team, Businesses have which includes the head of Marketing (Borbála Palotai), the CR Manager a key role to play in (Katalin Simon), and two partners from the Assurance service line (Balázs tackling social problems. The PwC Mészáros and László Radványi), who provide technical support to the CR team. network is committed both globally Planning is carried out in consultation and cooperation with our CMP, while and in Hungary to sharing knowledge specific programmes are organised and implemented by our staff. The content and providing technical assistance. of our Sustainability Report is approved by Balázs Mészáros, Partner. Training activities and developing digital skills constitute important elements of our CR strategy.” Approval CR Partner (Balázs Mészáros) with the CMP’s approval Balázs Mészáros, Partner, CR Leader Strategic planning The CR Strategy Team: Borbála Palotai (MCBD Leader), Katalin Simon (CR Manager), Balázs Mészáros and László Radványi (supporting Partners), and Cecília Szőke (CEE CR Manager as facilitator)

Implementation PwC employees

Project coordination and communication Marketing, Communications and Business Development Team

22 I Sustainability Report – 1 July 2019 – 30 June 2020 Our CR strategy

PwC’s commitment to sustainable development is reflected Good health and well-being Gender equality in the financial and social added value that our services The health and well-being of our staff is Gender equality is one of the focus areas of help create. We build trust by offering solutions to the most our number one priority. We offer various PwC’s global diversity strategy. We provide pressing issues through the skills and knowledge of our programmes and flexible options to help them equal opportunities regardless of gender, people. improve their quality of life in addition to work support women’s career paths, and aim quality. We also support social causes that to increase the proportion of women in PwC is proud to have been a signatory to the UN Global improve the living conditions of disadvantaged groups. leadership positions. Compact (UNGC) since 2002 and is deeply committed to its ten principles in the areas of human rights, labour, Quality education Decent work and economic growth the environment, and anti-corruption. We report on our activities in the Communication on Progress every year. Our people are our greatest asset, and We look for opportunities not only through Click here for the latest report. keeping their skills and knowledge up-to- our CR activities, but also in the services date is key to our success. We believe that we provide, to contribute to sustainable We align our operations and strategy with the 17 education and providing future generations development both locally and globally. As an Sustainable Development Goals and related commitments with the skills to meet the challenges of the engine of change, we support our clients in adopted by the UN in 2015. Of the 17 Sustainable digital age play a crucial role in societal success, so we their efforts to promote sustainable development, integrate Development Goals, our strategy focuses on goals that our share our knowledge by making it widely available. sustainability aspects into the services we provide, apply industry can have the most significant impact on and that the latest digital technologies in our operations, provide afford us the greatest opportunity. a job to nearly a thousand people, and make significant contributions to the local economy through our fiscal (tax) payments.

Climate action We pay special attention to reducing our environmental impact, apply environmentally- friendly office solutions, and strive to reduce our business travel.

23 I Sustainability Report – 1 July 2019 – 30 June 2020 Our community strategy

In accordance with PwC’s community investment At the time of writing this report, we had helped 8.5 strategy announced in 2018, we will contribute to million people improve their opportunities through the training and skills development of 15 million various training and educational programmes. people globally by 2022. Under this initiative (Maximising Potential) we focus on three target In September 2019, we announced our “New world. groups: participants in education, non-governmental New skills.” initiative, which seeks to prepare societies organisations (NGOs), and social and micro for the labour market challenges of the future. As enterprises. part of that initiative, we work with a number of

Skills and education organisations to provide training to disadvantaged people, and have made our Digital Fitness App freely available to people and communities across the world. This free version of the app empowers people to stay relevant, boost their digital acumen, and access resources to help them navigate the digital age.

organisations Non-governmental In addition, we have entered into a collaboration with UNICEF that aims to help upskill millions of young people. The collaboration will support Generation Unlimited, a multi-sector partnership aimed at helping 1.8 billion young people to get access to education and develop the right skills to succeed as adults. Social and micro enterprises

24 I Sustainability Report – 1 July 2019 – 30 June 2020 Our environmental strategy Elements of our approach:

PwC’s global environmental strategy comprises three pillars.

Measuring & Driving efficiency Switching to Managing our air Offsetting Extending our efforts understanding renewables travel impact unavoidable to a broader scope our impact emissions and supply chain

We are reducing our carbon footprint through driving efficiency (by reducing our business PwC is investing in a range of voluntary carbon offset projects to mitigate the impact of our air travel emissions. Carbon offset travel and adopting efficient online business projects not only reduce greenhouse gas emissions but also allow us to take responsibility for the impact of our operations while solutions). we investigate longer-term solutions.

PwC has made a commitment to achieving net zero carbon emissions by 2030.

The PwC global network has announced a worldwide science-based commitment to achieve net zero greenhouse gas emissions by 2030. Within the next ten years, PwC will decarbonise its operations, including our travel footprint, and invest in carbon removal projects to compensate for residual emissions. We will be sourcing 100% renewables for our electricity consumption by 2022. What does this mean in practice?

■■ PwC is committed to decarbonising its operations and supply chain, which includes transforming how we service our clients (e.g. through increased adoption of online meeting technologies, and not just for the duration of pandemic-related lockdowns), permanently reducing our business travel, and increasing our use of zero-carbon energy. ■■ We are integrating climate-related and other environmental-, social- and governance- (ESG) related factors into our work with our clients, from strategy to implementation. ■■ PwC continues to work to improve corporate reporting standards that promote reliable non-financial reporting practices (PwC Hungary has been preparing sustainability reports since 2012 and provides sustainable business solutions to its Since 2019 we have been offsetting clients). 100% of our air travel emissions. ■■ We remain committed to long-term research and collaboration programs with other companies, policy makers and NGOs to accelerate the transition to a net zero economy. We have been playing an active role in the work towards achieving the UN Sustainable Development Goals. At the local level, we work with organisations such as the Business Council for Sustainable Development in Hungary (BCSDH) and Volunteering Hungary – Centre of Social Innovation (ÖKA), among others.

25 I Sustainability Report – 1 July 2019 – 30 June 2020 Standard measurement system across the global PwC’s global results for FY 2020 PwC network Community investment (USD) Members of the PwC network report their data at the end of each financial year (by 31 July). As part of this process, we report on our performance with respect to the community and the 187,592,456 (FY19 187.5 m) environment, and aggregate data from members of our network into PwC's Global Annual Review.

82,906,447 24,770,769 64,461,431 15,453,809 Cash and in-kind donations Volunteer Pro bono and discounted Management hours engagements costs

Number of volunteers

47,864 (FY19 61,284)

26,246 21,618 Skilled and General participants professional participants

Volunteer hours

816,805 (FY19 925,818)

640,298 176,507 Skilled and professional General hours hours

Total carbon emissions Carbon emissions from air travel

FY20 FY20

432,372 t CO2 357,998 t CO2

FY19 599,258 tons of CO2 FY19 504,962 tons of CO2

26 I Sustainability Report – 1 July 2019 – 30 June 2020 Our community initiatives -#pwctegyunkerte At PwC, our purpose is to build trust in society and solve important problems worldwide. We believe that businesses have a key role to play in addressing societal issues.

Today, the systems that underpin societies are facing unprecedented challenges. As a business, we have a responsibility to actively support the development of these systems so that they bring wider benefits to communities.

This is particularly important in the context of the growing gap between economic growth and social progress. For many years, globalisation, digitisation and technological change fuelled global economic growth, resulting in a continuous improvement of many people’s lives. At the same time, many countries have also experienced high levels of mistrust and dissatisfaction in increasingly large sections of their population, as access to resources and the benefits derived from that access are distributed unequally among different geographies and social groups. To address the causes and drive change, we must restructure social and economic systems – which includes changing the role of business in both.

27 I Sustainability Report – 1 July 2019 – 30 June 2020 Volunteer Day Offering free access to our venues Our latest Charity Week We have organized our Volunteer Day, our most popular Thanks to our office layout in the Eiffel Palace, we have in numbers community event, annually since 2014. In autumn 2019, a conference space where we organise both internal more than 350 PwC staff visited almost 50 non-profit and external professional or community events. In the organisations, foundations, schools and social enterprises past financial year, we provided nearly 152 hours of Charity bake sale Christmas to get acquainted and to donate their labour and skills. access to our venues free of charge for various non-profit Many skilful confectioners + fair more than 30 kinds of cookies 6 organisations, organisations and events. and cakes + one enthusiastic 1 choir What does this day mean to our colleagues, barista + lots of sweet-toothed and what other good causes did they and kind-hearted colleagues = HUF 300,000, raised to support support? 1% campaign the medical The Burattino School Choir, Watch our video to find out! treatment of Tomi, a participant in the Superar Music a staff member’s We believe it is important that our employees extend social Program, provided musical little boy. responsibility also to their private lives. To this end, we entertainment at the fair Charity Week launch a campaign every year to call their attention to the importance of donating 1% of their personal income tax. As In December we welcomed the holiday season by drawing usual, we prepared a list of non-governmental organisations attention to important causes. Our Charity Week included and foundations we come into contact with during the year, a bake sale to support a foundation for a colleague’s child, while our colleagues could also suggest organisations they from donations offered in return for delicacies prepared knew and supported. Kriszta Kőmíves holding by our staff members. We also had a Christmas market, a bake sale masterclass where various social enterprises offered their wares, and we organised a blood donation drive. Blood donation

Together with the Hungarian Red Cross, we organise blood donation drives in our office three times a year. Due to the Cash value of in-kind donations: coronavirus pandemic, we only managed to hold two such events this year, with a total of 65 participants. We strive to HUF 2,251,000 increase the impact of these events by inviting staff of other tenants in our office building, in addition to our own.

