Message from our Managing Partner

It is a privilege for me to write the first introduction to our Annual Review as newly elected Managing Partner of PwC Luxembourg as from 1 July, 2023. I am proud to say that we managed a very smooth transition from the previous to the new leadership and minimised any loss of momentum from a leadership change. Also, as you can read in this Annual Review, we managed to strengthen our Governance in ensuring a robust diversity in our leadership bodies.

I would first like to start with a very short retrospective on the year we just concluded on 30 June, 2023.

FY23 has been a very busy, but also a very successful year for PwC Luxembourg. This is despite a context, which has been characterised by the return of a long-forgotten phenomenon: inflation - with a resulting very sharp tightening of monetary policy across much of the developed world.

We reached a record turnover of €635m which is an increase of 17% from FY22. This growth has been fuelled by all our businesses and all our industries, something we are particularly proud of. However, it should be noted that a significant portion of that turnover increase is linked to price adjustments we needed to take in order to absorb significant cost increases, both on the side of the remuneration of our People and on the side of our other overheads (rent, IT costs, etc.). Especially regarding our People, we have made a significant investment in the last year in terms of alignment of our salary grids and our bonus pools in order to also help them cope with the high inflation environment and in order to be competitive on the market.

For us at PwC Luxembourg, financial success is an outcome, and not a means in itself. 

We believe that the following have contributed to that outcome :

• The market priorities we choose, and to which extent they are aligned to our purpose and the needs of our clients; on those priorities, I would specifically like to highlight Managed Services, Sustainability Services and Technological Alliances,
• The impact we make on our Clients and Communities,
• The level of investment we make in order to transform our delivery models, develop new services and embrace relevant technology,
• How we care for our People over and above of a competitive compensation (in terms of flexibility, well-being as well as learning and development), and
• Our walking-the-talk in how we manage our ecological footprint and contribute to the overall decarbonisation effort.

This Annual Review is fully aligned with those success factors and is structured according to the four WEF-IBC Pillars: Governance, Planet, People and Prosperity. In FY23, for the first time, we directly report on the core metrics of those pillars in a manner true to our values by saying things as they are and factually reporting both on the progress we made but also on the areas where we still need to improve.

As one of the largest employers in the country and through our daily contact with thousands of clients, we are also a barometer of the economy and of business. In that context, we think it is our duty to highlight the most pressing concerns and challenges that we can see. 

These are the “Top 3” I would like to highlight: 

• Competitiveness of Luxembourg and – specifically – the Financial Centre,
• Attractivity of talent, and
• Social cohesion, and especially the disconnect between the social composition of our legislative bodies and the private sector.

In this context, I was happy to see that in the National Elections of 8 October, the voters gave their confidence to political parties and politicians who understand the importance of growth and competitiveness for a small open economy like Luxembourg. We remain fully neutral from a political point of view, but we have always seen our role in bringing the relevant data and international client input towards the Government to take informed decisions around the growth trajectory and focus areas of our country. Specifically with regard to the importance of the Financial Centre and the decarbonisation and green transition challenge, we are convinced that Luxembourg must play a leading role in Europe and worldwide!

When looking at the first three months of our new fiscal year, we can see mounting uncertainty, mainly due to the monetary environment, which has tightened extremely sharply in a very short time period - and this is now starting to have an impact on the real economy. While still on a growth track, we can observe a “waiting mode” in more and more businesses. We hope that a signal of “peak” interest rates and medium term stability will enable businesses to come out of that “waiting mode” and to take an investment outlook more on a medium term basis.

On a long-term basis, we remain optimistic. There are a lot of challenges to tackle by the Government and by business and we are convinced that we can have a true impact either by providing trust or sustainable outcomes to our clients. Therefore, we continue to invest heavily in our business and we do not let us be distracted by short term market volatilities.

I would like to thank our clients for the continued trust they put in our services and in our Firm. And I would like to specifically thank all of the partners and all of our People for a job extremely well done and for all the efforts provided. Villmools merci!

I hope you find this Annual Review useful and impactful. I value any feedback to be received because it is only through constructive critique that we can adapt and improve.

Warm regards

François Mousel, Managing Partner

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