Ricsi Molnár in multitasking mode Note: The number of people signing up for blood donation is always higher than the number of those who can actually donate following a medical exam. We quote the latter figure in our report.

Blood pwc.com/hu/cr donation 33 blood donors

28 I Sustainability Report – 1 July 2019 – 30 June 2020 Staff fundraising for hospitals and social institutions General volunteer activities In mid-March, we launched a fundraising campaign among our staff to purchase equipment for healthcare workers in the front line of the fight against the pandemic, and raised The restrictions caused nearly HUF 3 million. We used these funds to support a by the coronavirus made number of health and social care institutions: we purchased it really difficult for high- washer dryers for the Szent János and Szent Imre Hospitals Number of Number of Number of PwC school students to prepare for in Budapest, Magyar Imre Hospital in Ajka, and the National volunteer hours beneficiaries volunteers their final exams last year. As a Korányi Institute of Pulmonology, a refrigerator for SOTE’s member of the student organisation Emergency Care Department, an air purifier and face 2781 53 358 Studium Generale, I helped seven high- shields for Honvéd Hospital, washable masks and face school students prepare for their advanced- shields for Markusovszky Hospital in Szombathely, and level final exams in History by holding online also washable masks for several social care institutions in classes in April. They were really grateful Gödöllő. In addition, we bought twenty thousand pens for Our staff members are involved in various volunteering efforts for the opportunity, as they were missing the National Blood Transfusion Service, to be used in blood throughout the year, and their volunteer work was especially personal interaction, which is difficult to donation campaigns, and donated HUF 500 thousand important during the lockdown. implement with full classes on an online to each of Semmelweis University Foundation and the platform, so they were more inclined to ask National Ambulance Service Foundation. questions, and the exam topics could also be tailored to their interests. I have been in contact with them ever since, and received only good news. :)” I asked friends who work in hospitals about what they Anett Ardelean, Advisory needed most, and it turned out that they had no face shields at all. I have found a small company with a very kind and enthusiastic leader, and with their help and our funds and energy, we managed to produce and deliver 5,000 face shields to those that needed them most. My colleagues and I also explored the needs of various hospitals and, thanks to PwC Hungary’s management and CR / Marketing team, our staff were able to contribute to this effort. We managed to raise the funds for the required equipment very quickly, and I could happily deliver the washer dryers, the refrigerator, etc. to the hospitals. I was greeted with smiles that shone through protective gear, expressions of gratitude, and human stories.”

Kata Szalóki, Government Advisory

29 I Sustainability Report – 1 July 2019 – 30 June 2020 Technology is ubiquitous. Its benefits are pervasive and are fundamentally changing the Skilled volunteer activities way we live. It provides access to information in previously isolated areas, contributes to an increase in life expectancy, changes the range of products and services available, and increases the efficiency and responsiveness of organisations. However, the rapid pace of technological development has also brought to the fore challenges (inequalities, layoffs, institutional failures, social exclusion, loss of privacy, excessive wastefulness) that need to be addressed. Number of Number of PwC Number of beneficiaries volunteers volunteer hours Education and having the right skills are key to putting technology at the service of positive change and having a positive impact on people’s lives. In order to use technology responsibly, we need to understand and learn how to manage it, with all its advantages Professional volunteer 443 45 1445 activities and drawbacks. PwC’s global New world. New skills. initiative is aimed at ensuring that everyone has the opportunity to succeed in the digital world.

Education is one of the pillars of competitiveness for both society and individuals. It is Pro bono 5 23 615.8 difficult to prepare learners for rapid technological advances under the conventional training engagements models, which is why educational policy poses many challenges almost all over the world. Lifelong learning is gaining increasing importance. Quality education is one of the globally adopted Sustainable Development Goals (SDGs). Based on our core activities, supporting quality education and using our assets to contribute to the development of the Hungarian Discounted 3 14 363 educational system are focus areas. engagements

134 34 284.5 New world. New skills. volunteer work PwC has worked for Digitális Jólét Nonprofit Kft., the organisational backbone of the Artificial Intelligence Coalition, in two engagements. One of our engagements New world. New skills. was to develop an operational model for the Artificial Intelligence Innovation Centre, a strategic organisation that The growing mismatch between the skills people have today and those needed for the supports the development of an AI ecosystem with a broad digital world is a pressing challenge, but it is also an opportunity for PwC. mandate. The other engagement involved advisory support for drawing up the strategy itself. We drafted the text of the strategy together with the In our global corporate responsibility strategy, we set an ambitious target: to invest in the professional leader of the Coalition, based on input from the Coalition’s future and growth of 15 million people, NGOs and social and micro enterprises to help experts, solicited expert opinions, provided an international perspective, them maximise their potential by 2022. This programme forms the basis of our community structured, supported and gave a visual representation to the strategy.” initiatives and provides a framework for addressing social problems on a local level. We believe that together we can make a significant difference in the digital upskilling of Csilla Stéger, Government Advisory, education expert communities, which is key to tackling social inequalities.

30 I Sustainability Report – 1 July 2019 – 30 June 2020 Basically, we perform knowledge sharing and development activities by offering pro bono services, training and mentoring.

State aid is usually a new topic to students, as few of them We are invited usually twice a year to teach and give have to deal with it in their daily lives, so my goal is to workshops in the field of audit evidence for Master’s provide students with a general and comprehensive picture students studying accounting at Corvinus University in of state aid, which helps them recognize (possibly unlawful) Budapest. Based on the feedback, students have found our state aid in their work or when reading the news.” presentations very interesting, and we have also met several students at PwC events (e.g. at the Assessment Centre) and welcomed some of Zsuzsanna Remetei Filep, them later as audit colleagues. We’ve had colleagues who said they joined PwC Tax & Legal Services partly because of our presentation.”

Kinga Kőmíves, Assurance

Digital education guidelines for teachers and parents 1 Preparation 1 Preparation Digital education 2 Deliver course materials Digital education 2 Deliver course materials – but how? 3 Testing and evaluation – but how? 3 Testing and evaluation 4 Communication 4 Communication When developing new forms of education necessitated by school closures, it wasn’t always Digital instruction ≠ remote frontal instruction easy to choose the right applications or to learn how to use them. That’s why we prepared 1 Preparation 2 Deliver course a publication which uses infographics to summarize each step in digital learning: from ■ Collect contact information from pupils/students & parents materials ■ Assess technological prerequisites: computers, tablets, mobile phones, Internet connection ■ Create courses assessing the availability of tools through developing a uniform platform to the various ■ Choose a uniform, commonly used platform ■ Assign tasks ■ Invite pupils/students to learning groups applications used for testing and communication. ■ Set a regular work schedule: daily/weekly to-dos ■ Put events, deadlines for tasks, and consultations into a calendar ■ Provide continuous feedback to students and parents Course materials and books for self-learning

Learning management systems Internet safety training for kids – your one-stop shop Practice what you Other creative tools for have learned! teaching and learning

As part of PwC’s global training programme “New world. New skills.”, our experts at Risk Use these services to share large files Assurance Services (RAS) have helped pupils aged 10-11 to navigate safely in cyberspace. In online classes, we talk to students about topics such as cyberbullying, protecting © 2020 PricewaterhouseCoopers Könyvvizsgáló Kft. All rights reserved. This publication is for general information purposes © 2020 PricewaterhouseCoopers Könyvvizsgáló Kft. All rights reserved. This publication is for general information purposes personal information, or using mobile apps safely. In FY 2020, our experts delivered cyber only, and should not be used as a substitute for consultation with professional advisors. only, and should not be used as a substitute for consultation with professional advisors. security lessons to 40 pupils.

31 I Sustainability Report – 1 July 2019 – 30 June 2020 Civil Mentoring

We have launched our pro bono mentoring programme for non-profits for the fourth time. The topics were adapted to the needs of the organisations that applied, based on the experience of previous years. The five-module training series covered the following topics: formulating a mission statement, motivation, and objectives; crisis management; business planning; corporate relations and service development.

Based on presentations drawing on the acquired knowledge, we have selected six organisations with which we will continue our cooperation under a six-month mentoring programme. Working together with these organisations, PwC staff will support the development of specific projects (e.g., feasibility studies, organisational structure, sustainable sources of revenue).

Non-profit participants in 2020, our fourth year: Civil Mentoring Programme participants Felelős Gasztrohős Foundation Találj Magadra Association Rehab Critical Mass Foundation Volunteer day training Hungarian Deafblind Association Élményalap Our experts provided free in-house training for Hungarian Federation of People with Rare and Congenital representatives of non-profit organisations on taxation, Diseases (RIROSZ) information security, establishing corporate relationships, Káposztási Családok Association presentation skills, using social media and service Afrikáért Foundation development as part of our Volunteer Day in October. Hungarian League Against Cancer

Number of Number of PwC Number of Number of Number of PwC Knowledge-based beneficiaries volunteers volunteer hours beneficiaries participants volunteer hours 9 12 199.5 51 10 31

32 I Sustainability Report – 1 July 2019 – 30 June 2020 Our stakeholders

Companies are being forced to rethink their strategy due to the crisis caused by COVID-19. Our responsibility to our people and communities is now more important than ever. But it is not just about organisations being good corporate citizens; it is also necessary to demonstrate and communicate this to all stakeholders. This is because transparency increases trust, and trust creates long-term value for shareholders. Communicating reliable information is therefore key for all stakeholders.

33 I Sustainability Report – 1 July 2019 – 30 June 2020 Relations with stakeholders

Stakeholder group Communication tools Forms of cooperation in FY20 Development opportunities

This year, due to COVID-19, we did not conduct an employee satisfaction survey; however, Relaunching the employee satisfaction survey. we have introduced measures to help improve the physical and mental health of our Global people survey, annual Supporting the mental well-being of our colleagues is a key focus for us at people. performance evaluation, regular PwC. Employees career meetings and coaching, staff We have held internal events online, and in our internal staff magazine we have published Launching programmes that provide the experience of belonging to a events, internal staff magazine, inspiring stories. community despite the reduction of interpersonal contacts. newsletters We improve our internal processes through continuous technological innovation and offer Further expanding our professional knowledge bases, knowledge sharing, up-to-date tools to enhance our employees’ skills. facilitating cooperation between sectors.

Building relationships and demonstrating PwC’s expertise in various events, e.g. presenting Optimising client experience by considering environmental factors. Newsletters, professional events, the Hungarian CEO Survey, Future of Finance, wine dinners, programmes at the Budapest Enhancing user experience at online events. Clients studies, social media campaigns, Sports Arena. tenders Professional publications on the impact of artificial intelligence on the labour market, Mitigating the economic damage caused by the pandemic, introducing employee preferences, world economic forecasts, etc. personalised services.

Traditional dialogue with suppliers, Suppliers We work with responsible, certified suppliers. Further increasing the ratio of responsible suppliers. tenders, feedback

Participation in professional forums, Joint events, e.g. inviting Tax Authority experts to give online presentations during the Government and publications, surveys, membership pandemic. Preparing Hungary’s artificial intelligence strategy in cooperation with the Reviewing professional materials, active participation in the preparation as regulatory bodies in professional organisations, press Ministry of Innovation and Technology; participating in the development of an operational a consulting partner. Facilitating dialogue between regulators and businesses. releases model for the Artificial Intelligence Innovation Centre.

Youth surveys; participation in job fairs, open days and career days, Next generation, Participating in higher-education job fairs, online during the pandemic, and employee and academic competitions; youth Strengthening employer branding activities. potential employees preference surveys projects and competitions; social media campaigns

Participation in professional forums Local communities, and events, collaboration in non- Civil Mentoring Programme, in-house training day for non-profits, newsletter, pro bono and Adopting and sharing best practices, involving as many employees as non-profit profit projects, volunteer tasks, discounted services. possible in activities, and facilitating civil society cooperation. organisations pro bono services, training, and Cooperation with professional organisations, e.g. BCSDH, ÖKA, Civil Impact. Increasing the rate of digital skills development in training programmes. memberships

Newsletters, professional events, Maintaining our visibility through media appearances by PwC experts on Media studies, social media campaigns, Preparing press releases, expert interviews, professional articles and background materials relevant subjects. statements

Alumni club, events, newsletters, Alumni alumni magazine, social media, Circle – an informative magazine for former colleagues, twice a year. Creating additional opportunities to build and maintain relationships. training invitations

34 I Sustainability Report – 1 July 2019 – 30 June 2020 Employees

PwC aims to be the best employer by attracting and retaining the best talents. It is therefore particularly important to provide our employees with equal opportunities for development, show exemplary leadership, and recognise outstanding performance. We strive to create a culture of flexibility where work-life balance is critical. We support the wellbeing of our people with various programmes and motivate them to achieve outstanding performance, to acquire proficiency in digital technologies, and to continuously develop their knowledge. Celebrating our successes and spending time together outside of work are also key, as they promote a sense of belonging to our community.

We strive to equip our professionals with the skills and abilities they need to succeed in an ever-changing digital world.

Next generation, potential employees

To have the best professionals, we need to find and attract the most talented workforce. PwC’s recruitment team regularly participates in university career fairs. In the past financial year, our colleagues served as guest instructors in 12 higher educational institutions.

35 I Sustainability Report – 1 July 2019 – 30 June 2020 Our clients

PwC has been present in the Hungarian professional That’s why we create opportunities to meet and exchange for his research and publications on the loyalty business services market for over thirty years. During this time, we ideas with our clients on diverse platforms: business events, model and loyalty marketing), Bain & Company (a global have delivered value-added professional services to a large professional forums, trainings, cultural and sports events, management consulting firm) and Satmetrix (a U.S.-based portion of multinational and privately owned companies in and personal discussions. provider of customer experience software). A positive NPS Hungary. In addition to knowing our clients’ business, so we (the sum is greater than zero) is good, while an NPS over 50 can better support them, a key to our success is listening to is excellent. our clients. Client acceptance and retention In FY 2020, we scored a net NPS of 64 in our client In order to provide our services at the highest possible level PwC Hungary has implemented a process to identify feedback survey. of quality and to realise personalised ideas according to acceptable clients supported by the proprietary PwC changes in the economic environment, we strive to develop International decision support system for client acceptance PwC’s competences according to clients multidirectional and effective communication with domestic and retention (Acceptance and Continuance – A&C). This is companies. how the system works: the engagement team, together with The answer can be given on a scale of 1-5, where 1 is the worst industry specialists and risk management staff, consider and 5 is the best value. jointly whether the risks associated with an existing or potential client are manageable, and whether we want to do Organization level 4.6 business with that client and its management. Knowledge 4.71

Creativity 4.09 Client feedback survey Communication 4.79

Business impact 4.32 We have been soliciting online feedback from our clients Tailoring 4.45 as part of our Client Feedback Programme for years. The survey helps us measure the overall level of our clients’ Risk management 4.4 satisfaction with our services, and gives us the opportunity Relations 4.65 to identify areas that need further improvement. The survey is coordinated by two members of our Marketing, Communications and Business Development team. In the previous financial year, they implemented internal communications processes to promote the programme, automate certain parts, and communicate the results. In the client feedback survey, we use a measure called Net Promoter Score (NPS), which shows the loyalty of our clients. This metric is a branded joint development of Fred Reichheld (an American business strategist famous

36 I Sustainability Report – 1 July 2019 – 30 June 2020 PwC’s Hungarian CEO Survey

In this year’s publication we present a summary of the views of 223 Hungarian CEOs on economic outlooks, their organisations’ growth prospects, the opportunities and challenges in upskilling their workforce, climate change, regulating cyberspace, and digital privacy. In an uncertain economic environment, defensive actions may make tactical sense but are counterproductive even in the short term – if we reduce This is the ninth year PwC has conducted the Hungarian CEO Survey. We carried out the investment in people or pull back from new technologies, we are shying first survey in 2011, based on the PwC network’s Annual Global CEO Survey, which is now away from big challenges. Companies must lean into changes in the precise in its 23rd year. Based on in-person interviews, our survey provides unique insight into the moments when it is uncomfortable to do so. thinking and strategic direction of Hungarian CEOs, and enables comparison with the views of chief executives around the world. As a leader you don’t have control over demographic trends. You need to come to terms with the skills shortage and talent flight, and embrace the While the majority of Hungarian CEOs predict a necessity for upskilling. If you strike now, while the iron is hot, you will forge a slowdown in both Hungarian and global economic company made of solid relationships, while building a more agile workforce.”

growth in 2020, 80% of them remain confident about Tamás Lőcsei, their company’s prospects for revenue growth. CMP, PwC Hungary

81% 43% 29% Info-video about the Hungarian survey on PwC’s YouTube are confident about their expect to increase their are planning to enter a channel company’s prospects for revenue headcount in 2020 new market to boost their growth over the next 12 months company’s growth

37 I Sustainability Report – 1 July 2019 – 30 June 2020 Future of Finance The impact of artificial intelligence on the labour market

Hungarian CFOs are most concerned about skills According to a study by PwC Hungary, today’s most shortages, and only 4% of them see their digital solutions significant disruptive technological solutions – automation, as pioneering in finance and accounting, according to machine learning and artificial intelligence – will have a PwC’s Future of Finance survey. Published in autumn 2019, significant impact on Hungarian workers in the coming the survey findings show that in order to effectively address years. According to OECD data, Hungary is an industrial- the challenges of skills shortages and digitisation, CFOs focused economy, so the effects of technological changes need to focus on four areas: professional work, leadership, will be felt in the Hungarian labour market mostly from the management tasks, and relationship building. 2030s.

While this year compliance We estimate that more with accounting regulations than 900,000 jobs will be and standards was seen as affected by AI over the the biggest challenge, for the next 15 years. Based on next year the focus is shifting the structure of the Hungarian to automation and a change of IT economy, we believe that the systems. One of the main tasks of CFOs automation of manual, precision and will be to find solutions to these pressing monotonous tasks will have the biggest issues.” impact on the labour market.”

Gábor Balázs, Antal Kerekes, Partner Partner

38 I Sustainability Report – 1 July 2019 – 30 June 2020 How did we manage our client relationships during the pandemic at PwC Hungary?

At PwC, we strive to address the world’s biggest challenges, working together to solve important problems and build trust in society.

COVID-19 highlighted the pressing need for cross-border cooperation and aligning business operations with social and 27 human needs. We will most certainly not return to the old ways of doing things, but we have the opportunity to create a online presentations “new normal” where we can achieve harmony between economic and social development.

Supporting the business community during the pandemic >9,000 registered participants COVID-19 has significantly impacted all areas of the world economy. It is very important for us to keep our clients up to date on government decisions affecting 46 PwC experts made statements their companies. That is why we gave regular online presentations on accounting and regulatory matters, deferred financial statements, and the export and import implications of restrictions on the trade of goods. Our aim 7 guests gave presentations on behalf of was to support smooth and secure business operation the National Tax and Customs Authority, in accordance with the relevant laws and regulations. the Ministry of Finance, and the National We have responded to announcements by the Ministry Bank of Hungary of Finance, and we have also provided information on matters affecting society at large – for example, what can The conversations were watched live working parents do in the event of a school closure, and by more than what to keep in mind when working from home.

PwC Hungary’s experts have created a dedicated 4,000 participants, and over webpage for the business and non-profit sectors where all relevant information is available for organisations to prepare for the challenges posed by the pandemic. 5,000 watched on demand later

39 I Sustainability Report – 1 July 2019 – 30 June 2020 PwC’s team of specialists collaborated to create Navigator, a digital assessment tool to help businesses understand the potential impact of COVID-19 and gauge their readiness to respond. The digital tool contains questions that will help business leaders understand where their company stands as they respond to COVID-19 in the areas of: Our responsibility to At PwC Hungary, we crisis management and response; workforce; operations and supply others begins at home and have been using our chain; finance and liquidity; tax and trade; and strategy and brand. extends to the communities Digital Fitness app to keep in which we live and work. We us up-to-date on the latest are therefore pleased to share PwC’s trends in technology, learning methods free English-language Digital Fitness and tools for remote work, e-commerce app, which provides users with up-to- and many other exciting topics. Now this date knowledge on innovative topics app is available for free to anyone who such as cybersecurity, design thinking, wants to improve their digital skills. The and artificial intelligence. The app offers app’s content includes articles, audio and practical tips on these topics, which is video materials, so everyone can find the especially important in these difficult format that suits their preferences. For times.” example, I often listen to experts while PwC has made available its Digital Fitness app for free worldwide running.” until July 2021. The app allows users to assess their digital fitness Tamás Lőcsei, CMP and boost their knowledge in more than 60 digital trend categories. Balázs Mészáros, With the English-language app, individuals and organisations can Partner, CR Leader learn from industry leaders and experts about how business is changing and how they can stay ahead.

We have also published and continuously update our People Playbook, which answers the questions: What steps might companies be forced to take amidst the uncertainty caused by the pandemic? What tools do they have at their disposal to avoid downsizing and maintain their reputation on the job market? To answer these questions, our HR consultants have put together useful advice.

40 I Sustainability Report – 1 July 2019 – 30 June 2020 Our supply chain Partner organisations, memberships

We are putting special emphasis on the selection of our Due to our professional work, we are in contact with and engage in dialogue with many community groups, professional suppliers. We strive to develop long-term relationships with organisations, non-profit and regulatory bodies. We cooperate with or are members of the following organisations: them, thereby ensuring the consistent quality of the services we receive. We also aim to continually increase the number ■■ American Chamber of Commerce ■■ Hungarian Automotive Industry ■■ Business Council for Sustainable of our non-profit suppliers. Our supplier policy refers to ■■ Budapesti Értéktőzsde Zrt. Association (MAGE) Development in Hungary PwC’s Third Party Code of Conduct, which explains the ■■ Budapest Chamber of Commerce ■■ Association of Hungarian ■■ Artificial Intelligence Coalition minimum standards of integrity and business conduct PwC and Industry Automotive Component ■■ Confederation of Hungarian expects of the third parties with which it does business. ■■ Effekteam (formerly Hungarian Manufacturers Employers and Industrialists Donors’ Forum) ■■ Hungarian Private Equity and ■■ Deutsch-Ungarische Industrie- und Non-profit suppliers ■■ Győr-Moson-Sopron County Venture Capital Association Handelskammer Chamber of Commerce and ■■ Hungarian Hotel and Restaurant ■■ Hungarian Association of At our 2019 Christmas market organised in our office Industry Association International Companies building, charitable foundations and associations sold ■■ Association of ICT Companies ■■ Hungarian Service & Outsourcing ■■ Public Company Accounting goods created by disadvantaged people. The following ■■ Industry 4.0 Association Oversight Board organisations participated in our Christmas market: Bárka ■■ National Technology Platform ■■ Hungarian Competition Law ■■ NESsT Hungary Handicrafts Workshop, Őrzők Foundation, Kék Madár Association Irish-Hungarian Association ■■ Volunteering Hungary – Centre of Foundation, Hetedhét Határ Social Cooperative, and ART, Business Circle ■■ British Chamber of Commerce in Social Innovation nem árt. ■■ Joint Venture Association Hungary ■■ Project Management Institute ■■ Hungarian Electromobility ■■ Association of Japanese ■■ ICT Association of Hungary (IVSZ) Association Enterprises in Hungary

In the 2020 financial year, we worked together with the following non-profit organisations:

10 Million Trees Foundation Female entrepreneurs EffekTeam Volunteering Hungary – HAT Foundation Centre of Social Innovation Hegyvidéki Ízlelő (ÖKA) Homoludens.hu Association Pető Institute of Conductive I am a member of Volunteering Hungary’s working group of corporate professionals who Hősök Tere Development develop methodological guidelines for developing and managing corporate volunteer Kockacsoki Nonprofit Kft. Sportos Cukorbetegek programs. It is important and inspiring for me to be involved in this project because with my Konnekt (Sports and Diabetes experience I can help a good cause and an organisation that would probably not be able to KORE Association) afford commercially available consultancy services. I am grateful that PwC is creating an opportunity KÖZ-Pont Youth Suhanj Foundation for this kind of work as well.” Organisation Bernadett Nádasy, consultant

41 I Sustainability Report – 1 July 2019 – 30 June 2020 Awards and recognition

For the 16th consecutive year

This list is an annual ranking of the 100 best companies with outstanding workplace cultures. Rankings are based on survey responses from more than 4.1 million U.S. employees, with respondents rating their workplace culture on more than 60 elements.

42 I Sustainability Report – 1 July 2019 – 30 June 2020 Responsible operation

Environmental and operational awareness

Modern, environmentally friendly offices

PwC Hungary’s office is housed in the Eiffel Palace in Budapest. The Eiffel Palace is the first office development project in Central and Eastern Europe to meet the strict requirements of both the BREEAM and LEED environmental standards with excellent results.

Green features of the building:

■■ energy efficiency class “A”; ■■ rainwater utilisation system with ■■ the use of faucet aerators to ■■ the roof accommodates 120 solar a storage capacity of 200 m3; conserve water; panels; sufficient to produce rainwater is used for flushing toilets ■■ energy-efficient cooling/heating 50,000 kWh/a of electricity; the and watering plants; system; electricity produced by solar panels ■■ external facade lighting with an ■■ automatic lighting control using is used in breakout areas; LED source and BMS control; presence and motion detectors; ■■ the building is heated and cooled ■■ elevators with high energy ■■ local separated waste collection using an air-source heat pump efficiency; (in both the implementation and system; ■■ more than 60 m2 of planted “green operational phases);

■■ the CO2 emission of the building wall” in the lobby, watered with ■■ environmentally responsible waste is reduced by more than 30% rainwater; management; through the use of local low and ■■ 100 bicycle stands and eight ■■ extensive green roof on multiple zero carbon technology (VRV showers available to our levels; system, solar energy water heating, employees; ■■ chargers for electric and hybrid PV system); ■■ it should be easily accessible by cars; ■■ high-efficiency lighting systems are public transport; ■■ waterless car wash using little or controlled by sunlight and motion ■■ the proximity of bicycle routes, no water sensors; providing an alternative means of transport; ■■ photovoltaic panels providing electricity for electric and hybrid vehicle chargers;

43 I Sustainability Report – 1 July 2019 – 30 June 2020 Climate protection and reducing our environmental footprint Headcount Office space are of strategic importance in PwC’s global network. In order 2020 2019 2 to drive sustainable growth, we have undertaken to implement 8,325 m short- and long-term environmental goals, and we align our operation with these goals. 835 816

Our most important achievements in the past financial year in +2% terms of reducing our environmental impact:

Electronic waste Power consumption Communal waste

FY 2020 FY 2020 FY 2020 0.634 t 737,844 kWh 1,040 m3 FY 2019 FY 2019 1.24 m³/person 0.42 t 800,000 kWh FY 2019 +150% -8% 1,144 m3 /1.4 m3/person -10%

Separated waste Sheets of paper used

Plastic waste Paper waste FY 2020 FY 2020 FY 2020 53 m3 208 m3 1,048,355 sheets 0.063 m3/ 0.24 m3/ 1255.5 sheets/person person person FY 2019 FY 2019 FY 2019 57 m3/0.069 m3/person 343 m3/0.42 m3/person 1,590,291/1948.9/person -8.7% -42% -35.6%

44 I Sustainability Report – 1 July 2019 – 30 June 2020 Electric cars Road travel in numbers

Our firm owns two Nissan Leaf all-electric cars, Based on the mileage records submitted, we present below which demonstrate our commitment to environmental the usage data for vehicles belonging to the fleet leased by consciousness and sustainability. We use these cars for PwC. courier services. Where possible, our staff also use them instead of taxis or rented cars to visit clients in Budapest, During the reporting period, there were 17 more cars reducing our environmental impact on the city. The cars are running than in the previous financial year: a total of 99 very popular among our colleagues. cars, plus two all-electric cars that were not yet in the fleet in 2019.

PwC – MOL Limo cooperation

To promote sustainability, in addition to taxis, MOL Limo is also available for business use. Car sharing is Gasoline-powered (62) Diesel-powered (33) gaining ground in public transport, and we encourage our FY 2020 FY 2020 employees to take advantage of this opportunity, which is open to all. 766,816 km 499,719 km FY 2019 FY 2019 400,000 km 600,000 km

Hybrid (4) Electric (2)

FY 2020 FY 2020 60,704 km 22,213 km FY 2019 22,279 km

Total

FY 2020 1,349,452 km FY 2019 1,022,279 km

45 I Sustainability Report – 1 July 2019 – 30 June 2020 Air travel in numbers

Short haul (less than 460 km) 9447 km

FY 2019: 33,519 km

Medium haul (460 km to 3,700 km) 796,290 km

FY 2019: 1,031,311 km

Overseas (more than 3700 km) 1,210,647 km

FY 2019: 1,051,505 km

Total Short-haul flights Number of flights FY 2020 724 flights -72% -29%

2,016,384 km Medium-haul flights Kilometres flown, almost FY 2019 -23% -5% 1,019 flights; 2,116,335 km

46 I Sustainability Report – 1 July 2019 – 30 June 2020 How can we become greener? GHG offset More about PwC’s carbon offset projects In this extraordinary year, declining office use and travel We are committed to minimising the impact of our carbon restrictions have significantly impacted some of our emissions focusing on areas of our footprint that are most environmental metrics: power consumption, paper usage material to our business. While professional services firms and air travel decreased. At the same time, we saw an do not have the footprint of many other industries, we use increase in other metrics, which added to our environmental significant power in our offices and data centres, and travel footprint: to deliver on our client engagements.

■■ The increase in electronic waste was partly due to the Air travel is an essential part of how we perform our client- replacement of corporate mobile phones (we provided facing work, but it is also one of the largest sources of iPhone 11 smartphones to all our employees at the end our carbon emissions. To help reduce the impact of our of 2019). travel, our firms are adopting new meeting technologies Green office task force ■■ The use of company cars increased significantly, which and raising awareness amongst our people of alternative is partly due to increased staff numbers and a growing ways to travel. From 2019, we are investing in a range of The members of our green office task force meet monthly fleet, and partly to the fact that our employees preferred voluntary carbon offset projects to mitigate the impact of to discuss ideas on how to be more environmentally using cars to other modes of travel. our air travel emissions. conscious in our everyday life, both at home and at ■■ Although flights have decreased, this is because air work, and how we can shape our colleagues’ approach. travel practically ceased in the last four months of Of course, we are aware that the decrease in our Through our internal communication channels, we draw our our financial year; under normal conditions, we would environmental footprint is partly due to the travel restrictions colleagues’ attention to green initiatives and publish articles presumably have seen a significant increase. caused by the coronavirus pandemic and to the prevalence on the topic. Our event organisation team pays special of remote work. However, many new practices have attention to minimizing unnecessary waste at our events, become part of our corporate culture: we are constantly and we favour suppliers who operate in a sustainable optimising our work processes and developing our services manner. so that they involve significantly less travel, favouring a digital workflow over a paper-based workflow. Bermuda Shorts Days

Our goal remains the same: to reduce our carbon footprint, Summer Fridays are Bermuda Shorts Days at PwC Hungary, in line with our global commitment, and to offset 100% of which means that our colleagues may dress more casually, our air travel emissions by investing in PwC’s global carbon as appropriate for the weather. What does this mean in offset initiatives and projects. practice? There is no strict dress code for summer Fridays; our colleagues are free to dress as their day requires. In addition, on the last working day of the week, a uniform temperature of 25°C is set in our office. With this initiative, we want to encourage other companies to take simple but effective steps to combat climate change.

47 I Sustainability Report – 1 July 2019 – 30 June 2020 PwC in Hungary

In Hungary, in our offices in Budapest and Győr, 835 employees assist our clients in three main service areas: assurance, tax and legal, and advisory services, and in many other specialties. We have grown to become a leading audit and business advisory firm because we have been gathering experience ever since we were established in 1854. We use this experience and combine it with our local expertise. The source of this experience and expertise is our people, on whom our present and future depends.

Economic indicators

23,161,700,000 Net sales revenue (HUF) 19,247,740,000

19,842,350,000 Balance sheet total (HUF) 13,992,940,000

16,383,205,358 Operating expenses (HUF) 15,978,174,000

Employees’ wages and 9,218,660,150 benefits (HUF) 9,145,515,000

9,159,853,380 Taxes (HUF) 10,612,894,000

2020

2019

2020 2019 Headcount 835 816

48 I Sustainability Report – 1 July 2019 – 30 June 2020 Our services

Assurance services Tax and Legal Services Advisory

Audit services Tax Controversy & Dispute Resolution Legal services Management consulting services ■■ Audit or review of standalone or consolidated Tax policy ■■ Company law, company conversions ■■ Strategy & Operation financial statements prepared in accordance State aid and tax incentives ■■ Acquisitions ■■ CRM & Customer Technologies with HU GAAP (Generally Accepted ■■ Disputes and litigation ■■ Project, program and investment Accounting Principles), US GAAP, IFRS Tax reporting & strategy ■■ Real estate management (International Financial Reporting Standards), ■■ Financing and banking transactions ■■ Innovation management and start-ups ■■ Consulting on tax and accounting technology (or other) and in accordance with ISA ■■ Data protection law ■■ Tax strategy & operation (International Standards on Auditing) or other ■■ Employment law Financial transaction advisory ■■ Accounting review GAAS ■■ Competition law and consumer protection ■■ Accounting compliance services ■■ Valuation & financial advisory ■■ Audit or review of group reporting packages ■■ Pharma and health ■■ Payroll accounting ■■ Transaction services ■■ Interim review reporting ■■ Intellectual property and IT law ■■ Payroll review ■■ Business recovery services ■■ Special purpose audit reports ■■ Energy and public utilities ■ Tax returns and deferred tax ■■ Infrastructure and transport consulting ■■ Audit support ■ ■■ Staff leasing ■■ M&A and financing advisory services ■■ Company Gateway (“Cégkapu”) services ■■ Real estate consulting Risk Assurance Services ■■ Fraud prevention and detection ■■ Governance, Risk, Compliance Indirect taxes ■ Cyber Technical expert services ■ ■■ Value added tax ■ Data-driven audit and process development ■ ■■ Smart Tax – automated tax solutions ■■ CIO consulting ■ SAP solutions and services ■ ■■ Customs and international trade ■■ IT implementation and systems integration ■■ Excise duty, environmental product fee, and ■■ IT project/portfolio management Accounting Advisory and PwC’s Academy public health product tax ■■ Digital architecture ■■ Data Analytics - Enterprise Analytics & Data • Accounting advisory services ■■ E-invoicing and e-archiving Solutions • Treasury services ■■ Digital business • Future of Finance Direct taxes ■■ Enterprise Business Applications • Advisory services for the financial sector ■■ Mergers and acquisitions (M&A) • Actuarial services ■■ General corporate tax consulting & • PwC’s Academy restructuring ■■ R&D-related tax allowances ■■ Sports consulting ■■ development tax incentive ■■ Tax incentive for investment projects related to energy efficiency

IFRS direct taxation matters Transfer pricing Audit of Tax People and Organisation

49 I Sustainability Report – 1 July 2019 – 30 June 2020 Legal structure and ownership of PricewaterhouseCoopers Auditing Ltd. (PwC Kft.)

PwC Ltd. is a limited liability company. The PwC Ltd. cooperates with other Central and shares and voting rights of the company Eastern European member firms to provide are held by: services to local and mutual international clients operating in our region. This ■■ PricewaterhouseCoopers CEE Firm cooperation is organised through a regional Services s.r.o. (86.75% ownership, management team which, in addition to registered in Slovakia), ensuring the adherence of these regional firms to the policies and procedures of PwC ■■ PricewaterhouseCoopers Spolka z International, enables resource sharing, the o.o. (11.75 % ownership, registered in enforcement of risk management policies and Poland), and quality standards. ■■ PricewaterhouseCoopers Eastern Europe BV (1.5% ownership, registered Each national member firm also has its in the Netherlands). own management structure in place, in accordance with relevant legal and operational requirements. This legal structure Such entities are ultimately owned by and network arrangement gives each the partners of PricewaterhouseCoopers member firm the flexibility and autonomy to member firms. respond quickly and effectively to conditions in its local market. It also reflects the fact that PwC Ltd. is a member of regulatory authorities in some countries grant PricewaterhouseCoopers International the right to practise as auditors to nationally Limited. based firms in which locally qualified professional auditors (or in the European Union a combination of auditors and or EU audit firms) have at least a majority ownership and control.

50 I Sustainability Report – 1 July 2019 – 30 June 2020 PwC’s history

1849 Samuel Lowell Price sets up business in London. 1854

1865 Price, Holyland and Waterhouse 1865 join forces in partnership. 1898 1874 William Cooper establishes his own practice in London, which seven years later becomes Robert H. Montgomery, The company’s name changes Cooper Brothers. William M. Lybrand, Adam 1898 to Price, Waterhouse & Co. A. Ross Jr. and his brother T. Edward Ross form Lybrand, Ross Brothers and Montgomery. 1957

Lybrand, Ross Bros & Montgomery, Cooper Brothers 1957 & Co, McDonald and Currie and Co. (Canada) merge to form Coopers & Lybrand.

1982 Price Waterhouse World Firm is formed.

1989 Price Waterhouse opens its first office in Hungary. Coopers and Lybrand Hungary is formed.

1998 Worldwide merger of Price Waterhouse and Coopers & Lybrand creates PricewaterhouseCoopers.

2010 As part of our rebranding efforts, we changed our name from PricewaterhouseCoopers to PwC.

PwC Magyarország opens its first regional office in Győr. 2011

2012 The CEO Survey is launched in Hungary.

2014 PwC Magyarország moves into the Eiffel Palace.

2017 The number of staff exceeds 800.

2018 Tamás Lőcsei takes over as PwC Magyarország’s CEO. His predecessor, Nick Kós, becomes CEO for the CEE region from 1 July.

51 I Sustainability Report – 1 July 2019 – 30 June 2020 Governance PwC Hungary’s organisational structure between 1 July 2019 and 30 June 2020

Within the Central and Eastern European grouping of PwC member firms, which includes 29 national territories, a matrix system of management is operated. Each partner votes every four years in an election that chooses a PwC CEE Chief Executive, who in turn appoints a Management Tamás Lőcsei Board, including representatives from geographical and business lines and Operational Leaders. This Management Country Managing Partner Board is responsible for setting broad business objectives and ensuring compliance with PwC International policies.

Internal Across geographical lines the policy and business László Deák Ádám Osztovits Árpád Balázs Firm objectives of each principal business line (Assurance, Tax and Legal Services Advisory Assurance services Tax & Legal and Advisory) are set by the business line Services management team. Legal services Management Core assurance Oversight of the Regional Management Board on behalf of consulting services People & services the partners is carried out by an elected regional Partners Organisation Value-added Council, which approves key policies and decisions which Financial assurance services affect partners and the firm. Indirect taxes transaction Finance advisory Tax reporting & Human Capital PwC Kft. is managed by the managing directors appointed strategy Technology Capital Markets and Accounting Advisory Infrastructure & by the shareholders. The managing directors Direct taxes Consulting Services (CMAAS) Procurement as of 30 June 2020 are: Transfer pricing Treasury IT PwC’s Academy Dr. Tamás Lőcsei and Language Services Risk Assurance Services Árpád Balázs ACCA, registered statutory auditor. (RAS) Marketing, Actuarial services Communications Éva Barsi, registered statutory auditor. and Business Development A three-member Supervisory Board was also elected, consisting of the following members: Dr. Zoltán Várszegi, Paul Grocott and Nick Kós.

The Company’s supreme body is the Shareholders’ Meeting, which is convened at least once annually.

52 I Sustainability Report – 1 July 2019 – 30 June 2020 PwC’s global network PricewaterhouseCoopers International Limited The governance bodies of PwCIL are:

PwC is the brand under which the member firms of Firms in the PwC network are members in, or have other ■■ Global Board, which is responsible for the governance PricewaterhouseCoopers International Limited (PwCIL) connections to, PricewaterhouseCoopers International of PwCIL, the oversight of the Network Leadership Team operate and provide professional services. Together, these Limited (PwCIL), a UK private company limited by and the approval of Network Standards. The Board does firms form the PwC network. ‘PwC’ is often used to refer guarantee. PwCIL does not practice accountancy or not have an external role. Board members are elected either to individual firms within the PwC network or to provide services to clients. Rather its purpose is to act by partners from all PwC firms around the world every several or all of them collectively. as a coordinating entity for member firms in the PwC four years. network, focusing on key areas such as strategy, brand, ■■ Network Leadership Team, which is responsible for In many parts of the world, accounting firms are required by risk and quality. PwCIL works to develop and implement setting the overall strategy for the PwC network and the law to be locally owned and independent. The PwC network policies and initiatives to create a common and coordinated is not a global partnership, a single firm, or a multinational approach for PwC firms. Member firms of PwCIL can standards to which the PwC firms agree to adhere. use the PwC name and draw on the resources and corporation. The PwC network consists of firms which are ■■ Strategy Council, which is made up of the leaders separate legal entities. methodologies of the PwC network. In addition, member of the largest PwC firms and regions of the network, firms may draw upon the resources of other member firms agrees on the strategic direction of the network and and/or secure the provision of professional services by facilitates alignment for the execution of strategy. PricewaterhouseCoopers other member firms and/or other entities. In return, member firms are bound to abide by certain common policies and to ■■ Global Leadership Team is appointed by and reports to International Limited (“PwCIL”) maintain the standards of the PwC network as put forward the Network Leadership Team and the Chairman of the by PwCIL. PwC network. Its members are responsible for leading is one of the world’s largest teams drawn from network firms to coordinate activities The PwC network is not one international partnership. A across all areas of our business. networks of professional services member firm cannot act as agent of PwCIL or any other member firm, cannot obligate PwCIL or any other member firms. PwC’s 284,000 employees The CEO of PwC CEE is Nick Kós, who is a member of firm, and is liable only for its own acts or omissions and not the Strategy Council and maintains relationships with the those of PwCIL or any other member firm. Similarly, PwCIL help our clients and stakeholders Network Leadership Team. cannot act as an agent of any member firm, cannot obligate in 1008 offices in 155 countries any member firm, and is liable only for its own acts or omissions. PwCIL has no right or ability to control member with industry-specific audit, tax, firm’s exercise of professional judgement. legal and advisory services.

53 I Sustainability Report – 1 July 2019 – 30 June 2020 Quality and risk management

Delivering service of the highest quality is core to our The objective of ISQC 1 is for the firm to establish and We and the other PwC member firms are committed to purpose and our strategy, the focus of which is to maintain a system of quality control to provide it with delivering quality services around the world. To maximise strengthen trust and transparency in our clients, in the reasonable assurance that: consistency in the Network, we use a formal curriculum capital markets and wider society. developed at the Network level. ■■ the firm and its personnel comply with professional To help PwC Hungary put this strategy into effect, the standards and regulatory and legal requirements; and This formal learning is delivered using a blend of delivery PwC network has established a framework for quality ■■ reports issued by the firm or engagement partners are approaches, which include remote access, classroom management which integrates quality management into learning and on-the-job support. The curriculum allows appropriate in the circumstances. business processes and the firm-wide risk management us to select when we will deliver different portions of the process. training based on local needs. Our detailed quality control procedures are set out in our PwC Audit Guide and in PwC’s Network Risk Management The framework introduces an overall quality objective PwC prescribes mandatory e-learning courses aimed at policies and guidance. The policies and procedures are primarily for the Assurance practice focused on having the educating staff members about risk management, quality embedded as part of the firm’s day-to-day activities. necessary capabilities in our organisation and deploying our and compliance issues. people to consistently use our methodologies, processes Our QMS is based on the six elements of quality control set and technology in the delivery of services in an effective These are as follows: out in ISQC 1, which are: and efficient manner to fulfil the valid expectations of our clients and other stakeholders. ■ Mandatory Risk & Quality 2019 training – online course Leadership responsibilities for quality within the ■ to be completed at the start of each financial year firm Our quality management system for our Assurance practice ■■ CEE Compliance Curriculum – Risk Management is based on International Standard on Quality Control 1 – Package, which includes Combatting Corruption and “Quality control for firms that perform audits and reviews Ethical requirements Money Laundering, and Living the Code: Insider trading of financial statements, and other assurance and related and Economic sanctions training for new joiners – this services engagements” (ISQC 1) issued by the International course must be completed by all new joiners by the Auditing and Assurance Standards Board (IAASB) and the Acceptance and continuance of client relationships specified deadline. standards/guidelines issued by the Hungarian Chamber and specific engagements of Auditors. ISQC 1 applies to firms that perform audits of financial statements, report in connection with investment Human resources circulars and provide other assurance services where they relate to activities that are reported in the public domain and are therefore in the public interest. Engagement performance

Monitoring

54 I Sustainability Report – 1 July 2019 – 30 June 2020 Human rights

No human rights violations were reported during the period concerned. We believe it’s our responsibility to respect and uphold the human rights of our people and any other individuals we are in contact with. We seek to integrate human rights into our existing business practices, in accordance with our human rights policy. PwC’s Global Human Rights Statement is available on our website.

55 I Sustainability Report – 1 July 2019 – 30 June 2020 Code of Conduct

We take pride in the fact that our services add value by helping to improve transparency, However, we also acknowledge that these standards, laws, and policies do not govern all trust and consistency of business processes. In order to succeed, we must grow and types of behaviour. As a result, we also have a Code of conduct which is applicable and develop, both as individuals and business. Our core values of Excellence, Teamwork and issued to all PwC people and firms. This Code is based on our values and takes them Leadership help us to achieve this growth. We conduct our business within the framework to the next level – demonstrating our values in action. The Code defines how we should of applicable professional standards, laws, and regulations together with PwC policies behave and conduct business in a wide range of settings and situations. It also contains a and standards. This objective incorporates, inter alia, full compliance with the IESBA “framework for ethical decision making’’ to assist partners and staff in deciding on the right (International Ethics Standards Board for Accountants) Code of Ethics for Professional course of action in addressing ethical dilemmas they can come across. Partners and staff Accountants. are expected to not only live by the Code values in their careers with PwC but to also help others at PwC do the same.

cies • St Poli anda CEE has a fully integrated Ethics & Business Conduct network. Supervision over ethical • rd s s ic • matters in CEE is carried out by the regional Ethics and Business Conduct Leader. Each th P E w C country has a local Ethics and Business Conduct Team responsible for promoting ethics • P r s o locally. This includes, but is not limited to, communication and training to local country w fe a s L s i partners and staff. Each PwC office has access to the detailed supplementary guidance to o • n

P a our Code of conduct. These policies include guidance on such matters as the receipt of

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Living our Purpose and Values

The PwC culture thrives supported by a framework of internal and external expectations and requirements. These help guide our behaviours and build trust: ■■ in our business model ■■ in each other ■■ in our communities ■■ in how we use information

56 I Sustainability Report – 1 July 2019 – 30 June 2020 CEE has a region-wide tool accessible to all partners The CEE Complaints and Allegations policy sets the and staff to enable the sending of anonymous queries to protocols for investigating the issues reported. All a selected Ethics & Business Conduct team. Individuals amendments needed to the firm’s systems or policies, from outside of PwC, including our clients’ personnel, identified during the course of an ethical investigation, can submit a query, in an anonymous manner, by using are addressed. The IESBA Code of Ethics and PwC a global PwC communications tool available from http:// standards are supplemented with the Ethical Rules of the www.pwc.com. When potential non-compliance with our Hungarian Chamber of Auditors. To find out more about Code of conduct is reported or otherwise suspected, PwC Hungary’s global quality management system, ethical steps are taken to investigate, and where appropriate, requirements, independence policy and the effectiveness of remedy the situation. Partners and staff are encouraged to our internal quality control system, please refer to our 2020 report and express their concerns and must do so fairly, Transparency Report. Speak Up honestly and respectfully. PwC is committed to protecting individuals against retaliation. Partners and staff at PwC are The PwC Code of Conduct is available here. At PwC, we believe in creating an inclusive workplace responsible for addressing issues that are brought to their where people feel able to be themselves in a safe attention. PwC Hungary’s Ethics Leader is Péter Biczó, Partner. environment that helps foster an open culture where everyone feels comfortable bringing their ideas – and their challenges – to the table. These values are Build trust with each other central to who we are and how we operate, and this helps us deliver a quality service to our clients.

Our confidential whistle-blowing helpline and C Profes w sio website – “Speak Up” – are available to any partner e P n At each level and dimension of the PwC Professional, h a expectations on ethical behaviour are defined. T l or member of staff who observes inappropriate ips Bu sh a s business conduct or unethical behaviour that cannot n cu in io m e t s be resolved locally, or where the normal consultation e s a n l processes are not appropriate. e

R Whole leadership The helpline or website can also be used if you just

G l a s l a have questions or want advice about speaking up and c e o c i u b i t reporting concerns. m a n li e l ch i n Te ab cap The helpline number is 020 7212 5233, and the website can be accessed here. The most innovative solutions come from working together with colleagues and clients. Effective collaboration enables innovation.

Living our Purpose and Values—PwC’s Code of Conduct 11 57 I Sustainability Report – 1 July 2019 – 30 June 2020 RADAR

We are purpose led and values driven, and our purpose and values are our guiding principles in deciding the right thing to do. Addressing and resolving ethical dilemmas is complex, and the Code cannot address all questions or situations. The Code is one of many tools we have as professionals to guide our behaviour. It is not meant to be a rule book. The Code is underpinned by the PwC Purpose and values. It is supported and supplemented by network standards, network and local policies and guidance, all of which are available on relevant sites throughout the network.

The RADAR decision making framework is here to help our people think and to build their RADAR: A framework skillsfor in decidinganalysing ethical the dilemmas, and, in doing so, make good decisions. right thing to do

Recognising the event

Reporting and Assessing communicating the situation RADAR

Agreeing the Deciding way forward what to do

Living ourPwC’s Purpose and ThirdValues—PwC’s Party Code of Conduct Code of Conduct 21

PwC’s Third Party Code of Conduct explains the minimum standards of integrity and business conduct PwC expects of the third parties with which it does business. PwC expects third parties to require the same levels of integrity and business conduct from their personnel and anyone outside their organisation engaged to provide services for or with PwC.

58 I Sustainability Report – 1 July 2019 – 30 June 2020 GRI Content Index

GRI (Global Reporting Initiative) is an international organisation the purpose of which is to provide a standard framework of guidelines and indicators for preparing sustainability reports, thus ensuring comparability and promoting transparency among companies. The following table shows the information included in the report attached to specific GRI indicators. You can read more about the guidelines and the indicators on the following website: https://www.globalreporting.org/standards/

Reference in the Page Reference in the Page Number Disclosure Comments Number Disclosure Comments report number report number

102-14 Statement from senior decision-maker CEO’s letter 3 Entities included in the consolidated 102-45 About the report 5 102-2 Activities, brands, products, and services PwC in Hungary 49 financial statements Defining report content and topic 102-3 Location of headquarters PwC in Hungary 48 102-46 About the report 5 boundaries 102-4 Location of operations PwC in Hungary 48 102-47 List of material topics About the report 6 102-5 Ownership and legal form PwC in Hungary 50 103-1- 102-6 Markets served PwC in Hungary 53 Evaluation of the management approach Our strategy 22-25 2-3 102-7 Scale of the organisation PwC in Hungary 48 102-48 Restatements of information N/A Information on employees and other 102-8 Our people 12 There was no change workers 102-49 Changes in reporting in PwC’s Hungary’s In Hungary, PwC reporting. 102-9 Supply chain Our stakeholders 41 engaged the services of 609 suppliers in FY 2020. 102-40 List of stakeholder groups Our stakeholders 34 https://www.pwc.com/hu/ 102-43 Approach to stakeholder engagement Our stakeholders 34 102-15 Key impacts, risks, and opportunities 11 hu/covid-19.html 102-44 Key topics and concerns raised About the report 6 102-1 Name of the organisation PwC in Hungary 50 102-50 Reporting period About the report 6 Financial implications and other risks and 201-2 N/A N/A opportunities due to climate change 102-51 Date of most recent report About the report 6 102-42 Identifying and selecting stakeholders Our stakeholders 34 102-52 Reporting cycle About the report 6 102-19 Delegating authority PwC in Hungary 52 Contact point for questions regarding Review of economic, environmental and 102-53 About the report 6 102-31 Our strategy 23 the report social topics Claims of reporting in accordance with This information is 102-54 About the report 6 Percentage increase in annual total the GRI Standards 102-39 confidential according to compensation ratio PwC’s HR policy. 102-55 GRI content index 59 Values, principles, standards, and norms 102-56 External assurance About the report 5 102-16 Our values 10 of behaviour 102-18 Governance structure PwC in Hungary 52 Mechanisms for advice and concerns PwC Transparency 102-17 Human rights 56 about ethics Report 2020 Executive-level responsibility for According to a 102-20 economic, environmental and social PwC in Hungary 52 decision by PwC’s topics Consulting stakeholders on economic, 102-41 Collective bargaining agreements N/A CEO, information on 102-21 Our stakeholders 34 collective agreements is environmental and social topics confidential. Composition of the highest governance 102-22 PwC in Hungary 52 PwC Transparency body and its committees 102-11 Precautionary principle or approach Report 2020 102-23 Chair of the highest governance body PwC in Hungary 52 102-12 External initiatives PwC Transparency 102-25 Conflicts of interest 102-13 Membership of associations Our stakeholders 41 Report 2020

59 I Sustainability Report – 1 July 2019 – 30 June 2020 Reference in the Page Reference in the Page Number Disclosure Comments Number Disclosure Comments report number report number

Role of highest governance body in Staff on parental leave: 23 102-26 PwC in Hungary 52 setting purpose, values, and strategy 401-3 Parental leave Staff returning from Collective knowledge of highest parental leave: 5 102-27 PwC in Hungary 50 governance body Minimum notice periods regarding The notice period is 30 402-1 Evaluating the highest governance body’s PwC Transparency operational changes working days. 102-28 performance Report 2020 Occupational health and safety 403-1 N/A Confidential information. Identifying and managing economic, management system 102-29 Our values 11 CEO, FoF environmental and social impacts “There were no accidents Effectiveness of risk management Quality and risk at work, related absences 102-30 54 Hazard identification, risk assessment, processes management 403-2 or lost working time and incident investigation Highest governance body’s role in during the reporting 102-32 Our strategy 22 sustainability reporting period.” PwC Transparency Responsible 102-33 Communicating critical concerns 301-1 Materials used by weight or volume 43-47 Report 2020 operation Nature and total number of critical PwC Transparency Responsible 102-34 301-2 Recycled input materials used concerns Report 2020 operation This information is Energy consumption within the Responsible 302-1 102-35 Remuneration policies confidential according to organisation operation PwC’s HR policy. Responsible 302-3 Energy intensity This information is operation 102-36 Process for determining remuneration confidential according to Responsible PwC’s HR policy. 302-4 Reduction of energy consumption operation This information is Stakeholders’ involvement in 102-37 confidential according to 305-1- Responsible remuneration Emissions PwC’s HR policy. 2-3 operation This information is 403-3 Occupational health services Our people 14 102-38 Annual total compensation ratio confidential according to Worker participation, consultation, and PwC’s HR policy. 403-4 communication on occupational health PwC Care4Life Direct economic value generated and and safety 201-1 About PwC 7 distributed Average hours of training per year per Defined benefit plan obligations and other 404-1 Our people 17 201-3 Our people 14 employee retirement plans Financial assistance received from 201-4 PwC Hungary does government not regularly provide Programs for upgrading employee skills Ratios of standard entry level wage by 404-2 (retraining) counselling 202-1 N/A and transition assistance programs gender compared to local minimum wage to retiring employees or Proportion of senior management hired those changing jobs. 202-2 13 from the local community Infrastructure investments and services PwC assesses the 203-1 performance of its supported Percentage of employees receiving employees each year. Our key performance 404-3 regular performance and career 203-2 Significant indirect economic impacts 4 Performance was indicators development reviews assessed through PwC 204-1 Proportion of spending on local suppliers Our stakeholders 41 Workday in FY 2020. New employee hires and employee Diversity of governance bodies and 401-1 Our people 13 405-1 Diversity 20 turnover employees Benefits provided to full-time employees Full-time and part-time We review the principle 401-2 that are not provided to temporary or Our people 14 employees are entitled to Ratio of basic salary and remuneration of of equal pay annually 405-2 part-time employees the same benefits. women to men and make adjustments if necessary.

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New suppliers that were screened using There was no such 414-1 Our stakeholders 41 Confirmed incidents of corruption and social criteria 205-3 incident during the period actions taken There were no such under review. Negative social impacts in the supply incidents at our company Legal actions for anti-competitive There was no such 414-2 chain and actions taken during the period under 206-1 behaviour, anti-trust and monopoly incident during the period review. practices under review. Significant investment agreements and https://www.pwc.com/gx/ Assessment of the health and safety contracts that include human rights en/about-pwc/ 416-1 impacts of product and service N/A 412-3 clauses or that underwent human rights pwc-human-rights- categories screening statement.pdf Incidents of non-compliance concerning There were no such Employee training on human rights 416-2 the health and safety impacts of products 412-2 Human rights 55 incidents. policies or procedures and services There were no Requirements for product and service PwC Transparency 417-1 reported incidents of information and labelling Report 2020 Incidents of discrimination and corrective 406-1 discrimination at PwC actions taken Number of incidents Hungary during the Incidents of non-compliance concerning of non-compliance reporting period. 417-2 product and service information and concerning product and Operations and suppliers at significant labelling service information and PwC Transparency 409-1 risk for incidents of forced or compulsory labelling: 0. Report 2020 labour Nominating and selecting the highest 102-24 PwC in Hungary 52 Operations and suppliers at significant PwC Transparency governance body 408-1 risk for incidents of child labour Report 2020 There has been no Significant changes to the organisation Security personnel trained in human PwC Transparency 102-10 Our stakeholders significant change 410-1 and its supply chain rights policies or procedures Report 2020 amongst PwC’s suppliers. No human rights Incidents of non-compliance concerning There were no such 417-3 Incidents of violations involving rights of violations were reported marketing communications incidents. 411-1 indigenous peoples during the period Substantiated complaints concerning There was no such concerned. 418-1 breaches of customer privacy and losses N/A incident during the period Operations that have been subject of customer data under review. PwC fully complies with 412-1 to human rights reviews or impact this commitment. assessments 415-1 Political contributions N/A PwC Hungary did not identify any incidents Non-compliance with laws and of non-compliance that 419-1 regulations in the social and economic would be contrary to area PwC’s statutes or its social media policy during this period. Operations with local community 413-1 engagement, impact assessments, and Our strategy 27-32 development programs Operations with significant actual and PwC is not aware of any 413-2 potential negative impacts on local N/A negative effects. communities There were no such local Operations assessed for risks related to 205-1 N/A incidents during the corruption period under review. Communication and training about anti- Quality and risk 205-2 54-58 corruption policies and procedures management

61 I Sustainability Report – 1 July 2019 – 30 June 2020 Imprint

Special thanks to members of the “Reporting working group” and the “Corporate responsibility working group” of PwC Hungary for their contribution to this report.

Contents Photo credits Cecília Szőke PwC Photo Library, Gábor Bodó, István Juhász Katalin Simon PwC Hungary

Published by Contact Borbála Palotai PwC Hungary Senior Manager 1055 Budapest, Bajcsy-Zsilinszky út 78. Marketing, Communications Phone: +36 1 461 9444 and Business Development www.pwc.com/hu PwC Hungary Email: [email protected]

Balázs Mészáros Partner PwC Hungary

62 I Sustainability Report – 1 July 2019 – 30 June 2020